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Town auditor issues clean financial opinion but flags material weaknesses and federal‑program reporting problems
Summary
The town received an unmodified opinion on FY2024–25 financial statements but auditors identified a material weakness (missing construction accruals and related grant receivables) and a repeat bank‑reconciliation deficiency; as a result, reporting on two major federal programs was qualified. Council and staff discussed remediation, Springbrook software migration and staffing gaps.
Neil Crider, the independent auditor from McGregor Associates, told the Batesburg‑Leesville Town Council that after auditing fiscal year 2024–25 the firm issued an unmodified (clean) opinion on the town’s financial statements but identified two reportable internal‑control deficiencies: one material weakness and one significant deficiency. “Several audit adjustments were proposed and posted to the town’s trial balance to correct material misstatements,” Crider said, describing omitted year‑end accruals for construction invoices and related grant receivables.
Those omissions, Crider said, meant the town’s financial statements would have been materially misstated without correction. He added that bank reconciliations remain a repeat problem and were cited again as a finding. On the single‑audit front, the auditor identified the coronavirus state and local fiscal recovery funds and the Drinking Water State Revolving Fund as major programs and issued a qualified opinion for reporting compliance tied to the internal‑control weaknesses.
The nut graf: the numeric statements in the audit were presented fairly in all material respects, Crider said, but control failings reduced confidence in some compliance reporting. That distinction matters because the audit both affirms the reliability of the audit trail for citizens and flags operational fixes the town must make to avoid future reporting or compliance problems.
Council members questioned staff about causes and remedies. Jay, who answered for staff, said staffing disruptions in finance and the ongoing Springbrook software conversion (went live Jan. 5) contributed to the backlog: “we were a one‑person staff in that office for about six months,” Jay said, and the historical data transfer remained in progress. Councilman Hall pressed on timeliness and legal exposure, asking whether failures could lead to prosecution; the auditor said that was difficult to predict but emphasized that the detection procedures drove the finding.
The council and management discussed corrective steps: creating clearer grant‑specific ledger line items, completing bank reconciliations, finishing the data migration and addressing staffing to maintain internal controls. Crider said the town complied with major‑program requirements in most testing except for reporting compliance and that the material weaknesses had a direct effect on federal program schedules. Staff said they expect the data migration and reconciliations to be current within months and to present progress at the next audits.
Council members asked for follow‑up. The presentation closed with an agreement to track implementation of audit recommendations and to return with updates on reconciliations, staffing and the software conversion timetable.
