Lauren Monica | Anson Record
WADESBORO — Tim Zeng, of Thompson, Price, Scott, Adams & Company P.A. accounting firm, presented data from his firm’s completed 2023 budget audit on Tuesday, May 21 to commissioners, county leaders, and citizens.
Starting with good news, Zeng announced, “I just spoke with your County Manager [Leonard Sossaman] and your audit has been approved by Local Government Commissioners (LGC) last night. We are currently working on the 2024 fiscal year and so this will be the first time in the recent five years that your budget has a chance to be on time.”
Noting that he has worked with Anson County’s budget since 2021, Zeng confided that it is personal for him to see the county turn the tide of its financial course, stating, “For ‘21, ‘22, and ‘23, we were able to do three budget audits in fourteen months so that is really something to acknowledge.” He added, “That is a personal record for me and for the firm.”
Under the Funding and Issues portion of the audit presentation, Zeng identified four funding issues, “The first one being the Reconciliation of Records. This goes hand in hand with a late audit, which is finding number three, and number four is due to late submission to the federal agency. Second funding is the Budget Violation, which is really small when compared to last year.”
He added, “We have full intentions of eliminating all four findings if we bring your 2024 audit back on time.”
Provided for all counties, “There is some medicaid funding from social services,” highlighted Zeng.
Pointing out it is customary for his firm to supply clients with data going back five years in a side-by-side comparison format, Zeng reported, “First item here being 2023’s Total Fund Balance, over $29 million dollars, and if you compare that to the previous four years, you will see that it is the highest amount among those five years. That is a resounding number that makes sure you have enough fund balance in your General Funds to spend.”
On the flip side, he explained, “The General Fund Expenditure is $39 million dollars, and that has also been the highest among the most recent five years. Everything just went up, inflation caused that cost to be up. Most recently we have adopted the 2024 budget, which went up 5% as well.”
Zeng confirmed that the county’s revenue is continuing to go up, covering the cost.
“As a percentage of the Fund Balance, the General Fund Expenditure is roughly 60%, and LGC considers 8% the lowest threshold that covers one month worth of your expenditures. I will say at 65% that is a pretty healthy number when compared to 8%.”
Looking at the Fund Balance and Cash comparison next, Zeng praised, “This position is also the highest it has been in the last five years. Financially speaking, your Fund Balance and your Cash Position is really healthy. “
According to Zeng, “Anson County’s Tax Rate Collection is 94.51% this year. It is a small improvement compared to last year, but the general average statewide is roughly 98%. There is definitely room for improvement for tax collection,” he suggested.
Zeng encouraged, “The only increase in your restricted fund balance this year was due to the $7.9 million dollars appropriation to next year’s budget. If you continue that preparation for the 2024 year, you will see that the restricted fund balance goes up.”
Moving on to analyze profit and loss for the county over the 2023 fiscal year, Zeng said, “There is a little bit of a dip in general funds and that went up in the Water and Soil Department.”
He explained this dip is due to the Waste Water Department’s sludge removal project, slated for completion this year. “So for this year we are definitely going to see this number going up,” he cautioned.
Worrying, because the county is in the midst of a steady population decline, Zeng stated, “The majority of your revenue, almost half of your revenue, came from tax… tax revenue is basically the bloodline of local governments. That is why we cannot emphasize enough the importance of the tax collection rate.”
Zeng identified the county’s main expenditures, or Anson’s Big Four, as continuing to be in General Government, Education, Human Services, and Public Safety.
He added, “If you take nothing away from this presentation, it should be that from 2021 the LGC has issued a Financial Performance Indicator of concern. For this year they have identified five concerns that you need to respond to. The first one being late audits, and you may have some improvement in the 2024 audit. The second one being your Operating Net Loss in the Water and Sewer Fund, and again, that is due to the sludge removal project that we fully anticipate to go away in 2024. The third one is the Cash Asset Condition Ratio. In 2024 we anticipate three of the five going away.”
Cautioning commissioners, Zeng emphasized, “I cannot stress enough the importance of an on time audit.” Though he added, “Hopefully our anticipated completion date is October 31st of this year. That is on time for LGC so it will make everybody happy.”
Next to present, Johnna Sharpe from the North Carolina Board of Commissioners reported, “I work mostly with counties who are late on their audits and I will tell you, Anson has by far done more than any of the other counties in becoming current.” Sharpe declared that she largely attributes this achievement to the tenacious hard work of [Finance Director] Holly Berry.
According to Sharpe, Berry is responsible for bringing the county’s day-to-day records current, intimating it is a feat long overdue. She added, “It is the single most important thing to make sure your audit gets done on time.”
Sharpe went on to praise, “When a smaller government gets behind on their audits it is not that hard to turn it around. But when a county gets behind it is like turning a battleship. I really do feel like your battleship has turned, and is pointed in the right direction. It has taken a lot of leadership, late nights, and weekends by Holly and her staff to get this done.”
Following the meeting, Commissioner JD Bricken shared, “I am pleased that Anson County is turning the proverbial ship around when it comes to our budget audit.”