Finding Text
Finding 2025-001: Material Restatement to Fund Balance, Net Position, and Capital Assets Condition: During audit fieldwork, our testing resulted in a material restatement of Fund Balance, Net Position, and Capital Assets. Criteria: A good system of internal controls would provide for accurate recording of accruals and deferrals on a regular basis to provide for accurate financial reporting. Cause: Year-end entries related to fund balance, net position and fixed asset balances were required to accurately present the City’s financial statements. Effect: Material adjustments to the City’s fund balance, net position, and fixed asset balances were required to properly state the City’s prior year end balances. Recommendation: We recommend that the City implement effective internal controls in order to provide an accurate assessment of reporting requirements for year-end balances. This implementation of improved controls would result in the appropriate recognition of financial reporting requirements. Corrective Action Plan: The City should implement internal controls to properly record and adjust necessary capital asset balances on a timely basis prior to audit fieldwork. Additionally, the City Comptroller should provide monthly reviews of the financial statements..