County will miss another audit deadline

Continuing a six-year pattern, a state audit report for Whitman County’s finances will be late this year.

State auditors and county finance officials reported to commissioners Monday that clarification of errors in the 2009 financial statement would push the state’s final audit report past the Sept. 30 deadline.

Commissioners, acting on the recommendation of sole finance employee Esther Wilson, agreed to take the chance on missing the deadline in order to have the county’s contracted accountant clarify errors found by state auditors who have been checking the county’s report for the past month.

The county’s year-end audits have been submitted late for review for the past six years.

The 2009 statement was officially turned in July 26 of this year. The state’s audit began in early August. Errors found in the report were reported back to the county for clarification.

Addressing those errors will likely push back state auditors’ finished report beyond the Sept. 30 deadline.

Late statements were one of the reasons commissioners fired Finance Director Bev Divine June 1. Her assistant director, Sharron Cunningham, resigned two days later.

Under Divine, the finance department submitted a 2009 financial statement at the end of May. However, that statement was marked as a draft and could not be reviewed by auditors, according to an e-mail written commissioners by Joel Gilrein, a member of the state audit team.

The county since firing Divine hired Elias Sirianio, with the Anderson Peretti accounting firm of Spokane, to work on its annual financial statement. Through last Friday, Anderson Peretti has been paid $31,558 this year, primarily for Sirianio’s work on the statement.

Errors identified by state auditors include an imbalance between the treasurer’s investment records and bank statements, mistakes in how district court fees are recorded and faults in how the county values the depreciation of its assets.

“I don’t think we’re missing any money or anything,” said Commissioner Greg Partch. “I think we’ve just been too loose with how we’ve handled things.”

All the problems were identified as findings in the county’s audit for the 2008 books which was released June 18.

The 2008 audit found $582,000 on bank statements that were not recorded on the county’s ledger. Since then, Sirianio and county finance staff have worked to find the investments.

Wilson, who is challenging Auditor Eunice Coker this fall, reported Monday that the dollar amount has been hard to pin down. She recommended taking the amount listed on bank statements at the end of this year and writing off any discrepancy. Not doing so, she said, would be “asking for trouble.”

“We need to go forward into New World with a credible cash balance,” said Wilson.

The half-million dollar New World accounting software is expected to be brought online next year, six years after the system was purchased by the county.

Debbie Pennick, manager of the state auditor’s Pullman office, said the district court problem has apparently been resolved.

Resolving the county’s problems with its process for depreciating assets, another problem in the 2008 audit, is another story. Pennick said a specific problem was resolved, but devaluation calculations in other departments were still not done properly.

Auditors take a sampling of the county’s financial statement and extrapolate, based on that information, the accuracy of the county’s accounting.

Typical audits include a look at 25 percent of the county’s financial statement. Pennick said new federal guidelines consider counties that submit statements after a deadline high-risk.

If late, that would mean audit teams look at 50 percent of the statement for the next two years.

She added a late statement could jeopardize the county’s chances of receiving funding from the federal government.

“We’re just kind of in a new phase – a new era in how funding is looked at,” said Pennick.

Several programs throughout various county departments are funded with the help of federal dollars.

Pennick warned, though, that a statement reviewed on time but with the errors included could very well have a negative impact on the county’s bond rating.