Independent auditors give Marion an unmodified opinion despite a material weakness

Andy Grice of Bergen KTV presented Marion's independent audit for the year ended June 30, 2025, and said the firm would issue an unmodified (clean) opinion even though the audit identified a material weakness related to material audit adjustments and prior-period restatements. Grice said the city spent just under $1,500,000 in federal awards during the year and the single-audit on the community development block grant program received a clean opinion.

"We are providing a clean or an unmodified opinion," Grice said, while also noting the audit included a government auditing standards communication that required reporting internal-control matters. The auditor called the finding "not uncommon, especially during a transition year," and said he and his team will follow up on changes the city implements.

City finance staff told council the finding stemmed largely from capital-asset accounting and project accounting during a year when the city moved to separate firms for financial-statement preparation and independent audit. Finance staff said they have begun booking capital assets quarterly, engaged Eide Bailey to assist with statement preparation going forward, and are creating more detailed year-end checklists and audit workpapers.

Leanne, speaking for the finance team, described this as a transition year and said staff had "already had a kickoff conversation with Eide Bailey" to address weaknesses. She emphasized training and process changes for newer staff and said assets were now being posted into the city's financial software before year-end to reduce future adjustments.

The audit presentation also included high-level financial trends: general fund balance rose about 16% to $22.7 million; the city reported a roughly $1.2 million increase in overall revenue (about $1.1 million from property tax growth); public safety remained the largest general fund expenditure at about 57%; the enterprise funds showed a combined surplus (about $2.3 million for the largest enterprise presented); and the stormwater fund ran a deficit this year of roughly $325,000 (though its cash flow excluding depreciation was positive). Council members asked for follow-up and staff committed to returning with improved processes and further analysis during next year's audit cycle.

The presentation closed with staff and auditors agreeing to monitor corrective steps and report progress in future audit communications.