Naples' fiscal 2025 audit reports a general fund balance $875,018 above the state maximum
Naples' fiscal 2025 audit reports one compliance finding: the city's unrestricted general fund balance exceeded the 35% maximum in state law by $875,018. The city said it would adopt the auditors' recommendation.
Continuing story: Auditing Naples
Naples held more in its general fund at the end of fiscal 2025 than state law allows, according to the city's audit. [1]
Utah Code 10-6-116 requires cities to keep their unrestricted general fund balance between 5% and 35% of total revenues for the fiscal period, the audit says. For the year that ended June 30, 2025, Naples' balance exceeded the maximum by $875,018. [1]
What the auditors said
The finding, numbered 2025-1, recommends that the city review its processes for keeping general fund balances within the law before each fiscal year-end. The city's response says it will adopt the recommendation. [1]
In their state compliance report, the auditors say Naples complied in all material respects with the requirements they tested, with the exception of item 2025-1, and that their opinion is not modified for it. The report on internal control over financial reporting lists no findings. [2][1]
At the council's Dec. 11, 2025 meeting, the auditor's representative gave a preliminary report on the fiscal 2025 audit and said it appeared there were no significant findings, according to the minutes. The council voted to approve the report. The final audit report is dated Dec. 30, 2025. [3][2]
The general fund
The general fund ended fiscal 2025 with $2,328,717, down $64,182 from the year before. Of that, $2,142,561 was unassigned. The fund took in $3,850,759 in revenue and transferred $784,290 to other funds. [4]
The audit notes say the transfers went to the debt service fund ($139,025), the trail projects fund ($135,265) and the road capital projects fund ($510,000). [6]
Fiscal 2026
On June 25, 2026, the council amended the fiscal 2025–26 budget, setting the general fund at $4,007,200 and the vitalization fund at $605,000. [5]
The budget worksheet the city filed with the State Auditor lists a $600,000 general fund transfer to the vitalization fund in its fiscal 2026 actual column. Those fiscal 2026 figures are unaudited. [7]
A fund balance above the statutory maximum is a compliance finding about how much the city holds in reserve.
Sources
- City of Naples · Annual Financial Report FY2025, findings and responses
- City of Naples · Annual Financial Report FY2025, state compliance report
- Naples City Council · Dec. 11, 2025 minutes
- City of Naples · Annual Financial Report, fiscal year ended June 30, 2025
- Naples City Council · June 25, 2026 minutes
- City of Naples · Annual Financial Report, fiscal year ended June 30, 2025
- City of Naples · Budget worksheet filed with the State Auditor, printed Aug. 18, 2026
Reporting by The Utah Ledger from the public records above. AI-assisted, checked against those records.