Finding Text
Criteria: The City is required under KRS 91A.040 to file the annual audit report to the Department for Local Government by no later than April 1 immediately following the fiscal year being audited. Condition: Deficiencies in the City’s internal controls prevented the timely completion and submission of the annual audit report to the Department for Local Government. Cause: The City failed to provide proper oversight over period-end financial reporting which resulted in delays in issuing the annual audit report for the year ended June 30, 2025. Effect: The City did not file the annual audit report for the fiscal year ended June 30, 2025, to the Department of Local Government by April 1, 2026. Recommendation: We recommend management review the period end financial reporting process and implement changes to allow for timely completion of accurate financial reports. This will allow them to be in compliance with KRS 91A.040. Response: The City agrees with the finding and recommendation. Management will review and strengthen the year-end financial reporting process to improve the timeliness of the audit and financial statement preparation. The City will work with its auditors to establish and monitor reporting deadlines and will evaluate staffing and training needs to help ensure compliance with the reporting requirements of KRS 91A.040 in future periods.