[read complete report - pdf]

Audit Objective

Determine whether the Board effectively managed the Town’s financial condition.

Key Findings

The Board:

• Adopted budgets that underestimated revenues (until 2019), overestimated appropriations and failed to use most of the appropriated fund balance for operations.
• Did not effectively manage the Town’s financial condition, which resulted in the townwide (TW) general fund having unassigned fund balance totaling $768,926 as of December 31, 2019, or 79 percent of actual expenditures.
• Did not develop multiyear financial and capital plans or adopt a reasonable fund balance policy.

Key Recommendations

The Board should:

• Ensure the estimates for revenues and appropriations are reasonable based on historical or known trends.
• Develop multiyear financial and capital plans and revise its fund balance policy.
• Reduce unassigned balance in the TW general fund and use excess funds in a manner that benefits taxpayers.

Town officials generally agreed with our recommendations and indicated they planned to initiate corrective action. Appendix B includes our comment on an issue raised in the Town’s response letter.