2025 Annual Comprehensive Report

CITY OF GREENSBORO, NORTH CAROLINA SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED JUNE 30, 202 5

SECTION II FINANCIAL STATEMENT FINDINGS AND RESPONSES (CONTINUED)

2025-001

Restatement of Prior Year Balances (Continued)

Recommendation: We recommend the City carefully review the financial statements and the applicable reporting requirements under GAAP to ensure that all information and financial data is properly reported.

Auditee's Response: We concur with the finding.

2025-002

Revenue Recognition

Criteria: Internal controls should be in place to ensure that amounts reported as revenues and related accounts are appropriate, properly valued, and recorded in the proper period in accordance with generally accepted accounting principles.

Condition: Internal controls were not sufficient to timely detect material misstatements in the City’s revenues and related balances.

Context/Cause: During our audit for the year ended June 30, 2025, an audit adjustment in the amount of $11,000,000 was required to correct the revenue and deferred inflows in the State and Federal Grants special revenue fund. The City had overstated the current period deferred revenues for grant awards and, therefore, did meet applicable revenue recognition criteria as stipulated by GASB Statement 33, Accounting and Financial Reporting for Nonexchange Transactions.

Effects: An audit adjustment of $11,000,000 was needed to correct the City’s revenue and related balances as of and for the year ended June 30, 2025.

Recommendation: We recommend the City carefully review all grant revenues and related deferred revenues to ensure they are reported in accordance with GASB Statement 33, Accounting and Financial Reporting for Nonexchange Transactions.

Auditee's Response: We concur with the finding.

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