On the Rebound
AHOSKIE – With its total fund balance increasing, the Town of Ahoskie’s government financial health is strong; certainly, much more so than the 2017 town audit revealed.
That’s according to Jeff Best of Jeff Best, CPA, P.L.L.C., Certified Public Accountants of Belhaven, under contract to audit the town’s financial statements. Best presented a draft audit for year ending June 30, 2018 recently at the regularly scheduled March meeting of the Ahoskie Town Council.
“There’re a few highlight items that have to be added or expanded upon,” Best stated.
The assets and deferred outflows of resources of the town exceeded its liabilities and deferred inflows of resources at the close of the fiscal year by $16,724,242 net.
The government’s total net position increased by $233,635, due to increases in business-type activities. However, the largest portion, 119.45 percent, reflects the town’s net investment in capital assets (e.g land, buildings, machinery and equipment) less any related debt still outstanding that was issued to acquire those items.
As of the close of the current fiscal year, Ahoskie’s governmental funds reported combined ending fund balances of $1,292,191 with a net change of ($505,132) in fund balance. Approximately 71.79 percent of this total amount, or $926,869, is restricted. Approximately 36.04 percent of this total amount, or $465,654, is committed.
At the end of the current fiscal year unassigned fund balance for the General Fund was ($100,332) or zero percent of total general fund expenditures for the fiscal year.
Ahoskie’s total debt increased by 7.32 percent ($1,801,204) during the current fiscal year with the key factor in that increase due to repayment of the town’s debt.
“This means for the governmental activities you’re going to have fixed assets and you’re going to have debt,” Best explained. “For the business-type activities, which is the water-sewer fund, you’re always going to have a debt.”
Best said Ahoskie combines its Beautification Fund, its Drug Enforcement Fund, USDA Reserve Fund, Capital Reserve Fund, and also its Drainage Fund with governmental funds.
Best said the town’s non-major funds are also combined with some of the governmental activities.
“That includes the Street Improvement Fund and the Ahoskie Heritage Day Fund,” he said. “Both of these were also closed within the past year.”
The auditor commended the town on the closing of several funds during the current year.
“As of June 30, of last year, there are no more non-major funds,” Best acknowledged. “That special revenue money, that capital project money; that money has already been spent so those funds have been closed, as expected. That’s less activity in the current year.”
The General Fund is the chief operating fund for the Town of Ahoskie. He said some funds, combined with the General Fund, has also been closed.
Best said because the Ahoskie Tourism Development Authority is a component of the Town of Ahoskie, combining their information with the town’s information.
The town’s unassigned fund balance for total governmental funds was still at a negative $100,000 as of June 30.
“That means there wasn’t any unassigned fund balance at that time,” he noted.
As for revenues, Ahoskie’s collection rate for its ad valorum taxes stood at 97.1 percent.
“That’s a very good collection percentage,” he observed.
The net change in the town’s fund balance was a negative $321,411 according to the audit.
Total revenues, with variance figured into the final budget, came it at negative $16,540, which Best said was a pretty good number. Combined with expenditures and the net change in the fund balance was an increase of $47,187 for the current year.
The town’s Water and Sewer Fund had an increase in the fund balance of $402,075.
Best said the savings in the adjustment of health insurance for retirees totaled $3.8 million over time.
The auditor noted the town had paid $649,000 to debt service. While the town’s debt is $10,635,000, the post-employment benefits savings alleviated the nearly $4 million of that.
“The town was operating a lot more funds as of June 30, 2018 than they were when they moved forward,” Best concluded. “There were four or five funds that were combined and others that were closed out. You saw your unassigned fund balance and your governmental funds and your general funds become a negative number from what it was in the previous year.”
Best pronounced the audit ready to present to the Local Government Commission – plus or minus a few minor changes – once the Town Council approves.
“The Council’s goal was to increase the fund balance by about $140,000 a year,” said Town Manager Kerry McDuffie after the audit presentation. “We ended up increasing it by about $132,000. If we keep increasing it by our goal, we’ll be in a positive fund balance by June 30 of this year.”
“The fund balance did increase,” noted Best, before departing. “But less of an increase than what it was a year ago; some of it because of eliminating funds
“So, we’re moving forward,” asked Councilman Charles Reynolds.
“I think so,” the auditor replied.