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Finance commission briefed on year-end close process and tentative Sept. audit schedule
Summary
City finance staff walked the commission through the year-end 'hard close, the 60-day accrual cutoff after June 30, and a tentative audit field-work window of Sept. 21'Oct. 2; staff aims for draft statements in November and possible presentations in December.
Nick, finance staff, told the South Pasadena Finance Commission that the city follows a monthly "soft close" but performs a single year-end "hard close" after June 30 to lock transactions for the fiscal year.
"We have 60 days after the last day of June to review all transactions to make sure they are posted to the correct fiscal year," Nick said, describing the accrual-cutoff review and the need to reverse entries placed in the wrong year.
He said several year-end-only steps support the audited financial statements, including mark-to-market valuation of investments at June 30, a full receivable/payable aging, capital-asset reconciliation, and actuarial valuations for long-term liabilities such as pensions and retiree health. He explained the use of a "period 13" to record auditor adjustments after field work so period 12 remains the locked year used to draft statements.
On timing, Nick gave a tentative schedule: interim audit procedures were already performed in spring; departments are finalizing closing schedules through August; year-end field work is scheduled for Sept. 21'Oct. 2; finance staff expects to draft the financial statements in November with auditor review and final revisions in November'December. He added staff will aim to present audited results to the commission (potentially Dec. 10) and the city council (potentially Dec. 16), and will submit the final ACFR to the Government Finance Officers Association by Dec. 31 for award consideration.
A commissioner asked whether staff uses a tracker to follow true-ups and adjustments during the close. Nick said audit lead staff maintain comprehensive checklists and prepared-by-client schedules and that July can be "muddy" as departments submit late invoices; he expects more clarity by the end of August or September.
The commission received the presentation as an informational item; no formal action on the year-end closing process was taken at the meeting.
