ARLINGTON — The city of Arlington has received a clean financial audit for the 2013 fiscal year from the state auditor’s office.

The report cited the city’s focus on building its reserves and working toward full financial stability.

The city also received a clean audit report on its reporting of its employees’ retirement benefits.

The accountability audit reviewed conflict of interest compliance, cash handling, and inventory and financial controls at the Arlington airport.

The audit found no conflicts of interest, but did note a few areas that needed improvement, expressing concerns over internal controls at the airport.

Kristin Banfield, director of human resources and communications for the city, explained that the auditor addressed the appearance of a conflict of interest involving Mayor Barbara Tolbert, who serves as executive director of the Arlington Fly-In.

“The auditor did not find a conflict of interest, and reminded the city of its obligation to prevent such occurrences,” Banfield said. “The audit report discusses situations that may give an appearance of a conflict, but this is a legal standard and not a requirement of state law.”

The city stated, in its response to the auditor’s office: “Indeed, in a relatively small town like Arlington, this would be difficult to achieve.”

The audit also found there was no loss of revenue to the airport. All payments were received from the leaseholders, and the amounts represent just 0.6 percent of the total amount of revenue received from leasing activities.

“While we do not believe we have had, or are having a loss of airport revenue, we have instituted new procedures at the airport that will more quickly identify a potential issue,” city administrator Paul Ellis said.

These new procedures include the regular review of lease files to ensure they remain up to date, and that all billing is completed in a timely manner.

Banfield elaborated that staff began reviewing the airport’s 200 leases in 2013 to ensure they were all up to date.

When they discovered a number of outdated leases, they brought updated leases to the airport commission for approval.

Kristin Baylor, audit manager for the state auditor’s office, said their recommendations included establishing adequate internal controls of the airport’s financial activity and reviews of the costs allocated to restricted funds. They also called for the city to ensure controls for all city property leases prior to their use, and procedures to monitor the lease requirements of state law, city policy and municipal code.

Banfield assured citizens that the city has already taken steps to fulfill the audit recommendations.

Although the previous airport manager has since taken another job out of state, David Ryan, the airport manager who was hired in 2014 has continued the lease review and updates.

New procedures at the Arlington Police Department have also been implemented, to ensure the completion of the biennial survey required to appropriately allocate costs for public safety to the airport.

Banfield noted that the survey of police patrols and responses on and around airport property must be completed in even years.

The city has followed an agreement with the Federal Aviation Administration since its adoption in 1999, with one exception in 2012, when the survey was performed a year late.

Banfield added that the survey should have been completed and implemented for the 2013 budget, but due to staffing shortages in the police department, it was not completed until 2013. She emphasized that the airport did not lose any revenue from this issue.

“We firmly believe that the annual accountability audits by the state auditor’s office provide us with continual opportunities for improvement as stewards of the public’s money and assets,” Tolbert said. “The city recognizes the importance of maintaining adequate internal controls, and appreciate the input from the state auditor’s office to assist us in better safeguarding public assets.”