Marion’s clean audit carries familiar warning
Staff writer
A recommendation auditors made last year, that Marion seek higher returns on idle cash balances, resurfaced Monday despite the city receiving a clean audit for 2025.
Christina Henson of the Loyd Group told council members the city could earn significantly more interest on money not needed for immediate expenses by using certificates of deposit, money market accounts, or the Kansas Municipal Investment Pool.
“There is a lot of opportunity right now,” she said, “a lot of these other places that can get you anywhere from 3.5% to 4% interest income on those idle balances.”
Auditors made a similar recommendation last year.
Henson said checking accounts typically earn between 0.25% and 0.5% interest, substantially less than rates available through other investment vehicles.
“This has been touched on a little bit in the past before you got here,” Powers told City Administrator Brian Wells. “Probably something we ought to talk about.”
Auditors also repeated a recommendation regarding documentation of journal entries.
“Nothing that we saw were inappropriate journal entries,” Henson said. “It was just that it needs one more piece of paper to go with it. Basically the ‘why’ behind it.”
She said supporting documentation could be as simple as a memo, screen printout, or other paperwork explaining the reason for an adjustment.
A new recommendation this year involved the city’s year-end bank reconciliation.
Henson said year-end reconciliation was finalized before all year-end transactions had been recorded. While auditors found no problems, she recommended waiting until all year-end activity was complete before finalizing reconciliation.
Overall cash balances declined during the year, primarily because of activity within utility funds and transfers used to support the general fund. Henson said the city had authority to transfer as much as $490,000 but ultimately transferred $250,000.
She encouraged the city to continue monitoring cash balances, utility revenues, expenditures, and fee structures as they prepare future budgets.