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Town audit finds unmodified opinion, flags ARPA compliance and receivables cleanup
Summary
An LGC audit gave Stanley an unmodified opinion for FY 2024–25 but required a single audit because ARPA spending exceeded $800,000; auditors flagged old customer receivable data and recommended formal journal-entry review procedures.
Michael Carey of the Local Government Commission presented the Town of Stanley’s FY 2024–25 audit to the Town Council on March 2, reporting that the audit yielded an "unmodified opinion on the basic financial statements," the highest level of assurance an auditor can provide.
Carey told the council the town required a single audit for 2025 because American Rescue Plan Act expenditures topped $800,000 — roughly $600,000 previously received plus about $212,000 from the North Carolina Department of Environmental Quality — which triggered federal single-audit requirements. He noted the federal threshold for single audits rose from $750,000 in 2025 to $1,000,000 in 2026, and the audit timeline was affected by a late release of the U.S. Office of Management and Budget compliance supplement.
The audit identified two significant deficiencies: customer receivables that contain old data and need review and cleanup, and a relatively high number of year-end audit adjustments. Auditors also recommended the town establish a formal process for reviewing and approving journal entries.
Key financial figures highlighted by Carey and Town Manager Steven Denton included general fund unrestricted cash of $2,660,000, an unassigned fund balance of $2,366,000, general fund revenues of $6,000,000 versus expenditures of $6,123,000, and a fund-balance increase of about 18.4% from 2024 to 2025. Denton noted cash adequacy covers about 159 days of general fund expenditures (compared with 138 days in 2024) and that the water-sewer fund had about 247 days of cash adequacy.
Carey and Denton both described the town’s overall fiscal position as strong: the fund balance available as a percentage of expenditures rose to 40.96% for 2025 from 37% in 2024 and 32% in 2023, and the town added $611,000 to reserves while paying down nearly $700,000 in debt during the year. Carey said the Local Government Commission would like to see fund balance at 60% as a long-term target but acknowledged towns vary in how quickly they can reach that level.
Council members asked questions about debt management and audit timing. Denton explained past audit delays stemmed from water-sewer accounts-receivable ledger issues that required reports from the software vendor; the 2025 audit was filed on time.
The council took no formal action on the audit presentation; the report will remain part of the town record.
