This is the third and last year, by law, that the independent auditing firm, Pattillo, Brown & Hill, audited the City. They also helped prepare the City’s financial statement, which is not ideal, but the City is incapable of preparing it using accrual accounting, typical of small towns.
The City had five audit findings, none of which were serious, but the auditing firm didn’t look at much. Audits are similar to tasting one bite of salad, one bite of beans almondine and one bite of turkey breast in judging a Thanksgiving feast.
The auditing firm looked at cash handling, sampling the city golf course’s cash deposits. Deposits were not being made within 24 hours as required by law, which was written up as a finding.
The City took over management of the golf course from a private subcontractor in January 2019, according to the audit. It purchased a cash register and now turns in the register tapes to the finance office, which has helped.
The auditing firm looked at payroll.
It first checked if 25 employees had “personnel action forms” on file, tracking their hourly rate. Two out of the 25 didn’t have one on file.
Then the firm checked for federal form 1-9 and one out of 25 employees didn’t have one on file.
Not having these forms on file could lead to over- or under-payment of “unauthorized rates and the City is not in compliance with federal regulations,” the auditor said.
The worst finding in the payroll category was a $72,690 interest charge the City had to pay the Internal Revenue Service because it didn’t pay federal withholdings in a timely manner, such as social security, Medicare and withheld income taxes.
The third category the auditing firm looked at was retirement records.
Five out of 26 pay periods had incorrectly reported wages, creating an underpayment of $126 and throwing off employees’ retirement funds as well as the City’s retirement liability.
In one out of 26 pay periods, the City used the wrong pay-rate for one employee, creating an underpayment of $399 to the employee, again throwing off the employee’s retirement fund and the City’s liability.
In 3 out of 26 pay periods, the City used the “incorrect contribution calculation,” creating a $228 underpayment in the Public Employees Retirement Act account.
The City explained it has had turnover in the payroll department.