Another step toward bringing the City of Amsterdam’s finances up-to-date was completed last week as city officials received a finalized audit report on the 2014-2015 fiscal year. The audit was done by the EFPR Group, who also completed the 2013-2014 audit last year, and will begin work on the 2015-2016 audit in June.
For the first time in several years, the auditors were able to view bank account reconciliations and give all the funds except the general fund an “unmodified” opinion, meaning that the city’s financial statements “present fairly, in all material respects, the respective financial position” of those funds.
The lack of bank reconciliations was cited as a problem in the 2013-2014 audit. The city contracted accounting firm Freed Maxick to help bring the reconciliations up-to-date last year, and in the latest audit, the problem is marked as being resolved.
The general fund was given a “qualified” opinion, meaning the auditors still considered the financial statements accurate, but had several caveats.
A continued lack of a city-wide inventory of assets was one problem cited. The issue was also cited last year. Controller Matt Agresta said yesterday that an inventory had not been completed in many years, and said completing that task is “not going to be a cheap process.”
A dispute between the city and Montgomery County on the amount property tax owed to the county was another problem cited in last year’s audit that continues to be unresolved. Agresta said previously that the problem was caused by a lack of regular property tax reconciliations between the city and county in the years before his term in office. Last year, the general fund balance was reduced by $1.5 million as a precautionary measure to account for the discrepancy. Agresta said work on the problem is currently on-going.
Lastly, the audit cited a problem with lack of information on the city’s post-employment retirement benefits, such as pensions paid to former employees. The problem was not cited last year. Agresta said his office is still working on how to provide information on those benefits in a form the auditors can use.
The three issues, along with the fact that the city is still behind with submitting it’s required Annual Update Document (AUD) reports to New York State, contributed to the auditors citing the city with “material weaknesses” in it’s “internal control over financial reporting” as well an “adverse” opinion on its government-wide financial statements.
In regards to the “adverse” opinion, Agresta said, “That’s part of a new standard which [the auditors] have to follow given the findings that they had with the adult. That’s wasn’t something that they would have had to do last year, even though basically the findings are the same as they were then.”
According to Agresta, the auditors will be holding an exit interview, tentatively scheduled for June 20 at City Hall. Agresta also said his goal is to have the 2015-2016 AUD completed before that time in order to give the auditors the information necessary to complete their audit of that fiscal year.
In regards to the overall progress made on the city’s finances, Agresta said, “I think to go from two years ago, not even being able to get anything other than a single audit done, to this point having only a qualified opinion on the general fund and everything else is accurate to their standards, I think we’re certainly making improvements.”
“This is obviously not perfection,” said Agresta, “But we’re definitely working in the right direction to get ourselves where we need to be in terms of having the financials accurate, timely, and up-to-date.”