Auditors Give Glowing Report on Grosse Pointe Farms Finances

In a brief presentation to council Monday, auditors from Plante Moran complimented officials for their level of cooperation and their financial condition. 

The auditors provided an hourlong detailed summary of their work to the council's finance committee prior to the normal council meeting. The committee is typically made up of three council members but currently has a vacancy following the . Mayor James Farquhar and Louis Theros heard the detailed report.

Plante Moran Partner Mark Hurst told council the Farms is one of fewer than 60 communities throughout Michigan that willingly provides auditors with more information than required to complete the annual audit. 

Not only is that appreciated by the auditors, he said, but it makes the Farms worthy of recognition from the federal reporting organization. The Farms received a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association, which is given to those governmental agencies that achieve the highest standards in financial reporting.

Hurst also said the completion of the audit before the end of the calendar year shows just how smoothly it went rather than after the new year begins, which is more typical.

The Farms hired a new comptroller in the 2010/2011 fiscal year, John M. Lamerato. Hurst highlighted the smooth transition from the previous comptroller to Lamerato, noting often times there is a bit of disruption because of such a change. 

"We are very thrilled with the results," Hurst told council.

The auditors spent 500 to 600 hours mulling over financial records for the audit, he said. Plante Moran Associate CPA Kari L. Shea walked council members through the 88-page comprehensive annual financial report before ending the presentation. The report will be available on city's website later this week. 

Officials also reminded residents that there is a financial dashboard on the city's website that is part of the state's financial reporting requirements. 

Lamerato said the city ended the 2010/2011 fiscal year about $110,000 under budget, which is a good position to be in. The total budget was $14.2 million and the surplus or underspend is less than one percent, which means officials made good predictions and estimates on expenditures, Lamerato said.

"This shows an accurate reflection of what would happen (in the fiscal year)," he said.

Each department came in under budget, the largest of which was by the recreation department at an underspend of $94,342. 

The unassigned portion of fund equity ended the fiscal year with a $2.9 million balance, which is about 23 percent of the general fund budget, Lamerato said. Municipalities are generally recommended to have about 10 to 20 percent of the total general fund in unassigned fund equity balance, he said, explaining the few percentage points higher shows the Farms is in good financial shape.