State auditor finds Grand Coulee problems not fixed

An audit report made public last week is highly critical of the city of Grand Coulee’s books and states that prior “findings” still had not been corrected.

State auditors issued a number of findings, the harshest assessment that auditors note, as they published a report July 27 for the two-year period from Jan. 1, 2014, through Dec. 31, 2015.

“Our two prior audits reported that the City of Grand Coulee did not have adequate controls over financial operations,” the auditor stated. “Our current audit found the City has not addressed many of the conditions, and found additional concerns.”

A summary of the audit report stated:

The clerk/treasurer did not complete all monthly bank statements and revenue/expenditure reconciliations and entries or complete the reports for submission of the annual report.

City Council did not receive adequate financial reports to understand its financial condition or make financial decisions.

The City had neither monitored individual fund balances nor tracked restricted fund balances for the last three years.

City management did not take appropriate action to ensure the city’s financial statements were prepared.

This, the report stated, was caused because prior to 2014 the city had used an outside contractor to prepare the annual report, but starting in 2014 the outside contractor was not available, “and the clerk/treasurer was not able to prepare the annual report for 2013, 2014, and 2015.”

The auditor statement noted that “we are unable to express an opinion on the city’s financial statements for the 2014, 2015 fiscal years. And we were unable to examine individual fund balances or classifications, and could not determine whether funds were operating with a negative fund balance, or whether restricted funds were used inappropriately. Further, without accurate and complete financial records, the City is unable to effectively monitor its financial condition or make financial decisions, and we were unable to evaluate the City’s financial condition.”

Accordingly, the report stated, “the City has contracted with an outside source to assist the clerk with reconciliation of 2014, 2015. The City has begun the process to ensure the applicable laws and regulations are followed and reporting is done.”

The auditor also reported that the city had revised its personnel policy in regard to overtime, compensatory time, longevity pay and termination buyouts, without approval of the city council, and that the city adopted a travel policy change that contradicted provisions in its existing policy.

In the prior audit, the city could not identify the cases related to about $21,000 in Municipal Court revenues. As of 2015’s year end, the city still has not identified these cases and continues to hold the money.

Several other findings and recommendations were listed in the auditor’s report.

The city has responded and, as of 2016, accounts are being balanced on a monthly basis. As of March 2017, the city council is now receiving quarterly reports.

“We have had ongoing problems and have not been able to get the technical distribution of funds set up the way the state requires,” Mayor Paul Townsend said Monday. “The city is absolutely committed to get everything done that is required by year’s end. The money’s there; we just need to designate it the way the state requires.”