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Auditor: Narrows' reserve fell to $215,070; recommends rebuilding to roughly $300,000
Summary
At the Jan. 12 Narrows Town Council meeting, auditors reported an unassigned general fund balance of $215,070 and recommended a reserve target of roughly $300,000 to protect the town against revenue drops and unexpected expenses.
The Narrows Town Council heard an audit presentation on Jan. 12 from an auditor with Robertson Farmer Cox that showed the townFirm reporting an unassigned general fund balance of $215,070 at the end of the year and a recommendation to rebuild the unassigned fund balance to about $300,000.
Eppley, an auditor with Robertson Farmer Cox, told the council that the townfirm recommends a minimum unassigned fund balance equal to 10% of annual budgetary expenditures and noted that for smaller localities the firm typically recommends a 20% target. "For smaller places, we typically recommend 20%. So for you guys, we would recommend about $300,000," the auditor said.
The auditor also reported that the towntotal long-term debt across funds rose this year, driven by notes payable for a police vehicle and VRA issuances tied to water and sewer projects; the report listed approximately $1.7 million in total debt and an $818 debt-per-capita measure as of June 30, 2025.
Council members discussed causes for the decline in reserves, noting a year-long closure of a major water customer after flood damage and timing of FEMA reimbursements. "So flood did affect this on it," one council member said, explaining declines in expected revenue.
The audit report identified two recurring findings: segregation of duties (a longstanding material weakness in the townfinancial controls) and adjustments to the financial statements that had to be made because consultant-prepared accrual entries were missed. The auditor said no issues arose during the audit process itself and that staff were cooperative.
The council received the report; no formal policy votes were taken on the audit itself. The auditor offered to provide requested detail and contact information for follow-up questions.
What's next: Council members said they will continue work to increase reserves and consider budget options in the coming fiscal year; staff will review the auditrecommendations and supply additional details if requested.
