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Auditor: $78,009 ARPA restatement corrected; pooled cash arrangement explained
Summary
Auditor told the boards that $78,009 in ARPA funding should have been recognized as FY24 revenue and described pooled-cash accounting between town and village; he said pooled accounts can be efficient but separate accounts might reduce risk of reallocation errors.
During the audit Q&A, the independent auditor explained a FY24 restatement and how the town and village record pooled cash.
"That amount of $78,009.40 should have been revenue in fiscal year 24," auditor Tyler Kimberly said, describing an ARPA grant that had been recorded as a deferred inflow and later corrected to revenue so expenditures would match. Kimberly said the audit identified the issue during the FY25 engagement and management signed the proposed adjustment.
On the question of why the village funds are held in the town bank account, Kimberly said pooled cash is common and makes some allocations easier in a shared accounting system. He added that auditors have seen both approaches and that separate accounts are also feasible and could reduce opportunities for end-of-year reclassifications. "From an efficiency standpoint, I think it makes sense," he said, but acknowledged that separate accounts may have prevented the particular reallocation concerns raised by residents.
Kimberly also summarized what the audit team reviewed for the transactions in question: trial balances, general ledger reports that include journal entries, invoices and legal documentation forwarded by counsel. He said missing supportive notes on journal entries raise audit risk and that the audit firm would flag such items for additional procedures in future audits.
The exchange clarified the accounting rationale for the restatement and left open whether the boards will change cash-management practice.
