Here is the latest from Election year Blogger and “Fiscal Watchdog” City Councilor Rodney Elliot on his Campaign/Blog
Cash Reconciliation: Where’s the ‘Beef’? Friday, October 14, 2011
The topic of the lack of reconciliation of the Treasurer’s cash book has been either overtly downplayed or simply not addressed on the local blogs – wonder why. The Newspaper has done a good job of defining the problem. I felt that I would provide the opportunity for people to comment on it here. (GN Note: SHOCKER – NO ONE HAS!)
Background: The Treasurer’s cash book has not been properly reconciled possibly going back to 1999. The Cash book is reconciled to both the balances in the City’s bank accounts and the general ledger. All three should agree each month. If there is a variance it is the job of the Treasurer, with the assistance of the Auditor, to determine what the variance is and resolve it.
There may be any number of transactions that could make up the variance such as: cashed checks that haven’t been “cleared” from the books, deposits that may have been posted wrong, or any number of other possibilities. You really don’t know for certain what the components of the variance are until you drill down to the actual transactions the old fashioned way and get to the bottom of it. It’s a time consuming and labor intensive project. But it’s critical to understanding and analyzing our overall financial picture.
When this issue was brought to the attention of the City Council we supported the Manager’s argument that resources needed to be directed into the Treasurer’s office to correct the problem. We were told by the Manager that the problem would be the focus of the newly hired Treasurer (Memo- Dated April 2010).
We received the Management letter prepared by our outside Audit Firm from the Manager on September 27, 2011 (16 months late). The letter itself dated is dated June 30, 2010. The letter covers activity for fiscal year 2010 (July 1, 2009-June 30, 2010). Upon reading the Management letter I was disheartened to learn that the problem had yet to be resolved and still a ‘material weakness’ on internal controls. The other concern that I had was why we were receiving it so late.
There is history of City Manager’s not keeping the Council apprised of important financial information that can be traced back several decades (and one time it took a Special Act to bail the City out). So I’d have to say I’m somewhat sensitive on that subject. . If my memory serves me right, a recent incident of this nature several years ago seemed to spur intense debate on line. The silence has been deafening and confusing.
I feel that transparency in government is critical. We need information shared with us. We can’t access this information on our own. We rely heavily on the Manager to keep us informed and when he does not, it is the Auditor’s responsibility to do so – and she did not. The Council, the Auditor and the Administration need to work as one cohesive unit. That cannot occur if one of the three is left feeling around in the dark for the light switch.
Why wasn’t this task completed sooner? If we can hire an outside audit firm (Melanson & Heath) and they can close the gap in 30 days why did it take so long to do it in the first place?
That question has yet to be answered.