State auditors issue clean opinion on city's 2025 financial statements

State auditors told city officials Friday that they will issue an unmodified (clean) audit opinion on the city's financial statements for the year ended Dec. 31, 2025, and reported no material misstatements or compliance issues that would affect the statements.

"We are issuing an unmodified clean audit opinion on the city's financial statements," Tony Quas, the lead auditor on the engagement, said during the exit conference. He said the audit covered the period Jan. 1, 2025, through Dec. 31, 2025, and was conducted in accordance with government auditing standards. The auditors also noted the city prepares its financial statements using U.S. generally accepted accounting principles (US GAAP).

The auditors told city staff they found no reportable weaknesses in internal controls that rose to the level required for inclusion in the audit report. "We did not identify any concerns in the city's processes that were required to be brought to your attention or included in our report," Quas said, specifically mentioning that procedures designed to detect management override of controls did not result in recommendations.

Auditors said they identified no material misstatements that required correction during the audit. They also provided the city with a list of uncorrected items that they characterized as immaterial or small in nature and said management has been informed and is expected to address those items in future statements.

The audit team issued the Annual Comprehensive Financial Report (ACFR) letter on Jan. 25, 2026, and reviewed schedules related to the Government Finance Officers Association (GFOA) certificate of achievement program; the ACFR letter will be included in the city's final annual report and any award submission. Audit costs were reported to be in line with the original estimate.

Lisa Carroll, audit manager for Team Olympia, said the auditors will conduct a separate accountability audit later this year, likely in late summer or fall, and that the audit office will post the full financial statement report to its website in the coming days. She also said the office will email the ACFR letter to city staff for the GFOA submission and will send a customer service survey when the reports publish.

City officials thanked the audit team and acknowledged staff contributions to completing the audit, singling out Chelsea Knight, the deputy finance director, and Alex Turkot, the accounting manager, for timely assistance. With no further questions, the auditors closed the exit conference.