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Neenah auditor issues clean opinion; general fund rises amid investment gains
Summary
An external auditor told the Neenah City Council the 2025 audit resulted in an unmodified (clean) opinion, no material findings and an increase in unassigned general fund balance to about $6.0 million, driven largely by stronger-than-budgeted investment income.
A Baker Tilly auditor told the Neenah City Council on June 17 that the city's 2025 Annual Comprehensive Financial Report earned an unmodified — or "clean" — audit opinion and contained no material entries or internal control findings.
The auditor said the city’s unassigned general fund balance stands at roughly $6.0 million, an increase of $288,000 from the prior year, and that overall fund balance rose by about $362,000. Revenue came in roughly $108,000 over budget, led by building-permit fees, but the auditor said the largest driver was stronger investment income, which exceeded budgeted expectations by about $421,000.
"We issued our final opinion on May 22nd this year," the Baker Tilly auditor said, adding that the firm issued an "unmodified opinion. It's a clean opinion," and that the audit produced no material weaknesses or significant control deficiencies.
The auditor walked the council through key fund metrics: non-spendable balances of roughly $11,000, assigned balances including carryforwards and library-related amounts of about $457,000, and an unassigned balance that represents the bulk of fund liquidity. That unassigned balance equates to roughly 21 percent of expenditures (about two months of operating costs) when viewed alone; combining the general fund with the city's internal service/benefit fund increases that coverage to about 39 percent, the auditor said, which aligns with common municipal benchmarks.
On debt, the auditor reported Neenah’s general obligation debt utilization at about 49 percent of capacity (down from the mid-50s in recent years) and noted that removing utility-related GO debt would lower the ratio to about 42 percent. The water utility was described as having a positive operating margin and nearly 13–14 months of unrestricted cash; sewer reserves dipped toward rating-agency targets but rate changes effective in 2026 are expected to improve reserves.
Council members asked whether additional policies or centralization would improve controls and efficiency. The auditor recommended adopting flexible fund-balance policies and considering additional centralization of collections and grant administration to strengthen processes without unduly reducing operational flexibility.
After a brief question-and-answer period, the council voted 8–0 to receive and place the 2025 Annual Comprehensive Financial Report on file.
What happens next: City staff said they will continue routine financial reporting and follow the auditor’s suggestions about policy development and centralization where practical.
