Archuleta County received good news Tuesday afternoon — an unqualified 2011 audit with no findings, material weaknesses or noncompliance material.
Auditors from Wall, Smith, Bateman and Associates, Inc. presented the 2011 audit, which looked at the county’s financial statements for the year ending Dec. 31, 2011, during a special meeting Tuesday afternoon.
“I think there’s nothing but good news there,” said Karla Wilshau of WSBA in discussing the county’s budget actuals at the meeting.
Wilshau said the county had no “over-budget results” on its governmental funds, adding, “You had good budget results on every single fund.”
The 2011 audit is the first since at least 2004 to have no findings (meaning no instances were found of the county’s financials violating state statute and governmental accounting standards), according to Finance Director Diane Sorensen.
“It’s been a goal for the board since I’ve been here and a goal of mine,” Sorensen said in a Wednesday interview, adding that the county still has a lot of work to do to become healthier financially.
Still, the results of the audit are “significant” for the county, Sorensen said. Previous overspending at the county caused a financial meltdown in 2007.
Also during the presentation, Wilshau and Kim Temple of WSBA presented the county’s financial highlights.
Among the highlights spoken of and listed in the audit are:
• The county has approximately seven months’ worth of operating revenue in reserves — going above and beyond the recommended three-month reserve.
“That’s really good news for you guys,” Wilshau said.
• The assets of the county exceeded its liabilities in 2011 by $37,545,809. Of that amount, the audit states that $8,580,306 is unrestricted and can be used for the county’s ongoing obligations.
• The county’s total net assets increased by $934,907 (2.6 percent) during 2011, with governmental assets increasing by $1,049,300 and the business-type net assets (Solid Waste) decreasing by $114,393.
• The county’s total longterm liability decreased by $300,667.
• 2011 ended with the General Fund receiving $170,950 more in revenues than was budgeted, with revenues besting expenditures on the year by $1,862,983.
One area of concern noted by Wilshau during the audit presentation, however, is the Internal Fleet Services Fund, which was created in 2011 for the purpose of providing fleet services to other county departments on a cost reimbursement basis.
Primarily because the county’s equipment within the fund depreciates, the fund saw a loss in its first year.
In mentioning the concern, Wilshau noted that discussions with Sorensen indicated costs would be adjusted within the fund to alleviate the loss, but she cautioned the BoCC that the fund should pay for itself so it wouldn’t “fool” them into believing the county had more money than it actually does.
Also mentioned during the presentation was the Solid Waste Fund, which operated at a loss of $110,295 in 2011.
Following the presentation, Commissioner Clifford Lucero asked if the county’s work on internal controls was a big factor in the lack of findings, with Wilshau responding that, “When you work that hard, you get results.”
Wilshau added that internal controls are looked at in terms of risk management, and that a positive tone set at the top will filter down through staff.
Lucero also asked the WSBA team to identify the strengths and weaknesses of the county.
Temple noted the communication and the internal controls as positives, with Wilshau adding the reconciliation of money on a regular basis and the knowledge of financial standing by the county.
“It’s just a lot different now,” Wilshau said. (WSBA has performed the audit on the last five years’ worth of financial statements.)
Lucero also asked how the county compared to other counties.
While Wilshau noted that counties vary in how they must spend their money (for example, roads in the San Luis Valley may cost less than mountain roads locally), she said that, from the standpoint of fund balances, the county is doing well compared to other counties.
Commissioner Michael Whiting then pointed to the county’s internal controls as being a “great stride” and a cultural change within the county.
Whiting also noted that he hoped the county’s citizens would hold the government accountable to the new, higher standard it has reached.
The commissioners thanked county staff, elected officials and department heads for their work in bettering the county financially.
Wilshau then noted something Archuleta County provided that few others are capable of — Sorensen provided the county’s financial statements for the audit — calling it a “great strength” not everybody has.
“What a journey this has been,” said County Administrator Greg Schulte, adding, “It’s been a good journey.”
With that, the meeting concluded with unanimous acceptance of the audit.