January 4, 1999
CARNATION--A series of errors state auditors found in the city's finances for the year 1997 can be blamed on the lack of a full-time financial director for that year, according to Mayor David Hunter. All the faults listed by the auditor have been addressed and will be corrected, he added.
According to the auditor's report for 1997, the city's financial statements contained "numerous errors related to basic general ledger accounting." The report also noted that the financial statements for 1997 were not completed until Aug. 4, 1998.
The report listed warrants (bills for city services or supplies) posted in incorrect amounts and with incorrect dates; receipts and warrants not posted to revenue and expenditure accounts in a timely manner; ending cash and investment balances as reported in the financial statements did not agree to actual amounts held by the city; warrants outstanding at year's end did not agree to amounts held in the city's warrant clearing funds; treasurer's receipts were not always issued in numeric sequence; and the City Council failed to approve for payment warrants issued between October 1997 and December 31, 1997 until April, 1998.
The report did note that the city experienced significant turnover in its finance department staff. "The finance director resigned in June of 1997, and the city did not hire a full-time replacement until March 1998," the report states.
Current finance director Richard Gould was hired on a temporary basis at that time, and permanently in May, said Hunter.
Gould has responded to the report in writing to the auditor's office. "We are now posting to the general ledger accurately and in a timely manner," the answer reads, in part. "The general ledger is balanced to ensure that all of the necessary entries have been made and properly posted. Transaction documentation that supports the general ledger account balances is being kept in appropriate files."
The auditor's report also found that the minutes of City Council meetings were inadequate, specifically for meetings held in July and November of 1997. The City Adminstator is responsible for making sure minutes are prepared. Randy Suko was City Administrator at the time.
"Organization was often lacking," Hunter said. "And the finance director was only part-time and had some health problems. Randy was trying, but Stein (former mayor) wouldn't give him a chance (to hire a qualified person at a competitive salary)."
Hunter said retirement payments for the city's police officers that were behind three to four months were eventually made.
"There are some things in the financial statements from early 1998 that Richard (Gould) will have to go back and reconcile," Hunter said. "I have confidence in his ability."