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Braidwood accepts FY25 audit despite qualified opinion on retiree-health accounting
Summary
City auditors issued a modified qualified opinion for governmental activities because the city has not recorded GASB 75 OPEB liabilities; auditors found no internal control or compliance findings and the council voted to accept the FY25 audit.
Sarah McKenna, a senior manager at Wipfli, told the Braidwood City Council on July 28 that auditors had issued "a modified qualified opinion" on the city's governmental activities because the city has not implemented GASB 75 for other post‑employment benefits (OPEB). She said all other opinion units received unmodified opinions and that the audit included a Yellow Book review for state and federal grant spending, which produced no internal‑control or compliance findings.
The audit presentation, delivered by McKenna, covered fund balances (total governmental funds of about $7.3 million with $3.4 million unassigned), an increase in net position for proprietary funds, and audit adjustments related to commingled bank accounts. McKenna said the auditors prepared two management‑letter comments: one flagging negative balances in pooled/commingled cash accounts and a repeated comment about formal journal‑entry review procedures.
McKenna recommended the city consider hiring an actuary to quantify OPEB liabilities and record GASB 75 information in the governmental activities statements. She also said the required TIF report was issued with a clean opinion and urged the council to schedule the joint review board meeting related to TIF before next year's audit work begins.
At the close of the presentation, a council member moved to accept the audit "as presented." The motion passed by roll call. Council members recorded their support during the vote; the motion carried and the city will move forward with the audit filing and follow up on the management‑letter recommendations.
Why it matters: The qualified opinion is narrowly targeted to the accounting for retiree benefits (OPEB) rather than operational controls or grant compliance. Auditors did not identify reportable deficiencies in internal controls or compliance with grant requirements, but the management letter identifies process items the city should fix to avoid future audit adjustments and to improve fund accounting transparency.
The city's next steps, according to the presentation, include pursuing an actuarial study of post‑employment liabilities and scheduling the TIF joint review board meeting; the council accepted the audit and the staff will proceed with the filings and recommended follow‑ups.
