International Falls is in good fiscal shape, according to the results of a 2011 audit.
Don Zierke, certified public accountant with Miller McDonald Inc., reviewed the audit with the city council Friday in a brief meeting.
Zierke told the council that the city received an “unqualified” rating. “It’s the best you can get from me or any other CPA,” Zierke told the council.
City Administrator Rod Otterness echoed Zierke’s conclusion and credited Assistant Administrator Betty Bergstrom, who he said picked up budget duties when the city eliminated a budget director position.
“The city’s financially strong even though we are aware of challenges, especially with state aids,” said Otterness.
The audit includes the following highlights:
• The assets of the city exceeded liabilities at Dec. 31 by $43.7 million.
• Net assets decreased by 2.68 percent from the prior year.
• The city’s governmental funds reported combined ending fund balances of $10.1 million. Of this total amount, about 19 percent is available for spending at the city’s discretion.
• At Dec. 31, the unassigned fund balance for the general fund was $3.1 million or 62 percent of total general fund expenditures of $5.1 million.
• The water and sewer enterprise fund of the city earned $157,758 from operations. Net assets decreased by $155,792, primarily because of net transfers out of $380,133.
Zierke noted that overall, the neutral budget showed that inflows equaled outflows, except for a $318,416 deficit.
Asked whether that deficit was abnormal, Zierke said it was not abnormal. He said the deficit was because the city had budgeted for an amount of local government aid from the state that it did not receive when the state cut its contribution because of a state budget deficit.
