Because I'm a stickler for time, it's it's uh 7 a.m.

or 7 p.m.

a.m.

would be different.

Um I will go ahead and call the finance committee meeting to order for uh Monday, September 14th.

Uh the first order of business is the review and approval of the July 6th, 2026 Finance Committee meeting.

Um without objection, they are approved.

Um and then the next uh docket item uh is a communication and review of the annual comprehensive financial report to the city of Lakewood uh for the audit uh period January 1, 2025 through December 31, 2025, uh showing to like codified ordinances 160.03.

And for folks that follow the finance committee and our uh financial controls will note that um earlier this year we amended the Lakewood codified ordinances to basically do away with uh a citizen audit committee and we assigned the audit committee tasks to the finance committee uh of city council.

Um so every year the city uh has an audit or either uses the auditor state or has a private audit firm uh audit our financial statements and our financial controls uh and they produce a report.

Um we've talked about it a little bit uh that before the audit is released, we can technically do an audit conference that's um exempt from the open meetings act.

So uh council members could ask and audit committee members could ask pointing questions in a non-public meeting uh and executive session if they wish to, or we could simply wait until the audit is finalized uh with the auditor state's office and have a public meeting where we can ask public questions to the auditors and to the finance director uh about the audit.

And we went with the second route here, so the audit is uh posted on the auditor states website.

We also got a copy of it on council.

Um so that's a lot of uh preamble to to why we're here tonight.

Um but generally speaking, uh the audit was clean.

Um and we have uh Kyle Doherty and uh Devin Bernard from um Zubka and Associates.

I say that correct.

I say your names correctly.

Okay, great.

Um so we welcome them here this evening to answer our questions.

We also have uh Director Mahoney and Director Vargo present.

Um I I guess you know, I I uh as I understand that the auditors don't have like a uh a presentation uh to give, but I I think I would want to turn it over to them just to kind of hear high level um what their experience is with Lakewood, uh what the audit represents in speaking with them before the meeting.

Um the City of Lakewood has used the firm's upgun associates for a couple of years for our audit.

Sometimes the state auditor does audits with their own staff, and sometimes they provide municipalities and local governments the ability to hire uh independent um auditors, uh I think IPAs, independent public accountants, um, to do this work, uh, which you know they basically I'll let them explain, but from what I understand, you know, come and have full range of viewing financial controls documents, double checking things that the city has, double checking ledgers accounts to make sure that everything matches up with um with what we put out there uh to ensure that we have the right controls in place.

Um so at this point I'll I'll turn over maybe Director Mahoney or uh Kyle or Devin to kind of go through the audit and where we're at.

Oh, it's on line.

There we go.

Uh good evening, everyone.

Apologize for my uh microphone deficiency there.

Uh I'm Kyle Doherty, I'm the audit partner at Supkin Associates.

Um with me is Devin Bernard.

He was the uh senior auditor in charge of the uh uh the field work of the audit and perform most of the day-to-day uh work um while I was the uh one in in charge of reviewing everything and then uh the final approval of the uh auditors report.

Um so tonight what I was gonna do is kind of run through a high level of what our process is and the different reports that we issue um that are part of the annual comprehensive financial report.

Um I'd be happy to answer any questions as I'm going through things, um feel free to interrupt me, or um certainly when I'm when I'm done, we'll be open to taking any any questions about the uh reports or the audit process.

So um in summary, there's a few different audit reports that we issue or reports that we issue as part of the audits.

Um the first one is what's titled the independent auditors report.

So that's the main one where we're looking at the financial statements.

So the main uh point there is that we had a clean or unmodified opinion on the financial statements, which means that we believe that they are fairly presented in all material respects.

The second report that we issue is our report on internal control over financial reporting and compliance.

Um there is that we did not identify any significant deficiencies or material weaknesses in internal control over financial reporting, and we did not identify any material noncompliance.

And the third main report is the report on compliance for each meteral each major federal program.

Um so what that is is um since the city expended more than um one million dollars in federal funds, we're required to have a compliance audit done.

And so we look at certain um federal programs, review those for certain compliance points.

Um we had a an unmodified or clean opinion over compliance for those programs, and we did not identify any significant deficiencies or material weaknesses in internal control over compliance.

And the last couple of things I'll mention is um before I get into the more detail is um we also issue would would potentially issue a management letter, that's where we would have any um comments that aren't a um significant deficiency or material weakness in internal control.

I'll kind of describe what those mean a little bit later on.

Um but if there was any other matters that we wanted to bring it to attention of management and governance.

Um, we didn't have any management letter comments for uh the 2025 audit.

And last thing we have a letter that we um issue to the governing body, what we call our required communication letter, just kind of goes over certain other matters um with the audits, if there it were any other issues that we encountered or that sort of thing.

But um we didn't have any any issues in performing the audit.

So go through each of those a little bit more detail.

The independent auditors report, um, again, that's where we're issuing our main opinion over the financial statements, um where we had the unmodified or clean audit opinion.

Um thing I'll point out is that the way um government financial statements are prepared is that they're broken out into what we call opinion units.

Um essentially it breaks out each of the major funds of your um the city's operations and then lumps together all the other funds into one what we call opinion units.

So we're actually kind of doing almost several audits of different sets of financial statements simultaneously.

So there's like the general fund, other major special funds, um, and then all the other other opinion units, all the other funds are lumped together as an opinion unit.

So again, we had a uh unmodified opinion in uh over all those different opinion units.

Um we conduct the audit um following generally accepted auditing standards as well as government auditing standards.

Um the report also mentions management's responsibilities over the financial statements, um ultimately management's responsible for the preparation of the financial statements and for uh maintaining relevant internal control over financial reporting.