SB and Company issues unmodified opinion on Montgomery County's FY2024 audit; no fraud found, single audit nearly complete

SB and Company told the Montgomery County Audit Committee that it had issued an unmodified opinion on the county's FY2024 financial statements and discovered no instances of fraud.

"We've issued an unmodified opinion on the financial statements," said Bill Seymour, engagement partner with SB and Company. "We did not discover any instances of fraud." Seymour noted that an external financial audit is not a fraud audit by scope but added that the firm maintains professional skepticism throughout the engagement.

The auditors described a risk-focused approach and a five-part control-environment assessment covering tone at the top, risk assessment, control activities, information and communication, and monitoring. Toby Hollander, the audit partner, said the firm deemed all five areas effective after testing key processes including treasury, revenue, expenditures, payroll, fixed assets and IT general controls.

Auditors also summarized single-audit work tied to federal grant programs. "The total federal awards this year were about $265,000,000," Hollander said. The firm reported testing roughly 21% of federal awards, about $55,000,000, across seven major programs including SNAP, ARPA/ERAP-related awards, TANF, the Social Services Block Grant and other federal grants. The single audit remained in progress, with auditors reporting they were about "95, 98%" complete on remaining tests and expecting to meet the March 31 deadline for filing.

Renata Reese, the audit manager, reviewed required communications: management retains responsibility for financial statements and accounting policies; auditors reported no audit adjustments, no material weaknesses, and no disagreements with management; and the firm stated it had remained independent and performed only audit services.

Committee members asked whether auditors had recommendations that would rise to a management-letter level and whether the term "effective" is the highest rating the firm issues. Seymour said auditors had only minor housekeeping items that would be discussed during single-audit wrap-up and confirmed the firm uses "effective" in lieu of positive language. He said auditors received full cooperation and read-only system access that aided testing.

The committee did not take further formal action on the audit presentation at the meeting. The county's single-audit report and any final communications will be completed and shared after the remaining tests are finalized.