Auditor gives Haysi a clean opinion but warns of material internal‑control weakness and flags fire‑department fuel charges

Tamara Greear of Clear Point CPAs told the Haysi Town Council on June 23 that the town’s FY 2024–25 audit received an unmodified, clean opinion, but that auditors had escalated a prior internal-control deficiency to a material weakness.

Greear summarized the town’s position of net assets, saying $1,771,212 of assets will become depreciable once the new town hall construction is complete. She noted the town reported deferred outflows related to pensions from participation in the Virginia Retirement System totaling $86,235 and an unassigned fund balance of $448,030. Greear said the audit showed a negative change in fund balance tied to the timing of grant proceeds and that GASB 101 had been implemented this year.

“The town received an unmodified, clean opinion,” Greear said, and she added that auditors “do not look at one hundred percent of the transactions, but take samples for testing.” She explained a past deficiency in segregation of duties had been escalated to a material weakness in this report and described the management-letter items auditors raised for the council’s attention.

The management letter (a nonpublic document) highlighted three areas of concern: segregation of duties within town operations, grant‑tracking and receivables, and difficulty obtaining documentation for certain Haysi Volunteer Fire Department fuel charges. Greear said the fire department had been associated with the town in past audits but, as of 2025, was no longer part of the town’s organization and had not provided supporting receipts for some credit‑card fuel purchases. She recommended the council remove town‑issued credit cards used for fuel and instead provide fuel support by another method to prevent the issue from becoming a formal audit finding.

Council Member Allison Mullins asked whether the auditors found any expenditures of a personal nature; Greear said none were identified for FY 2024–25 under the audit’s testing. Mullins also asked for recommendations to improve internal controls; Greear suggested practical steps such as council review of monthly bills or large transactions, requiring pre‑authorization for purchases above a set dollar threshold, and assigning procedures by position rather than by the individual currently occupying the role.

Greear told the council that activity from FY 2025–26 (including the new town hall) was not yet included in this audit and that assets will appear differently in the next audit. Vice Mayor Michael Harris thanked Greear for the presentation.