Osceola County receives good news on 2016 audit
REED CITY — There weren't too many changes in revenues and expenditures for Osceola County from 2015 to 2016.
However, county government officials are required to have an audit done to make sure their financial practices are in accordance with state and federal laws.
During the Osceola County Board of Commissioners meeting on June 6, Ken Talsma, of Anderson, Tackman and Company, announced the findings of the 2016 audit of the county's finances.
Pointing out there are different accounting rules and standards for the state and federal governments, Talsma told commissioners the annual audit is done to make sure assets, liabilities, revenue expenditures and fund balances are confirmed by a third party.
"It is our opinion, the county received an unmodified opinion," he said. "It sounds like it's something bad, but it's the best opinion you can get. It means everything is being done properly in accordance with all the accounting rules and all of the evidence backs up the numbers.
"Everything is accurate, as it should be."
Talsma said the county also had a single audit performed, a requirement for governmental bodies receiving more than $750,000 in federal funds. The county received an unmodified opinion on that audit as well.
Talsma also provided a comparisons between 2015 and 2016. He highlighted:
- An increase in pension liability, as it went from $3.65 million in 2015 to $4.05 million in 2016. "It seems Municipal Employees Retirement Services has gotten more true assumptions and have a more real number about the inflows and outlfows, as well as changes in investment plans and experience," he said. "It bumped it up a bit, but I do not see this is going to be a common trend moving forward. What they are using seems more realistic." The county budgeted $20,000 for its retirement contribution for 2017. However, in March, officials contributed $80,000 more to lower its future liability. The rate of return with MERS is better than a traditional savings account or other investments, Osceola County Clerk Karen Bluhm said at the time.
- A small increase in investment assets from $3.55 million in 2015 to $3.75 in 2016. Talsma noted, "That will increase as the stock market is doing better. The value of investment will be better. 2015 was a bad year for the stock market, 2016 was quite a bit better and 2017 is looking better. That will help with your investments."
- The fund balance of the county's general fund. It has decreased from $3.54 million in 2012 to $2.6 million in 2016. "You dipped into the fund balance a little bit. Still, even after five years, we are still at about 22 percent of budget expenditures. You're still in a safe spot. Between 10 to 15 percent is the floor. Twenty-two percent is good. You don't want these trends to keep going down." Talsma said the Michigan Treasury may send a letter asking officials to explain why the fund balance has decreased over the last five years.