Rockford, TN Posts $232K FY 2026 Surplus Amid Internal Control Audit Findings
ROCKFORD, Tenn. — The City of Rockford’s annual financial audit for the fiscal year ended June 30, 2026, delivered an unmodified (“clean”) opinion from CPA firm Coulter & Justus, P.C., highlighting strong fiscal reserves alongside two internal control findings.
Strong Surplus and Zero Debt
Rockford’s total net position grew by $232,861 to reach $3,235,460, while the General Fund balance rose to $2,730,797. The city remains completely debt-free, holding $504,663 in net capital assets and $2,394,404 in unassigned reserves—representing 574% of total annual expenditures.
Total revenues reached $629,778 (up $70,772), led by $495,283 in sales taxes and $55,560 in interest earnings after officials moved cash into a higher-yielding account. Operational expenses totaled $396,917.
Audit Findings & $1 Rockford Manufacturing Lease
Auditors identified two material weaknesses in financial reporting controls:
- Year-End Accruals (Finding 2026-001): Delayed cash-versus-accrual accounting during a key personnel transition required a prior-period restatement, reducing initial FY 2025 net position by $31,911.
- Improper Leasehold Capitalization (Finding 2026-002): Since 1970, Rockford has occupied City Hall and four surrounding acres under an informal verbal agreement for $1 per year with Rockford Manufacturing Company, Inc. Because the agreement is cancellable upon notice and lacks a fixed term or legal leasehold rights, auditors ruled that past property improvements could not be capitalized as municipal assets.
City Recorder April Payne confirmed management concurred with the audit findings and immediately implemented corrective accrual and capitalization controls.
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