Audit confirms Kerr-Tar improved

Jan. 30, 2014 @ 05:50 PM

The Kerr-Tar Regional Council of Governments is still climbing out of the red, recovering from a $500,000 deficit in its unassigned general fund balance.

The situation is still the same: no unassigned cash available to spend.

Kerr-Tar did receive passing grades from independent auditors on how it is reporting on its revenue and expenditure accounts, according to a report delivered on Thursday by Eddie Burke of Cherry Bekaert LLP auditors.

Burke said the move on the unassigned fund problem is in the right direction, from a $496,162 debt to a negative of $239,365 when comparing fiscal year 2012 with 2013.

“You made significant progress, but you want to get that closer to zero and then actually make progress into the positive,” Burke said. “What the negative balance means is that you will have to cut programs if there is a shortfall in those federal and state dollars.”

Assessing the governmental fund totals reveals the budgets for Karr-Tar include revenues of nearly $6 million and expenditures at $5,831,789. For the previous year, those numbers were largely reversed, with expenditures overrunning revenues by more than $220,000.

Burke gave Kerr-Tar leaders high marks for reversing that trend and turning the tide in several other budgeting areas.

“You made progress on the liquidity issue, but you are not where you need to be,” Burke said.

A rundown on Kerr-Tar budget numbers included assets up $140,000 and liabilities down about $50,000.

“That was primarily two things,” Burke said. “Cash increased by about $50,000 primarily because of member assessments during the year.”

The notes receivable category was boosted by a new $110,000 grant more than offsetting decreased federal funding of programs for the aging.

Total revenues increased $332,000 mainly from increased local government dues. New member assessments took place as part of a campaign to resolve a prior-year fund issue.

Meanwhile, the total on expenses decreased by about $150,000. The shift leaned on decreases in economic and physical development, human services and workforce development, offsetting increased expenditures to transportation and public safety programs.

Net assets increased by about $192,000 to $1,094,052.

Burke said the terminology for passing grades on budget reports changed from previous years.

“The old term is ‘unqualified’ and the new term is ‘unmodified,’ but it means the same thing,” Burke said. “The objective of every audit is to obtain reasonable, but not absolute, assurance that the financial statements are free from material misstatements.”

Contact the writer at