In the Mayor’s Report to the Yelm City Council tonight, Mr. Harding explained that the State Auditor recommended additional procedures for financial oversight and in following the manual in how this is executed. Harding said this involves additional training and adding a layer of oversight.
He presented the Auditor’s Office report as a minor procedural finding, yet when looking at the results of the audit, such is far from the case. The Auditor’s Report stated Yelm had a “significant deficiency” in the city’s lack of oversight in financial reports.
This is extremely troubling because Mr. Harding served as Thurston County Deputy Auditor for almost a year beginning in early 2013.
The city has a state audit every 2 years and in the 2012 report issued February 19, 2013, the city was about “internal control over financial reporting.” This city’s lack of internal controls on financial matters in two State Audit findings is disconcerting, especially with Mr. Harding at the leadership helm at the same time he served as County Auditor, for a period of time this 2014 audit covers.
From the WA. State Auditor’s report:
Description of Condition
During our audit, we identified the following deficiencies in internal controls over financial reporting that, when taken together, represent a significant deficiency:
The City does not have procedures in place, including close supervision and
oversight, to ensure information entered into the general ledger is accurate.
City staff responsible for compiling the financial statements did not always effectively use the Budget Accounting and Reporting System (BARS) Manual when preparing the financial statements.
The City lacks an effective review process to ensure amounts reported on the financial statements agree to supporting records and are prepared in accordance with the Budgeting, Accounting and Reporting Systems (BARS) Manual.
Cause of Condition
The City has not made it a priority to obtain the necessary resources or processes, such as training and oversight, to prepare accurate accounting records and financial statements.
– Editor’s note:
Interesting that one of the issues was with the $2.3 Library bond, where the city council added $1m for a Community Center to the $1m Library bond without public input, covered in a Letter to the Editor this week.
– UPDATE: November 13, 2014
“Yelm Dinged for Financial Reporting”