Local News - January 2004

City gets clean 2003 audit report

Published January 21, 2004

By ALICE SMITH, Staff Writer

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The city of Lincolnton was presented a clean audit report for the 2003 fiscal year during a recent City Council meeting.

The accounting firm Cherry, Bekaert and Holland performed the audit.

For the fiscal year ending June 30, 2003, the city had $7 million in its general fund, a drop of about $1.6 million. One million of that represents the transfer of the Powell Bill — funds allocated by the Department of Transportation for maintaining and constructing local roads — to a special revenue fund.

And about $1.1 million had to be used to balance the current year’s budget, but officials hope to only spend a portion of that amount, according to a memo from City Manager Jeff Emory.

The city spent $147,646 more than it took in during the past fiscal year. Officials had originally budgeted $1.2 million to balance that difference.

Emory considered the small negative balance an accomplishment in light of the extra projects the City Council had approved throughout the year.

The purchase price of the land behind City Hall — to be used during the expansion of the building — almost equals the deficit amount in the fund, Emory said.

In the water and sewer fund, revenues showed a slight increase, rising from $5.72 million to $5.79 million.

A wet summer and bad economy probably led to such a small increase, said Raymond Quintin with Cherry, Bekaert and Holland.

“That’s true here and in municipalities all around that state,” he said.

Expenses, excluding depreciation, decreased from $3.77 million to $3.66 million.

Fund equity went down $3.81 million, from $24.03 million to $19.19 million, due to changes in capitalization and depreciation policies.

The unrestricted cash in the account declined by more than half, bringing the total to $4.29 million.

Officials attributed that large decline to the upgrade to the city’s wastewater treatment plant and continued debt service payments. The plant upgrade was a $17 million project.

The city has been drawing the cash in that account down to go toward finishing the plant, Emory said.

“That had been part of the plan all along,” he said.

The city’s electric fund brought in $5.63 million, up from $5.38. Expenses also increased by about $300,000.

Fund equity and unrestricted cash showed slight increases.

And the electric fund continues to have no long term debt.

There were no findings or questioned costs as a result of the compliance audit, Quintin said.

Emory said he is pleased with the audit results, especially considering the city’s undertaking of several large projects.

“Taking that into account, we had a very good financial year,” he said.

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