On May 13, 2022, the City of Reidsville received their 2019-20 audit and annual financial report for the fiscal year ending on June 30, 2020.
This audit, conducted by Lanier, Deal & Proctor of Statesboro, provides and analyzes financial statements of the governmental activities, the business-type activities, each major fund, and the remaining fund information of the City of Reidsville, Georgia. It is the auditor’s responsibility to express opinions on these financial statements based on their audit.
An Independent Auditor’s Report was also included with the audit. This report shows the auditors’ consideration of the City of Reidsville’s internal control over financial reporting and their compliance with certain provisions of laws, regulations, contracts, and grant agreements, among other matters, the report states. This report is not opinion based.
The following deficiencies in internal control were found to be significant:
•Transaction Posting: The auditors noted transactions that were not recorded on the computerized accounting system, including transactions in special accounts maintained by other departments. Auditors also noted transactions that were posted to incorrect general ledger accounts. The city’s financial officer should ensure that activity for all City bank accounts is properly posted to the general ledger to accurately reflect the financial information of the City.
•Payroll Liability Accounts: During the audit, it was noted that payroll liability accounts are not being reviewed and reconciled on a periodic basis. Payroll liability accounts should be reviewed to ensure accuracy and completeness on a monthly or quarterly basis. It was recommended that the payroll clerk for the city be responsible for this task and that the financial officer review the reconciliation of the payroll liability accounts on a periodic basis.
•Recording of Year End Accruals for the Financial Statements: The City’s internal control procedures to ensure that all year-end accruals, such as receivables, accounts payable, prepaid items, and unearned revenue are included in the financial statements are inadequate. Many of the adjusting journal entries needed to record these accruals were material to the City’s financial statements.
•Payroll Tax Liabilities: The auditors noted some payroll tax deposits were not made timely. The City incurred significant penalties and interest as a result of late payroll tax deposits.
Budget Amendments: As noted in Note 2 to the financial statements, expenditures exceeded appropriations at the legal level of control for some general fund departments.
The City of Reidsville concurred with all of these findings and responded with intent to implement procedures to correct these deficiencies. The results of the auditors’ tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards, according to the report.
An audit involves performing procedures to obtain audit evidence about the amounts of disclosures in the financial statements.
The audit can be found on the City of Reidsville website, https://cityofreidsvillega.com/documents/119/2020_Audit.pdf.