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Storyline · 14 events · Feb 21, 2023 – Oct 2026

Amarillo's move toward a third-party forensic audit of City financial records (2022-2026)

The City's annual audited financial reports for fiscal years 2022-2024 each restated beginning balances, and the City moved to new financial software in January 2025. The fiscal 2025 annual audit, by a new audit firm, was issued June 4, 2026; in February 2026 the council had tabled a $30.31 million street certificate of obligation while that audit was under way. When the report was filed on June 23, 2026, staff identified about $43 million in the community investment program fund for allocation and public commenters asked for a forensic audit. On July 14 the council directed the audit committee to vet third-party firms; the City issued a request for quotations on August 11 as staff described software-report errors requiring an ACFR footnote correction. In September the committee split the work into water/sewer and community-improvement components, with a recommendation expected in October 2026; a 'Forensic Audit Update' is on the October 13 council agenda.

A storyline groups dated events in order. It is a chronology, not an argument; it does not say why anything happened. All storylines

Where the story starts depends on the framing

  1. · Context

    FY2022 annual audit issued with an unmodified opinion and a lease-accounting restatement

    The independent auditor's report on the City's financial statements for the year ended September 30, 2022 is dated February 21, 2023 and states an unmodified opinion. Beginning net position was restated to apply the new GASB 87 lease standard retroactively.[1]

    • ✓ Verified

      The independent auditor's report on the City's fiscal 2022 financial statements, dated February 21, 2023, states that the statements present fairly, in all material respects, the City's financial position (an unmodified opinion). It notes the City adopted GASB 87 (leases) in 2022 and that the opinion is not modified with respect to that matter.[1]

    • ✓ Verified

      The fiscal 2022 ACFR restated governmental-activities net position at September 30, 2021 by -$590,549 to apply GASB 87 retroactively.[1]

      Restatement
      -$590,549

  2. · Context

    FY2023 annual audit issued; business-type net position restated for a depreciation correction

    The auditor's report on the fiscal 2023 statements is dated February 27, 2024. Note 1 records a $3,383,736 accumulated-depreciation correction to business-type net position after the City's fixed-asset subledger over-depreciated assets, alongside a GASB 96 subscription-IT restatement.[2]

    • ✓ Verified

      The fiscal 2023 ACFR (auditor's report dated February 27, 2024) records an accumulated-depreciation correction of $3,383,736 to business-type net position at September 30, 2022, stating that the City's fixed-asset subledger had over-depreciated fixed assets; it also records a GASB 96 (subscription IT arrangements) restatement to governmental activities.[2]

      Depreciation correction
      $3,383,736

  3. · Origin

    City switches to new financial software

    According to City staff as reported in August 2026, the City switched to new financial software in January 2025. Staff later said the software ran a report differently than staff were used to, causing cash-flow figures that needed correction.[3]

    • ✓ Verified

      On August 15, 2022 the City issued $7,345,000 in Tax Notes, Series 2022B, for acquiring enterprise resource planning software and constructing and improving fleet fuel islands, maturing through 2029.[4]

      Amount
      $7,345,000
    • ✓ Verified

      City staff: City staff said the City switched to new financial software in January 2025 and that the software ran a report differently than staff were used to, which caused cash-flow figures that needed correcting.[3]

  4. · Precursor

    FY2024 annual audit issued; prior period adjustment for completed CIP projects not depreciated

    CMMS CPAs & Advisors PLLC's report on the fiscal 2024 statements, dated March 25, 2025, states an unmodified opinion. Note 1 records prior period adjustments of $3,252,499 (governmental) and $227,482 (business-type) because certain construction-in-progress projects had been placed in service without depreciation being started, plus $359,828 for GASB 96 and GASB 87 items.[5]

    CMMS CPAs & Advisors PLLC

    • ✓ Verified

      The fiscal 2024 ACFR states that during 2024 it was determined that certain construction-in-progress (CIP) projects had been placed in service but depreciation had not been started, resulting in prior period adjustments of $3,252,499 for governmental activities and $227,482 for business-type activities; a separate $359,828 adjustment related to GASB 96 ($52,071) and GASB 87 ($307,756) in the Information Services internal service fund.[5]

      Governmental adjustment
      $3,252,499
      Business type adjustment
      $227,482
      Gasb96 87 adjustment
      $359,828
    • ✓ Verified

      The fiscal 2024 independent auditor's report, on CMMS CPAs & Advisors PLLC letterhead and dated March 25, 2025, states an unmodified opinion.[5]

  5. · Related development

    Council tables a $30.31 million street certificate of obligation while the annual audit is under way

    At its February 10, 2026 meeting the council approved about $11 million in debt for a fire truck and water and sewer projects but tabled a certificate of obligation of up to $30,310,000 for streets and related infrastructure. Officials said the City was undergoing an audit and wanted to see whether it had money on hand to use instead of borrowing.[6][7]

    Cole StanleyDon Tipps

    • ✓ Verified

      The City's notice of intention set the February 10, 2026 meeting to consider Series 2026A certificates of obligation not to exceed $30,310,000 for park and recreation facilities and street improvements, with estimated combined principal and interest of $43,883,993.[6]

      Not to exceed
      $30,310,000
      Est principal and interest
      $43,883,993
    • ✓ Verified

      The council tabled the roughly $30 million certificate of obligation; officials said the City was undergoing an audit and wanted to see whether it had money on hand to use instead of borrowing, and that the money was not needed until the summer budget process. The same day the council approved about $5 million for a fire truck and about $6 million for water and sewer projects.[7]

    • ✓ Verified

      Councilmember Don Tipps: Councilmember Don Tipps compared a certificate of obligation to a credit card, saying the City was locking in costs because it lacked the cash to pay outright.[7]

  6. · Context

    Council approves the street certificates of obligation

    NewsChannel 10 reported on March 13, 2026 that the council approved more than $30 million in certificates of obligation for street construction and maintenance, including $12 million for the 2026 summer street maintenance program and $16 million for Osage Street from 34th to 58th Street.[8]

    Cole Stanley

    • ✓ Verified

      NewsChannel 10 reported on March 13, 2026 that the council approved more than $30 million in certificates of obligation for streets: $12 million for the 2026 summer street maintenance program and $16 million for Osage Street from 34th to 58th Street. The report does not mention the audit or give a vote count.[8]

      Summer maintenance
      $12,000,000
      Osage street
      $16,000,000

  7. · Precursor

    FY2025 annual audit issued by a new audit firm with an unmodified opinion

    CliftonLarsonAllen LLP's report on the fiscal 2025 statements is dated June 4, 2026 and states an unmodified opinion; it notes the fiscal 2024 statements were audited by other auditors. Beginning balances were restated for reporting-entity changes (the Amarillo Convention and Visitors Bureau no longer reported as a component unit; the COVID-19 relief fund reported as non-major).[4]

    CliftonLarsonAllen LLP

    • ✓ Verified

      CliftonLarsonAllen LLP's independent auditors' report on the fiscal 2025 statements, dated June 4, 2026, states an unmodified opinion and notes that the fiscal 2024 statements were audited by other auditors whose report was dated March 25, 2025.[4]

    • ✓ Verified

      The auditor's report dates for the City's last four ACFRs were February 21, 2023 (FY2022), February 27, 2024 (FY2023), March 25, 2025 (FY2024) and June 4, 2026 (FY2025).[1][2][5][4]

    • ✓ Verified

      Note 28 of the fiscal 2025 ACFR restates beginning balances because the Amarillo Convention and Visitors Bureau Inc. is no longer part of the City's reporting entity (component-unit net position reduced by $3,079,487) and the COVID-19 relief fund ($1,026,645) moved from a major to a non-major fund.[4]

      Cvb component unit removed
      $3,079,487
      Covid fund reclassified
      $1,026,645
    • ✓ Verified

      The City check register records 10 payments totaling $239,997 to CMMS CPAs & Advisors PLLC between 2024-09-12 and 2025-11-06, and 10 payments totaling $280,008.78 to CliftonLarsonAllen LLP between 2025-09-11 and 2026-05-18. The register begins in July 2022 and does not tie payments to a specific audit or engagement.[9]

      Cmms total
      $239,997
      Cmms payments
      10
      Cla total
      $280,009
      Cla payments
      10

      See the payments in the check register →

    • ✓ Verified

      The same portal lists an earlier solicitation, 'RFQ-311-25 ML,' 'City Financial Audit Services,' that closed May 15, 2025. The listing does not name the firm selected; no fetched source ties this solicitation to the City's change of annual auditor.[10]

  8. · Trigger

    FY2025 ACFR filed; public commenters ask for a forensic audit

    Auditors from CliftonLarsonAllen presented the fiscal 2025 report, noting nine findings regarding federal and state grants, one described as significant. A first vote to accept the report tied; the council then unanimously filed it with the City Secretary. Staff had identified about $43 million in the community investment program fund available for allocation; public commenters asked for a forensic audit, and council members expressed support but wanted cost information.[11]

    Cole StanleyTim ReidLes SimpsonAndrew FreemanCliftonLarsonAllen LLP

    • ✓ Verified

      CliftonLarsonAllen auditor: At the June 23, 2026 meeting, a CliftonLarsonAllen auditor pointed out nine findings regarding federal and state grants, one of which he described as significant, related to an airport grant: the auditors could not identify which capital assets were federally funded.[11][12]

      Grant findings
      9
      Significant findings
      1
    • ✓ Verified

      The first vote to accept the fiscal 2025 ACFR was tied, with Mayor Cole Stanley and Councilmember Tim Reid voting no; Reid said his concern was that the report did not have findings. The City Attorney said state law only requires the report be filed with the City Secretary, and a motion by Stanley to file the final draft passed unanimously. The council had tabled the report at its previous meeting because not all members had reviewed it.[11]

    • ✓ Verified

      After a presentation by Deputy City Manager Andrew Freeman on how community investment program projects are closed out (159 projects closed out in this audit), staff identified around $43 million in the community investment program fund that the council could allocate in the upcoming budget, pending the closure process and reserve recalculation.[11]

      Cip available
      $43,000,000
      Projects closed
      159
    • ✓ Verified

      The Amarillo Tribune reported that the $43 million figure, together with the City having a new Chief Financial Officer, prompted a few public commenters to request a forensic audit; Mayor Stanley asked whether the council was interested, and council members all expressed support but wanted to know the cost first.[11]

  9. · Context

    Fiscal 2025 single audit filed with nine federal-program findings

    The Federal Audit Clearinghouse accepted the City's fiscal 2025 single audit, performed by CliftonLarsonAllen, on June 30, 2026. It reports $43,197,490 in federal expenditures and nine findings on federal programs: four in the Housing Choice Voucher program, three in the Airport Improvement Program, one in the SAFER fire-staffing grant and one in Community Development Block Grants. None reports questioned costs or is marked as a repeat finding. The City was not designated a low-risk auditee for fiscal 2025, after being so designated for fiscal 2024.[12][13]

    CliftonLarsonAllen LLP

    • ✓ Verified

      The FAC record for the fiscal 2025 single audit lists nine findings (2025-002 through 2025-010): Housing Choice Voucher cluster - late HUD 50058 submissions (3 of 40 tested), undocumented SEMAP certification review, one housing assistance payment before a rent-reasonableness determination, and no documented independent review of the utility allowance schedule; Airport Improvement Program - fixed-asset records that do not identify federally funded assets (2025-006), FAA Form 5100-127 line items that did not agree to the general ledger, and no written airport revenue-use policy; SAFER - no documented independent review of a performance report; CDBG - first-tier subawards over $30,000 not reported under FFATA (2025-010). Each lists questioned costs: none, and repeat finding: no.[12]

      Findings
      9
      Federal expenditures
      $43,197,490
    • ⚠ Sources differ

      Sources classify the severity of findings 2025-006 (airport property records) and 2025-010 (CDBG subaward reporting) differently.

      Reported value 1[12]

      Classification
      material weakness

      The finding texts filed with the FAC describe 2025-006 as 'Material Weakness in Internal Control over Compliance and Material Noncompliance' and 2025-010 as 'Material Weakness in Internal Control over Compliance and Noncompliance'; the other seven are described as significant deficiencies.

      Reported value 2[12]

      Classification
      significant deficiency

      The FAC's structured findings table flags all nine findings as significant deficiencies and none as material weaknesses.

    • ✓ Verified

      Finding 2025-006 states that the City's fixed asset ledger 'does not identify or distinguish assets acquired with federal award funds from assets acquired with other funding sources,' because the fixed asset system 'was not configured to capture funding source and federal participation information.' This corresponds to the airport-grant finding the CliftonLarsonAllen auditor described to the council on June 23, 2026 as significant.[12][11]

    • ✓ Verified

      The FAC records show the City as a low-risk auditee for fiscal 2024 and not a low-risk auditee for fiscal 2025. The fiscal 2024 single audit (CMMS CPAs & Advisors) had one finding, 2024-002, on recovery-fund reporting.[13][12]

    • ✓ Verified

      None of the nine fiscal 2025 findings reports questioned costs, and finding 2025-008 states that 'no specific instances of revenue diversion were identified.'[12]

  10. · Starting point

    Council discusses a forensic audit and directs the audit committee to vet third-party firms

    The council discussed the scope of a possible forensic audit covering capital improvement projects, water and sewer, and ARPA funds. The audit committee said it would vet and recommend a third-party firm to the full council before any forensic audit proceeds; staff were directed to call a special meeting in August. Some council members said they had not seen issues with funds.[14][15]

    Cole StanleyLes Simpson

    • ✓ Verified

      On July 14, 2026 the council discussed a possible forensic audit including capital improvement projects, sewer and water, and ARPA funds. NewsChannel 10 reported that for months council members and citizens had raised questions about past financial records, including where funds came from and where they went.[14]

    • ✓ Verified

      The audit committee said it would vet and recommend a third-party firm to bring before the full council before any forensic audit moves forward, and the council directed staff to call a special meeting in August. No vote count was reported.[14]

    • ✓ Verified

      Mayor Cole Stanley: Mayor Cole Stanley described a forensic audit as 'a formalized audit that digs down deep without some handcuffs' and said the firm should be able to review 'everything years past.'[14]

    • ✓ Verified

      Councilmember Les Simpson: Councilmember Les Simpson said, 'To me, it doesn't matter if it costs $1 or $200,000. If it's worth doing, it's worth doing. If it's not, it's not.' This was a hypothetical range, not a cost estimate; no cost estimate for the forensic audit was reported.[14]

    • ✓ Verified

      Some council members said they had not heard or seen any issues with the funds and did not wish to spend money on an audit they considered unnecessary; supporters said it was needed to rebuild trust and ensure financial transparency.[14]

    • ✓ Verified

      No source reviewed reports an allegation by the City or its auditors of missing funds or wrongdoing. The fiscal 2022, 2024 and 2025 auditor's reports state unmodified opinions (the opinion page of the scanned fiscal 2023 report is not legible), and the City has not publicly stated that the earlier restatements or the software change led to the forensic audit; reported reasons were questions about past financial records, the $43 million CIP figure and the new CFO. The fiscal 2025 single audit's nine federal-program findings report no questioned costs.[14][11][4][5][1][12]

    • ✓ Verified

      The City's boards page describes the Council Audit Committee as two councilmembers, the City Manager, the Chief Financial Officer and a member of the AEDC, Amarillo Hospital District, Amarillo-Potter Events Venue District or Amarillo Local Government Corporation board, serving as an advisory committee to the City Council regarding financial information, financial reports and communications with the City's independent auditors. It lists the enacting authority as '04-05-16-2; rev. 12-14-21-1', five members and three-year terms.[16]

    • ✓ Verified

      The July 14, 2026 minutes list discussion items 4.1, 'Discussion of roles and responsibilities of Council Audit Committee,' and 4.2, 'Discussion of definition for potential forensic audit scope to include CIP projects, sewer and water, and American Rescue Plan Act (ARPA) monies'; each records that Mayor Stanley introduced and presented the item. No vote is recorded on either item.[15]

  11. · Related development

    City issues a forensic-audit request for quotations; staff describe software-report errors and an ACFR footnote correction

    As budget workshops began, staff said reports from the new financial software caused cash-flow figures needing correction and that staff were working with the audit firm to correct an ACFR footnote. The Tribune reported on August 13 that the City issued a request for quotations for a forensic audit on August 11, and that the ACFR shows $288 million in committed funds while the actual figure is closer to $207 million. The City's procurement portal lists it as RFQ 317-26 MRH, closing September 10, 2026.[3][17][10]

    Cole Stanley

    • ✓ Verified

      On August 11, 2026 staff said some available funds appeared as negative in the proposed budget because of the software report issue and the need to match figures in the annual audit; the City Secretary said staff were working with the audit firm to correct a footnote, after which cash flows would be updated. Staff said the issue affects projected year-end balances, not the proposed budget.[3]

    • ⚠ Sources differ

      The Amarillo Tribune reported on August 13, 2026 that the ACFR used an incorrect number based on the software-generated reports, which the independent auditing firm was correcting: the ACFR shows $288 million in committed funds, while the actual number is closer to $207 million.[17]

      Reported value 1[17]

      Committed funds
      $288,000,000

      Committed funds as shown in the FY2025 ACFR, per the Tribune.

      Reported value 2[17]

      Committed funds
      $207,000,000

      'Closer to' figure given as the actual number, per the Tribune (approximate).

    • ✓ Verified

      The Amarillo Tribune reported that the City issued a request for quotations for a forensic audit on Tuesday, August 11, 2026, and that Mayor Cole Stanley said a forensic audit could review the CIP fund commitments to verify the actual number.[17]

    • ✓ Verified

      The City's Bonfire procurement portal lists solicitation 'RFQ 317-26 MRH,' 'Forensic Audit and Related Professional Services,' among past opportunities, with a closing date of September 10, 2026. The listing does not show the number of responses or an award.[10]

  12. · Related development

    Audit committee splits the forensic audit into water/sewer and community-improvement components

    The audit committee met September 28 and decided to split the audit into the water and sewer fund and community improvement projects, possibly hiring a firm for each. Scoring of firms was not complete; the mayor said the committee would pick three firms to interview and return in October with a recommended scope and firm for each component.[18]

    Cole StanleyDavid PrescottAndrew FreemanLes Simpson

    • ✓ Verified

      Mayor Cole Stanley: Mayor Stanley said the audit committee includes himself, Councilmember David Prescott, a former assistant city manager, Acting City Manager Andrew Freeman and Chief Financial Officer Lola Ogunremi.[18]

    • ✓ Verified

      The audit committee met Monday, September 28, 2026 and decided to split the audit into two components, the water and sewer fund and community improvement projects, and is considering hiring two firms, one per component, to save time.[18]

    • ✓ Verified

      Mayor Cole Stanley: Stanley said scoring of the audit firms was not complete, that the committee would meet to review scores, highlight the top three firms and schedule interviews, and that it 'should come back in October with a recommendation for scope of work and audit firms for each one of those two items.'[18]

    • ✓ Verified

      Councilmember Les Simpson; Mayor Cole Stanley: At the September 29, 2026 council meeting, Councilmember Les Simpson said institutional knowledge needs to be verified and 'we have to be willing to challenge assumptions even when something has been done the same way for years'; he said that when the mayor began questioning the budget numbers he had defended staff. Stanley said he hoped he could rely on Simpson's and the council's support during the upcoming forensic audit.[18]

  13. Scheduled

    October 13 council agenda lists a forensic audit update

    The agenda for the City Council's October 13, 2026 regular meeting lists discussion item 4.2, "Forensic Audit Update." The agenda does not describe the update or list an action item to hire a firm.[19]

    • Pending

      The October 13, 2026 agenda lists '4.2. Forensic Audit Update' under discussion items. No consent or non-consent item on that agenda awards a forensic-audit contract.[19]

  14. Scheduled

    Audit committee expected to recommend forensic-audit scope and firms

    Mayor Stanley said the audit committee should return to the council in October 2026 with a recommended scope of work and audit firm for each of the two components.[18][19]

    Cole Stanley

    • Pending

      Mayor Cole Stanley: Stanley said, 'The audit committee should come back in October with a recommendation for scope of work and audit firms.' Whether ARPA funds will be in scope had not been reported as of October 10, 2026. The October 13, 2026 council agenda lists a 'Forensic Audit Update' discussion item.[18][19]

    • Pending

      As of October 10, 2026, no audit-committee recommendation, firm name, scope or cost for the forensic audit had been published in the council agendas or minutes on the City's CivicClerk portal; the next scheduled item is the October 13 'Forensic Audit Update.'[19]

Related storylines: Amarillo's $39.7 million in American Rescue Plan Act recovery funds (2021-2026)Amarillo's property tax rate and voter-approved debt (2016-2026)Amarillo's certificates of obligation (2017-2026)Amarillo's enterprise software transition: Tyler Munis and EnerGov to Workday and MGO (2017-2026)Amarillo's wastewater plants: failures, enforcement, expansion financing and rate increases (2022-2026)