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Kennedale
Friday, July 1, 2022

City Council reviews annual audit

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The City of Kennedale received the annual independent auditor’s report (Comprehensive Annual Financial Report (CAFR)) for the fiscal year ended September 30, 2018 as conducted by the firm of BKD CPAs & Advisors. {{more: continue …}}

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The formal presentation was made at the regular meeting of the Kennedale City of Council last week on April 16. The firm issued an ?unmodified opinion,? meaning that the audit provides a high level of assurance that a professional, independent examination of financial statements has not revealed any actual or possible material misstatements in those financial statements. See the? full audit report @ City Financials.
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Outgoing City Finance Director Brady Olsen presented additional information in a letter to the council addressing some concerns or questions that the council and/or auditors may have had. The following is some of what he had written.
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?Concerns …? ?
  • As we discussed during the selection process for a new auditing firm, we rely on our auditors to assist in many end of year accounting entries. This was particularly true in the FY ?17-?18 year end close out as we had lost key accounting personnel. We have since filled all positions and should be in a better position moving forward, although we will likely continue to rely on assistance from our audit firm in some of the more complicated GASB entries.
  • In regard to controls [separation of accounting duties to help assure accountability], a city staff of our size will always be challenged to maintain a full segregation of duties. We are continually looking for ways to improve, and made several key changes to our cash handling process this past year.
  • The FY 17-18 budget was adopted with tax rates and water and sewer rates recommended by staff. Any significant differences from the FY ?17-?18 adopted budget to our projected results were discussed throughout the FY 18-19 (current year) budget process.
  • For the General Fund, revenues were generally higher than anticipated. Additionally, we expect to receive a $156,000 FEMA reimbursement this year, which is now included in the fund balance projection.
  • For the Debt Service Fund, approximately $140,000 in debt payments were re-assigned per our auditors.
  • The Storm Water Fund encumbered capitals project at the end of the year.
  • The EDC received higher than anticipated sale tax revenue.
  • The Water and Sewer Fund is now anticipated to receive partial re-payment from the TIF in the current year from previous advances for capital projects.
  • The Street Fund is now anticipated to receive partial re-payment from the TIF in the current year from previous advances for capital projects. Read

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  • The City will work towards controlling expenditures and exploring new revenue opportunities to grow the general fund balance. Efforts have been put into place to restore net working capital in the water and sewer fund.

Some the financial highlights from the audit?…

  • The assets and deferred outflows of resources of the City exceeded its liabilities at the end of fiscal year 2018, resulting in $41,420,769 of net position. This is compared to $40,389,147 in 2017.
  • As of the close of fiscal year 2018, the City?s Governmental Funds reported a combined ending fund balance of $2,986,355, an increase of $553,312 from the prior year.
  • At the end of the current fiscal year, total fund balance for the General Fund was $2,855,447. This represents approximately 39% of General Fund expenditures.
Find out more @?City Financials.

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