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ELKINS -- The City of Elkins has received its 10th "unmodified" audit opinion in a row, officials said.
An "unmodified" opinion means the auditors didn't find any discrepancies or areas of concern in an annual audit. The city has received an "unmodified" audit opinion each year since 2012.
"This is our tenth unmodified opinion in a row," Elkins City Treasurer Tracy Judy told Elkins City Council. "That is the highest grade you can get, because it means the auditors didn't find any significant errors in our financial statements."
The audit examined financial records from the fiscal year that ended June 30, 2021, and was performed by accountants working for BHM CPA Group, an Ohio-based public accounting firm with offices in Huntington. State law requires municipalities to undergo annual independent audits.
The purpose of municipal audits is to verify the city's financial position, as described on its annual financial statements, and to evaluate its compliance with state law and government accounting standards, a City of Elkins press release states. To accomplish this, auditors review the city's accounting procedures and examine financial records related to revenues and expenditures, grant administration, bank accounts, and more. Auditors also evaluate the city's internal controls, or fraud-prevention safeguards.
Sometimes also referred to as an "unqualified" or "clean" opinion, an unmodified opinion is the best result an audit can return because it indicates that auditors have found no misrepresentations of fact or failures to follow appropriate accounting standards.
A previous City of Elkins press release stated, "The audit process begins each summer with a letter from the state auditor authorizing the procurement of an audit and providing a list of approved accounting firms. The city's Audit Committee then solicits and evaluates proposals from at least three firms on this list. The evaluation process uses a score sheet published by the state auditor to assign points to the firms that submit proposals. Per the state auditor, the firm with the highest score must then be selected to perform the city's audit.
"Next, the selected firm receives the city's financial statements, which are published each fall," according to the release. "The firm examines these statements carefully and uses them to devise an audit plan, including questions to be answered and tests to be performed.
"Some of these questions are answered through correspondence and phone calls. Then, usually in January, the firm sends a team of accountants to visit city hall. Over the course of about a week, these accountants request records and interview staff members. One of this team's tasks is the random sampling of transactions from the year under review, to ensure that the proper authorization, execution, and accounting records can be produced on demand.
"Several weeks after this on-site visit concludes, the firm transmits the results of the audit to council," the release states.