Drescher & Malecki Partner Carl Widmer presents 2022 audit to Jamestown City Council (February 26, 2024)
Fund balance numbers continue to be positive in the City of Jamestown‘s 2022 audit.
Drescher & Malecki Partner Carl Widmer presented the results of the audit to Jamestown City Council Monday night. The report, which normally is presented several months after the close of the previous fiscal year, was delayed in part due to the lack of a full-time City Comptroller in City Government from December 2022 until January 1, 2024.
Widmer said the city’s revenues for 2022 were $45 million with expenditures at $43.8 million.
He said when it comes to the city’s total fund balance, the unassigned balance was $7.6 million with the assigned balance of $1.1 million. Widmer said the unassigned balance currently represents 17.5% of the year’s spending and is within the Government Finance Officer’s Association (GFOA) recommendation that a municipality’s general fund should have at least two months of spending in their unassigned balance.
Due to the city spending more than $750,000 in federal funds in a fiscal year, Widmer said a single audit is required in addition to the regular audit. He said this is due to the spending of American Rescue Plan funds, “And we find what programs went through the city, select certain programs, and then perform strictly a compliance audit under federal standards. So, for this past year, the fiscal year 2022, total federal awards were over $6 million, and they were primarily spent with your ARPA money, which was over $4 million, and your Community Development Block Grant program which was just shy of $1.5 million.”
Widmer said there was a compliance issue found in how ARPA funds were handled, “With every federal program, ARPA has specific reporting requirements where they want they want a bunch of information about what are you spending this money on uploaded to their portal. We take a look at that information just to make sure that it’s happening. What we found was that several of the projects were misclassified or miscategorized, so we had to report a compliance finding on that.”
Widmer said he’s spoken with Mayor Kim Ecklund and Comptroller Ericka Thomas on a corrective action plan and that the issue should be alleviated by next year’s audit.
Due to the delay in the audit and the personnel changes in the Finance Department, he said the recommendations made in 2021 about internal controls for the finance department and segregation of duties still stand, “Something that we talked about where you don’t want any one person in charge of certain financial transactions from start to finish. In other words, you want to incorporate other people as checks and balances and also as deterrent to fraud. So, with the rotation and everything in the Comptroller’s office in handling the general ledger, there were inconsistencies there. So, those improvements that were planned; they weren’t made.”
Ecklund said those concerns are being discussed, including how to proceed with the currently vacant Deputy Comptroller position, a position that Drescher & Malecki had previously said would help with the segregation of duties issue.
At their voting session Monday night, City Council approved a new agreement with Drescher & Malecki to handle the city’s independent audit for 2023 through 2025 at a total cost of $105,495.
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