Tobar questions numbers in audit report

Grady County auditor Tom Carmichael of Carr Riggs & Ingram presented the county’s 2013 audit to county commissioners last week and some of the results are now being questioned by Grady County Administrator Carlos Tobar.
The much anticipated audit was delayed this year due to turnover in the county’s accounting department, according to Carmichael.
The auditor, on the county’s behalf, applied for and received an extension on filing the audit until Dec. 31.
Carmichael’s findings reveal that the majority of county government departments and county offices spent more than what was appropriated in their respective budgets in 2013 with the exception of general government, which spent $5,000 less than the $3,772,000 budget.
Public safety, which includes the sheriff’s office, jail and emergency medical service, spent $34,000 more than what commissioners had budgeted; the court system went over budget by $8,000; road and bridges came in at $6,000 over budget, solid waste was $2,000 over budget, and the recreation department over spent by $2,000.
The county had budgeted to spend $11,634,000 in 2013 but actual expenditures were $11,682,000 or a difference of $48,000.
When Tobar was asked this week by The Messenger about the expenditures in excess of budget, the administrator said he questioned the figures and how they were presented in Carmichael’s audit presentation.
Tobar said he attempted to make contact with the auditor Tuesday to ask questions since the total expenses by department in the county’s accounting system did not equal the total expenditures included in the audit presentation.
“According to what’s in CSI the numbers don’t match up,” Tobar said this week. “I want to talk to Tom about this,” he added.
Offsetting the increased expenditures was significantly higher revenues than budgeted, the 2013 audit shows.
According to the auditor, the county received $925,000 more in property taxes than had been budgeted in 2013.
Carmichael said the majority of the increase in tax revenue was a result of the timing of collections. According to the auditor, some of that tax revenue had been budgeted to be collected in 2012, but the money was not received until 2013.
Sales tax revenue continues to come in below expected levels. In 2013, the county collected $143,000 less in Local Option Sales Tax than it had budgeted.
The county also saw court fines and fees drop $112,000 below budget, which the auditor said relates to issues in the State Court of Grady County, where fines and fees had allegedly been collected improperly.
The county ended 2013 with a fund balance of $10,386,000, but Carmichael pointed out that it costs approximately $1 million a month to operate the county and that $10 million fund balance is required to carry the county for an entire year until more taxes are collected the following December.
“By the end of December you have collected 75 to 80 percent of all of your tax revenue. If you look at your fund balance at the end of October it would probably be at its lowest point,” Carmichael said.
As of Dec. 31, 2013 the balances in the county’s capital project funds were: Tired Creek – $7,105,000; SPLOST 2007 – $2,380,000; SPLOST 2002 – $643,000; and Prior SPLOSTs – $25,000.
“This cash is reserved for these projects or the projects approved for in the sales tax referendums,” Carmichael said.
From 2012 to 2013 the county reduced its long-term debt by approximately $1 million, from $17,055,000 to $16,047,000. This includes $14,940,000 issued to fund the construction of the Tired Creek dam. The auditor noted that principal payments of approximately $700,000 on the Tired Creek bonds become due in 2015.
Carmichael met with county commissioners last week in a workshop following the commissioners’ regular meeting to review the audit and discuss issues in the county’s accounting department.
The auditor said that in the process of compiling the audit he learned that bank statement reconciliations were not up to date.
“We met with (Grady County Administrator) Carlos (Tobar) in mid-August and shared with him some of the issues we identified including the bank statement reconciliation and cash management,” Carmichael said.
The auditor suggested that the county consolidate its bank accounts and close unnecessary accounts, which Accounting Manager Connie Blackman has been working on.
The auditor also suggested changes to the way electronic transfers and disbursements are accounted for rather than waiting until bank statements are received in the mail.
Auditors made subsequent visits in September and in October to evaluate the progress being made by Ms. Blackman and offer guidance.
“Of the 26 accounts, 18 had been reconciled through September and of the remaining six accounts Connie is continuing to work on those and she should be finished by the end of the year,” Carmichael said.
The auditor said that in preparing the 2014 audit he and his staff will be able to assist Ms. Blackman in developing monthly reports that focus on the general fund revenues and expenditures.
“For you as a board, the biggest thing you do is to put a budget in place and then it is a matter of monitoring it. The reports I’m referring to can be generated directly out of your accounting system and can be provided to you on a monthly basis,” Carmichael said.
The board also discussed with the auditor a “weakness” found in compiling the audit related to the Grady County Hospital Authority.
County Commissioner Charles Norton asked if the auditor would make a presentation to the hospital authority about the findings that were recorded in the audit.
“It is a small operation and we just summarize the bank statements when in actuality the authority should summarize their statements and provide to us. It is a weakness we have to communicate,” Carmichael said.
The auditor offered to write a letter to the authority making them aware of the situation.