COLDSPRING — The city of Coldspring received a passing grade on its annual audit.
The findings were presented at the council’s Oct. 5 meeting.
Kim Johnson of Todd, Hamaker & Johnson provided a snapshot of the city’s financial statements, transactions, and other procedures to provide transparency to residents. She said her audit report is considered an opinion as it includes feedback to the city on their financial dealing.
Johnson said Coldspring’s revenue for the year was higher than what was budgeted because of grants, while expenses came in lower, and that Coldspring’s overall net position at the end of the fiscal year was $5,797,702.
“The statement of net position shows your assets and liabilities that you have as a city,” Johnson said. “The difference between those (should) be a positive number; you'd want to have more assets than you have liabilities.”
The audit report states that Coldspring does not have any significant long-term debt, emphasizing that the city has a very strong basis in current assets for such a small city.
Coldspring has $2.8 million in infrastructure assets, which Johnson said is due to good management by the city. Coldspring’s revenues for the year were a little over $1,138,000 up from the prior year of $1,023,000.
“I saw an increase in your charges for services in your rates and your collections in terms of your utilities…your capital grants were up pretty significantly during the year,” Johnson said. The city's expenses were also up for the year, also due to grant activity.
However, Johnson did express concerns with how the city is paying for sewer expenses. The audit states that the city has been using money from the general fund to pay for the sewer fund to balance the budget.
“The concern I have is that a business-type activity, such as your utility fund, should be self-sufficient,” said Johnson.
Johnson further reported on the city’s impressive infrastructure improvements.
“You have really some significant infrastructure improvements. I know you have a lot of grants and projects going on right now, but there were about $438,000 in capital assets purchased during the year, and $248,000 of those were funded by grants,” Johnson said.
Johnson said that the city should evaluate their QuickBooks file to separate the general fund from the sewer fund.
“It's just something that is a little bit difficult for me to deal with, because I have to pull the two apart and report them separately,” said Johnston.
The audit did not report any misdealing or unethical practices from the city, and the council accepted the audit report as presented.
