OREANDA-NEWS. S&P Global Ratings lowered its long-term and underlying ratings (SPUR) on Alice, Texas' general obligation (GO) debt outstanding to 'A' from 'A+'. The outlook is stable.

The rating action reflects our view of recent developments regarding the city's fiscal 2015 audited financial statements. Subsequent to our report published Sept. 7, 2016, the city's 2015 audit was materially restated as a result of the lack of adjustments to year-end sales tax accruals. The effect of the restatement was a downward revision to both revenue and subsequent year-end fund balances, and we believe that this materially affected the city's financial profile.

"The stable outlook reflects our opinion that the new management team has implemented adequate changes that will begin to stabilize the city's budgetary performance, including expenditure cuts and a tax rate increase," said S&P Global Ratings credit analyst Joshua Travis.