Only six months after the city of Gainesville sent its late fiscal year 2021 audit reports to the state, an external auditor has completed the fiscal year 2022 audit of financial statements.
Barbara Boyd, a partner with the Purvis Gray accounting firm, presented the firm’s findings to the city’s audit committee Tuesday and said they had given the financial statements a clean “unmodified” opinion.
The three-person audit committee voted unanimously to accept the FY22 Annual Comprehensive Financial Report and to forward the report to the full City Commission. The City Commission will discuss the report at its June 15 meeting, said Mayor Harvey Ward, who chairs the audit committee.
The fiscal year runs from Oct. 1 to Sept. 30, and the independent audit reports are due nine months after the end of the fiscal year. The FY2021 audit, which involved catching up on more than 17 months’ worth of bank reconciliations in order to complete, was six months late.
The city has had problems with financial reporting, which has been noted on audits going back to 2018. In contrast to the previous year, the FY22 external audit report should make the state’s June 30 deadline.
Sue Wang, the city’s finance director, told the committee Tuesday, “I have only one thing to say: We are caught up.”
The FY21 external audit identified delays in financial reporting and bank reconciliations as material weaknesses in its report on internal control over financial reporting. The report also stated a significant number of adjustments had to be made once the records were reconciled.
The FY22 audit of financial statements noted similar problems. However, Boyd said she doesn’t expect future external audits to reflect these problems.
“Those [findings] are mostly carryover financial statements,” Boyd said. “If management continues on the trajectory that we’ve seen… we do believe these items could be finally closed and corrected by next year.”
Boyd also said a tight time frame between the FY21 and FY22 audits meant the city had to make more than 100 adjustments to its financial statements after the external audit began.
“While I would normally say that is very serious and cause for concern, I will just remind you we finished our fiscal year 2021 audit in December of 2022,” Boyd said. “There was very limited time for management, for the finance team, to prepare for the fiscal year 2022 audit.”
Boyd also said she did not have any difficulties to report in performing the external audit.
“This is the first year since I’ve been doing the audit that I’ve been able to say that,” Boyd said. “There’s always been some delay or management not being prepared. There’s always been some reason we have had some difficulties in performing the audit, so I’m very pleased to say this year that was not an issue.”
Wang said the financial services department is starting its year-end planning for fiscal year 2023, which ends Sept. 30.
“As recent as six months ago, we were dealing with three fiscal years but now we [just] have fiscal year 2023 to deal with,” Wang said.
In the last month, Wang has added Dennis Nguyen to her staff as the city’s new controller, which she said would help the city moving forward.
Wang herself was initially hired as controller in June 2022 but had to move into the finance director position when the previous director quit due to illness.
Nguyen, who was introduced to the audit committee on Tuesday, is a UF grad and was previously working as an assistant controller for the university.
“I am honored to serve this city and its people,” Nguyen said Tuesday.
The mayor praised the financial services team for their work and congratulated Wang on hiring Nguyen as controller.
“It is critically important, obviously, to have those positions filled and filled with people who are able to be counted on,” Ward said. “The lesson from this, of course, is we always have to take care of the finance department.”