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Surf City audit returns unmodified opinion; council hears strong fund balances
Summary
An independent audit for the year ending June 30, 2025, gave Surf City an unmodified opinion and highlighted strong fund balances across general, utility, and accommodation-tax funds; auditors reported no significant internal-control deficiencies and noted million-dollar positive net changes in key funds.
The Surf City Town Council on Monday heard a presentation from audit manager Austin Eubanks of Thompson Price, Scott and Adams, who said the firm issued an unmodified opinion on the town's financial statements for the fiscal year ending June 30, 2025, and found no significant deficiencies in internal control.
Eubanks told council total general-fund revenues for FY2025 were $19,186,000 and expenditures $16,224,000, producing a positive net change of about $2.9 million. He said the fund-balance-available percentage sits at roughly 101 percent under Local Government Commission (LGC) methodology, which the auditor characterized as "well above" the minimum 25 percent threshold.
Melissa Moore, the town's finance director, joined the presentation and answered questions about the December financial statements and the treatment of payroll timing, noting that payroll processed at the end of December is recorded with a roughly two-week lag. Moore also confirmed the packet includes the revenue-expenditure report and balance sheet; she said notes and disclosures show the details of transfers and commitments.
Eubanks detailed several enterprise and special funds: the beach-renourishment fund reported total revenues near $15.4 million (including state grants of about $10.9 million and county contributions of $3.36 million), and the water and sewer funds each showed positive net changes after operating and nonoperating items and transfers were considered. He said the auditors performed required single-audit procedures for two grant programs (water-resources development and a drinking-water state reserve grant) and found controls and compliance strong.
Council members asked for presentation clarifications, including an alternate ratio that excludes transfers to better reflect day-to-day operating coverage; one council member said using operating expenditures only would show a higher available-percentage number (cited in discussion as around 123 percent). Eubanks and staff agreed to include additional explanations in future slides so the public and new readers can see the difference between the mandated LGC metric and an operating-only view.
The presentation concluded with council praise for the finance team's preparation. No formal action was required beyond accepting the report for the minutes.
