City audit: Alma receives largely unmodified opinion; auditors issue disclaimer for Housing Commission roll-up

External auditors presenting Alma's fiscal 2024 comprehensive annual financial report told commissioners that most city funds and major activities received an unmodified opinion, but the firm issued a disclaimer of opinion for the component unit roll-up of the Alma Housing Commission because the housing commission's auditor did not pass a required peer review.

Allie Barnes of Yo & Yo CPAs said the disclaimer applied only to the housing commission portion of the consolidated statements; the governmental activities, major funds (including the general fund and utility funds) and aggregate remaining funds received an unmodified opinion. Barnes told the commission that the firm's additional procedures and review required extra audit time and expense and that the auditors provided a courtesy discount for some of that work.

Commissioners asked whether the disclaimer would have other ramifications. Barnes said she could not predict specific state or grant consequences but that the city should be able to explain the matter to external funders if it arises. Barnes also highlighted a repeat management comment regarding electronic movement of funds: current systems can allow one person both to initiate and to approve electronic transfers; auditors recommended stronger dual-control protocols.

The commission voted to receive the audit report. The auditors also reviewed trends in the general fund and utilities, noting roughly $5.7 million in total general fund balance at year end and healthy cash levels in the water and wastewater funds. The audit presentation and the auditors' management comment will be included in the minutes.