Manteo audit good; letter to be sent to Local Government Commission

Published 1:09 pm Monday, November 20, 2023

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Town of Manteo’s Board of Commissioners received its fiscal year 2023 audit at the first of November.

“In our opinion, based on our audit, the accompanying financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund information of the Town of Manteo as of June 30, 2023 …”

Auditors were Thompson, Price, Scott, Adams & Co., P.A., from Wilmington. On behalf of the firm, Austin Eubanks made the presentation on Nov. 1, 2023.

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Eubanks told the board that the firm found no significant audit adjustments or unrecorded differences; no disagreements with management; no consultations with other accountants to the current auditor’s knowledge; no prior retention issues discussed; no difficulties encountered in performing the audit such as delays, unreasonable timetable, and unavailability of personnel; and no illegal acts or irregularities.

The audit shows at the end of the fiscal year:

Total Revenues and Other Financing Sources: $6,407,317

Total Expenditures and Other Financing Sources: $5,487,476

Net Change: $919,841

The minimum undesignated fund balance as recommended by the state’s Local Government Commission is 34% of expenditures, which equates to $1,865,742.

At year’s end, the unassigned fund balance stood at $7,755,695 and represents 141.67% of the general fund expenditures. When combined with the committed, restricted or assigned funds at $679,518, total general fund balance equals $8,435,213.

The ad valorem tax collection rate was 99.51%.

As for revenue, ad valorem taxes at $2.37 million represented 40% of the town’s revenue; unrestricted intergovernmental revenue at $2.66 million shows 45%; investment earnings at $307,886, 5%; and other revenue at $602,735, 10%.

The non-major funds accounts, including Manteo Cemetery, show:

Total Revenues and Transfers In: $496,822

Total Expenditures and Transfers Out: $467,361

Net Change: $29,461

The fund balance at July 1, 2022 was $513,042; at the end of the year, $542,503

The major enterprise or business fund is the Water and Sewer Fund.

For the fiscal year 2023, the water and sewer fund took in $2,383,644 from usage charges, penalties, taps and connections and rent income. Some non-operating income, including a $500,000 loan forgiveness, totaled $638,165.

The operation spent $1,937,287 on administration, water, sewer and depreciation.

At the start of the fiscal year, the fund’s net position was $7,171,675, to which was added $1,084,522 for a total of $8,256,197 at the end of the fiscal year.

The Water and Sewer Fund generated a required additional communications to the Local Government Commission.

Using a formula involving total assets and depreciation, the capital assets condition ratio shows 0.35, which should be greater than or equal to 0.5. States the auditor’s presentation, “the capital assets condition ratio formula calculates the remaining useful life. A remaining useful asset value less than 0.50 may signal the need to replace the assets in the near future.”

Manteo must submit a response to the Local Government Commission within 60 days. The letter must be signed by all commissioners, town manager and others

Town manager Melissa Dickerson told the commissioners she will write a letter stating that the town now has moratorium on sewer connections in place, has replaced a water pump station, a capital improvement plan for the sewer system was adopted in July, and the town is actively seeking grant opportunities.

The 2023 audit shows long-term liabilities, namely obligations to retired employees. In the government fund, outstanding obligations included compensated absences, net pension liability, total pension liability, and other post-employment benefits. The total long term debt is $3,107,168.

For the water and sewer fund, the total long-term liabilities are $1,536,760.