City gets clean auditPublished 10:06pm Wednesday, December 12, 2012
Washington’s financial statements for fiscal year 2011-2012 received an unqualified opinion, the best opinion that can be given in an independent audit.
Overall, the city ended the 2011-2012 fiscal year, which ended June 30, in the black, according to the audit.
That audit, conducted by Martin Starnes and Associates, was presented by Crystal Waddell during the City Council’s meeting Monday. The audit concluded there were no significant deficiencies or material weaknesses in the city’s internal controls related to finances.
While the city’s general fund for fiscal year 2011-2012 (before transfers) saw expenditures — $12.3 million — come in above revenues — $11.6 million — the overall budget, including all funds, saw revenues come in higher than expenses, Waddell said.
“That’s a great turnaround,” said Matt Rauschenbach, the city’s finance director, on Wednesday.
“I’d say the general fund is healthy. It’s got a 50-percent available fund balance, which means we match our expenditures well with our revenue. I think, to me, that’s the key. As our revenues, as in sales tax, when they dropped off, we adjusted our expenditures accordingly,” said Rauschenbach.
Councilman Doug Mercer noted that in eight of the past 10 years, expenses in the general fund were higher than revenues. Recently, those expenses were about $1 million more than incoming revenues. Mercer said the city must continue to work toward narrowing the gap between expenses and revenues so it doesn’t have to transfer funds into the general fund to cover the gap between revenues and expenses.
The money being transferred into the general fund to balance it could better be used elsewhere, he said.
The general fund’s balance at the end of the fiscal year was $8.3 million, but that doesn’t mean the city can use all of it in any way it sees fit. State law places restrictions on how some of the fund balance may be spent. The city’s available fund balance is $6.1 million, an increase of $341,137 over the available fund balance of the previous fiscal year.
With the available fund balance at 50 percent of general-fund expenditures, the city more than meets the Local Government Commission’s recommendation that a local government have an amount equal to at least 8 percent of its general fund in its fund balance, or “rainy day” fund to cover unexpected expenditures.