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County audit shows regulatory-basis clean opinion, notes material weakness and grant timing issues
Summary
Auditors told the Montgomery County commission they issued an adverse opinion on GAAP but an unmodified opinion on the county's regulatory basis accounting; auditors identified one material weakness and noted a grant-related fund ending negative and subsequent large purchases to be disclosed.
Emily Franks of auditing firm Jared Gilmore Phillips presented the independent auditor's report for Montgomery County for the year ended Dec. 31, 2025 and said the firm issued two opinions: "We issue an adverse opinion and an unmodified opinion," referring respectively to generally accepted accounting principles and the county's regulatory basis of accounting.
Franks summarized the county's cash and fund composition, saying the county's ending unencumbered cash shown for reporting entities was $16,760,159 and the total cash held across funds was presented as $52,726,000, with more than $35 million sitting in agency funds for other local taxing entities. She told commissioners one budgeted fund (special parks and recreation) was slightly overexpended and noted one grant fund ended negative on the statement but may be allowable if reimbursement is expected post-year-end. Franks also noted the county met the threshold for a single audit because it spent more than $1,000,000 in federal funds during the fiscal year.
Franks identified a repeat finding on general ledger reconciliations that the audit team classified as a material weakness but said actions have been taken and some items have been corrected (including motor vehicle activity now incorporated into the accounting system). She said the auditors had included a corrective action plan and that the auditors's report listed a subsequent event: the county approved purchase of a motor grader for $338,000 from Murphy Tractor.
A commissioner moved to accept the audit and authorize county officials to sign; the motion was seconded and the board voted to accept the audit. The commission recorded acceptance and paperwork will be signed as requested.
