Harrison County received a clean audit for the year ending Sept. 30, 2018 — and officials noted a deficiency identified last year has been resolved.
The Pattillo, Brown & Hill accounting firm, of Waco, recently presented Harrison County its external audit report, giving the county an unmodified opinion, which is the highest level of assurance an auditor can offer.
“We did not have to modify the report for errors or internal control deficiencies that we feel can lead to inaccurate financial reporting,” John Manning said.
He credited the unmodified opinion not only to the cooperation of the county auditor’s office, but all county departments.
“It’s not just the (county) auditor, although they did a super job; this is a countywide effort to make sure that you have an unmodified opinion,” Manning said as he addressed the Harrison County Commissioners’ Court. “We appreciate all of the departments that we worked with. They had a lot to do with getting this.”
Manning was happy to report that the deficiency listed in last year’s audit regarding a delay in bank reconciliations caused by the past administration of the county treasurer’s office has now been resolved. Bank reconciliations are performed to make sure that the cash balance on the general ledger is recorded at the proper amount.
“We had some difficulties of getting bank reconciliations done, but (they) got those all caught up,” said Manning, acknowledging the teamwork of newly-elected County Treasurer Sherry Rushing and County Auditor Becky Haynes.
But although caught up, Manning said the outside auditing firm still had to note that the outgoing treasurer had not made the reconciliations by the Sept. 30 fiscal year end, prior to the newly-elected treasurer taking office.
“In line of standards, we had to put it in this year; so as of Sept. 30, they were still not done. But if you look at your ‘as of the end of the audit’ (notations), we have this for a current year finding status as being ‘resolved,” said Manning.
The findings note that the reconciliations were up-to-date as of May 31, 2019, and will be monitored on an ongoing basis to ensure they are being performed on a timely basis.
“So none of this ... as long as we keep on time ... it won’t be in the report again next year,” said Manning.
Manning thanked the county for working hard to resolve the delay in bank reconciliation issue this past year.
“I know this has been in there for several years. I know a lot of people have worked very hard to get that out of here,” Manning said. “We really appreciate that and the county knowing that this is a serious matter. You’ve dedicated your time and effort to get that corrected.”
The financial highlights are included in the audit to give the public a more clear insight on the financial activities for the particular fiscal year.
According to the highlights, the county’s net position, as indicated in the government-wide financial statements, is $11,263,487.
“This is an increase of $1,272,777 or 13.6 percent compared to the prior year,” officials stated.
The increase was primarily caused by a gain on the sale of road and bridge capital assets during the fiscal year.
“Total net position are comprised of net investment in capital assets, of $16,799,322, including property and equipment, net of accumulated depreciation; amounts restricted by debt covenants, grantors, or statute of $2,050,021; and the county’s unrestricted net position at year-end, which is a deficit balance of $7,585,856,” officials said.
The highlights additionally note that the total governmental long-term debt of the county decreased by $514,607. The decrease resulted from scheduled principal payments.
“The county did not issue long-term debt during the fiscal year, so no increases resulted,” officials said.
The unassigned fund balance in the General Fund, as shown in the fund financial statements, is $6,796,804 or 35.4 percent of General Fund expenditures.
The audit further notes that over the last several years the county has seen property tax collections at 98 percent expected collection rate, with revenue being flat or slightly lower over the past several years.
“The service provided by the courts’ and clerks’ offices in the county are funded partially by revenue generated by fines and fees assessed by the courts,” the audit states.
Additionally, the county showed a $1.4 million decrease in most expense functions during fiscal year 2018.
“This was due to the county’s continued effort to lower expenses countywide,” the audit states. “The county’s goal is to maintain this effort in future years.”
Regarding the county’s statement of revenues, expenditures and changes in fund balances, Manning pointed out that the county added about $1.2 million to the general fund balance; $882,000 was added to the road and bridge fund balance.
“So as far as warning signs or things that we need to point out, we do not see any financial difficulties that look like they’re (looming),” he said “There are always emergencies; there are always things that come up, but (it’s) a very good reserve, a very good budget.”
Manning also indicated that the county’s actual revenues totaled $20.3 million, which is a $218,000 difference from the budgeted amount.
“(That’s) very good,” said Manning, noting the county stayed well under on expenditures. “With those two things combined are the reasons why you were able to add the fund balance for the end of the year.”