Bella Vista Receives Third Party Opinion in 2023 Financial Audit
The City of Bella Vista has recently undergone an independent financial audit for the year ending December 31, 2023, conducted by Forvis Mazars, LLP. The audit, which reviewed the city's financial statements, provided an unmodified opinion on the regulatory basis of accounting, indicating that the financial statements present a fair and accurate view of the city’s financial position.
Key Findings of the Audit
Unmodified Opinion on Regulatory Basis of Accounting: The auditors issued an unmodified opinion, meaning that the financial statements of the City of Bella Vista were found to be free of material misstatements and fairly presented the financial position of the general fund, street fund, and other funds in the aggregate as of December 31, 2023. This positive outcome reflects the city's compliance with the accounting practices prescribed or permitted by the State of Arkansas.
Adverse Opinion on U.S. Generally Accepted Accounting Principles (GAAP): While the audit provided an unmodified opinion based on the regulatory basis of accounting, it issued an adverse opinion when evaluated against U.S. Generally Accepted Accounting Principles (GAAP). This is due to the differences between the regulatory basis of accounting used by the city and the GAAP standards, which are more stringent. The auditors noted that the financial statements, when compared to GAAP, do not present the city's financial position as accurately as they do under the state's regulatory requirements.
Audit Methodology and Responsibilities
The audit was conducted following generally accepted auditing standards (GAAS) in the United States and Government Auditing Standards issued by the Comptroller General of the United States. These standards required the auditors to maintain independence and to perform the audit with professional skepticism and judgment.
The auditors’ responsibilities included:
Assessing the risks of material misstatements in the financial statements, whether due to fraud or error.
Evaluating the appropriateness of accounting policies and the reasonableness of significant accounting estimates made by the city’s management.
Considering the city’s internal control over financial reporting as part of designing the audit procedures.
Additional Reporting and Compliance
In addition to the audit of the financial statements, the report included supplementary information, such as the schedule of expenditures of federal awards, which was found to be fairly stated in relation to the basic financial statements.
The auditors also issued a report on the city’s internal control over financial reporting and compliance with applicable laws, regulations, contracts, and grant agreements. This report did not provide an opinion on the effectiveness of the city’s internal controls but described the scope of testing and the results.
Conclusion
The audit of Bella Vista's financial statements for 2023 demonstrates the city’s adherence to state accounting practices, while also highlighting areas where the financial reporting could differ under more rigorous GAAP standards. The findings offer assurance to the city’s stakeholders that the financial statements accurately reflect the city's fiscal operations under the regulatory framework, with careful attention to compliance and financial integrity.
This financial audit serves as a crucial tool for city management and the City Council to continue their work in maintaining and improving Bella Vista’s financial health and transparency.
