Present Audit of the Financial Statements for the year ended June 30, 2024 and related communications
TO THE COUNCIL:
I am pleased to present the results of the annual audit of the City of Portland’s financial statements for Fiscal Year 2023-24.
The City received a clean audit opinion. Moss Adams, the public accounting firm that conducted the audit, concluded the statements are an accurate reflection of the City’s finances.
Auditors, however, found a material weakness in the internal controls over financial reporting that is detailed in Moss Adams’ letter to you, called Communications with Those Charged with Governance, attached as Exhibit A.
Portland is required by state law to have an annual audit of its financial statements. Staff from the Accounting Division in the City’s Budget & Finance Service Area prepares the financial statements, and the outside public accounting firm audits them. By Charter, the City Auditor oversees the selection of the outside auditor and manages their contract.
Portland is also required by federal law to have an audit of its federal grant spending. Our outside auditors completed reports regarding the City’s federal expenditures with a clean opinion, also known as the Single Audit, attached as Exhibit B.
Moss Adams Partner Keith Simovic will present the audit findings at the December 18, 2024, meeting of the City Council. The audit report is included within the Annual Comprehensive Financial Report and may be viewed on the website of the Accounting Division, which is part of the Budget & Finance Service Area: https://www.portland.gov/accounting/finance-reports.
Official Record (Efiles)
Impact Statement
Purpose of Proposed Legislation and Background Information
This is a presentation to Council of the results of the independent financial audit conducted by Moss Adams of the City’s Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2024.
No legislation is being proposed. No Council action is requested on the financial audit; however, the Chief Financial Officer may request Council’s acceptance of the Annual Comprehensive Financial Report and Council’s approval of a plan of action to address the material weakness.
Portland is required by state law to have an annual audit of its financial statements. Management prepares the financial statements and an outside public accounting firm audits them. By Charter, the City Auditor oversees the selection of the outside accountants and manages the audit contract.
Financial and Budgetary Impacts
This presentation on the financial audit does not have a financial or budgetary impact.
The cost of this financial audit was reported to Council with Ordinance No. 190726 on March 2, 2022, to approve Contract No. 30008009 with Moss Adams to conduct the financial and federal compliance audits relating to FY 2021-22 through FY 2025-26. The cost of the City’s financial audit is covered by the current budget for the Office of the City Auditor.
Economic and Real Estate Development Impacts
Not applicable.
Community Impacts and Community Involvement
Reporting the outcome of the independent annual audit of the City’s financial statements to City Council and the public will benefit Portland community members by improving City accountability.
The objectives, scope, and methodology of the financial audit are driven by the requirements of City Charter as well as state and federal law. As a result, it is a legal requirement that these audits be conducted independently and in accordance with generally accepted government auditing standards. Direct public involvement was not applicable in conducting financial audit work.
100% Renewable Goal
Not applicable.
Financial and Budget Analysis
Analysis provided by City Budget Office
No fiscal impact.