Kingsburg gets stamp of approval in clean audits

Kingsburg City Council accepts clean audits of the city’s financial statements and compliance with federal funding requirements

Councilmembers Laura North (right) and Staci Smith (left) discuss topics on the evening's agenda. (Kenny Goodman)
Councilmembers Laura North (right) and Staci Smith (left) discuss topics on the evening's agenda. (Kenny Goodman)
Serena Bettis
Published May 11, 2024  • 
9:00 am

KINGSBURG – Recent audits of Kingsburg’s finances have confirmed that the city is doing a great job managing taxpayer money, as well as meeting all the accounting standards and reporting requirements it needs to stick to.

Clovis-based accounting firm Price Paige and Company (PPC) conducted an audit of the city’s 2022-23 financial statements and issued an unmodified, or clean, opinion on them, which the Kingsburg City Council voted 4-0 to accept at its May 1 meeting; Councilmember Laura North was absent. PPC Audit Supervisor Anthony Gonzales told the council that the firm’s unmodified opinion meant they found Kingsburg’s financial statements to be “fairly presented in all material respects.” 

“It also tells the users that the significant accounting policies have been consistently applied, the estimates included are reasonable and free from significant bias and the disclosures are complete and properly reflected in the financials — so good news there,” Gonzales said.

California state law requires cities to prepare audited financial statements every year in order to verify the city properly manages and accounts for its finances, including tax revenues, grant funding and general expenses. 

PPC completed two audits for the city of Kingsburg, including a single audit report — required because Kingsburg spent more than $750,000 of federal award funding during fiscal year 2022-23 — and an Annual Comprehensive Financial Report (ACFR). In his presentation to the council, Gonzales focused on explaining the scope of the audits and what the findings revealed about the city’s internal accounting processes. 

The single audit included two reports: one on government audit standards that reviews the city’s internal controls, and one on uniform guidance, which reviews the city’s compliance with federal expenditure requirements. For the uniform guidance report, the firm did not identify any weaknesses that could hurt the city’s compliance.

“We noted about $1.4 million of federal expenditures during the year, and I’m pleased to report that we did issue an unmodified opinion over the city’s compliance,” Gonzales said. 

Within the government audit standards report, PPC identified two weaknesses in the city’s internal controls related to the audit. According to the report, the city’s financial closing and reporting process for the end of the fiscal year was not complete or accurate, resulting in the need to make adjustments in order to correct the city’s general ledger and reconcile various account balances. 

Gonzales said the firm also identified a deficiency related to the city’s cash and bank reconciliation process, which was a carry-over finding from the previous year. According to the report, this caused a misstatement of cash balances on the city’s general ledger, and the city had $132,000 more cash in the bank than what was recorded on the books. 

After making adjustments throughout the audit process, there was still an unreconciled difference between the bank balance and the general ledger of approximately $35,000, the report said; however, the audit did not identify any fraud related to these errors. PPC provided a recommendation to the city to work with a consultant that could redesign the city’s bank and cash reconciliation process to ensure that these errors do not occur. 

Finance Director Alma Colado told the council that the city is already in the process of implementing a service that will help with correcting that finding within the city’s current accounting software, to ensure the city is balancing its finances “to the penny.” Additionally, she said the city has a process in place to address the fiscal year closing and reporting process that will help with the next audit.

Other than concern over those two findings, the city council commended staff for the job that they have done in ensuring the city is in a good place financially and with its accounting. 

“I do want to point out that there was a lot audited here and I think these findings … are very minimal given the scope of the audits, so I do want to praise staff for the good job that they’re doing,” Mayor Brandon Pursell Jr. said. “With these items that were found that were deficient, if there’s something you guys need that we can help as council in the future, please let us know.”

Serena Bettis
General Assignment Reporter