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Audit flags material weaknesses after Woodstock Aqueduct acquisition, finds $800,000 loan misrecorded
Summary
External auditors told the joint Select Board and Village Trustees that the town's recent Woodstock Aqueduct acquisition created accounting complexity, prompting 31 proposed audit adjustments, a material weakness tied to asset and depreciation records (about $700,000 in additions) and an $800,000 loan that had been recorded though no cash was drawn.
Auditors presented a high‑level review of the Town of Woodstock’s fiscal 2025 records and identified multiple adjustments and material weaknesses tied mainly to a recent acquisition and related accounting changes.
Tyler Kimberly, an audit team member, said the audit work began in the fall and that "I think the biggest thing with the town, from a financial reporting standpoint was the Woodstock Aqueduct acquisition," which created a new fund and added complexity. Kimberly told the boards the auditors proposed 31 adjustments and that management provided an additional 14 entries to reconcile town activity.
Among the most significant items, auditors found the town had recorded a system‑capacity loan for $800,000 as borrowed as of 06/30/2025 even though no cash had been drawn. "So long story short, an audit adjustment was proposed there to simply 0 out that loan cash and related loan payable at 06/30/2025," Kimberly said. Auditors said they expect the loan will be borrowed at a future date and therefore recommended reversing the recording at year end.
Auditors also identified gaps in asset and depreciation records tied to the Aqueduct acquisition and donated equipment totaling about $700,000 that were not reflected in existing schedules. The firm proposed updating asset records to include those additions at historical cost and to reconcile depreciation schedules accordingly.
Other adjustments included correcting debt service accruals versus prepaid treatment, recognition of $139,500 in loan forgiveness as revenue, and a payroll accrual of about $137,000. Kimberly summarized those items as control and reporting deficiencies that the auditors categorized as significant and that the town should address in future financial reporting.
The auditors said they would provide detailed schedules and work with town staff to implement the proposed adjustments; they also noted several of the matters will affect future audits if not resolved.
The town will have an opportunity to review the auditors’ governance letter and the proposed entries; the board did not take any formal vote during the presentation but asked the auditor to supply supporting detail.
