At Monday's Town Council meeting, Paul L. Dansereau, CPA of Baxter Dansereau & Associates presented the Independent Audit performed for the Town of Coventry for the fiscal year which ended on June 30, 2012.
Dansereau briefly showed members of the Council where they could find specific financial information within the 133-page audit (attached) in regards to the Town's net assets, liabilities, fiduciary funds, etc., before his report.
From a long-term standpoint, Dansereau explained that pages 13-14 of the audit show the Town's profits and losses by illustrating the expenses of governmental and business-type operations.
The audit shows a total Net Assets amount of - $14,932,163, a number affected greatly by the amount of liabilities that the Town currently has. Debt, funds restricted for various programs like education, public safety, health/human services and culture/recreation and unrestricted assets are all factored into this figure. Audit Page 13 provides a complete statement of the Town's Net Assets as of June 30, 2012.
"That just shows the long term outlook of the town,"said Dansereau. "It doesn't show the current outlook of the town and as you know, many towns are struggling with pension debt and you're all trying to work through them, but as of right now, this is how the presentation looks."
From a budgetary outlook, Pages 15-16 of the audit explain how the Town's revenues and expenditures are realized. The report showed that Coventry's General Fund balance totaled $11,098,435, resulting in a surplus of more than $2.7 million for fiscal 2012. When added to the Town's accrued General Fund surplus, the balance equals an almost $11.1 million cumulative surplus.
Town Manager Hoover explained that the $2.7 million surplus shown in the fiscal 2012 audit is not commonplace.
"With all of the numbers, it gets pretty confusing to a layperson like myself whose not an accountant to try to understand this type of thing and it's the method of how you state these figures that is often misunderstood," said Hoover.
He referenced page 68 of the audit, pointing out the $2.7 million that was underspent and explained that a major contributing factor to the surplus was a very low number of personnel within the police department due to seven military deployments. He said that the unexpected occurrence caused a large discrepancy between the anticipated budget and the actual financial outcome in fiscal 2012.
"If you look at page 68, you actually see that we actually underspent our budget by $2.7 million," said Hoover. "You're not going to see this every year and it's hard to call it a surplus when we have pension liabilities and things like that, so it's not."
In addition to the financial audit, Baxter Dansereau & Associates also conducted an Audit of Compliance to report on the Town's internal control and compliance with any federal grants that it receives.
"I'm glad to say there are no compliance issues in the funds we did select to review and also there were no major issues on the financial end of the audit either," said Dansereau. "It's called an unqualified opinion."
"An unqualified opinion is exactly what we were looking for," said Council President Cote. "I'm glad it was accepted that way."
See the attached PDF document to view the complete audit.