County Clerk Kim Gibbs reported to the commissioners on June 2 that the state auditors found issues with the county’s accounting system, as it didn’t reflect all the county’s cash balances, revenues and expenses. They also found problems with budgetary controls, the absence of an investment policy and a lack of internal controls over the schedule of expenditures of federal awards (SEFA).

“As certain accounts are maintained outside the system, discrepancies from the 2019 conversion remain, resulting in permanent reconciliation discrepancies between the fund balances per the accounting system and the bank balance,” Gibbs said.

To fix the problem, they plan to start budgeting appropriately for the National Opioid Settlement Fund. She added that the coroner facility renovation fund no longer exists, so it has a zero balance, and that the emergency management director (EMD) has been budgeted accordingly. Treasurer Karen Sikes is working with the software company to correct the issues.

“Some of the entries made during the transition to the software were possibly entered incorrectly, so it is going to take some time, and possibly hiring an accountant to help us figure out why she cannot get this to reconcile with the bank statements,” Gibbs said.

Additionally, in 2023 the county didn’t adopt a formal budget for the Coroner Facility Renovation and Emergency Management funds, the Criminal Costs fund in 2024 or the Law Enforcement Restitution, National Opioid Settlement and American Rescue Act funds in both 2023 and 2024.

State statutes prohibit an excess of expenditures in approved budgets, and the preparation of a formal budget for all county funds is required.

According to the audit, “funds should not be budgeted to have a negative (deficit) ending balance (appropriations exceeding the beginning balance plus anticipated revenues).

Gibbs said that the county’s response is for the commission to strive to be fiscally responsible and work within the budget.

“However, due to grant funding, reimbursements and other unexpected natural disasters, we sometimes exhaust budget funds,” Gibbs said. “We now know the process to amend the budget, so we will do a budget amendment before we end the year with a negative balance.”

A formal investment policy was developed and adopted due to the auditor’s recommendation.

It is a requirement, and compliance should be checked at least annually as required by state statute.

The last recommendation that the auditors made was that the county implement internal controls to ensure that the SEFA is complete and accurately shows spending of awarded funds each year.

In response, Gibbs created a document that lists all programs that award federal money. She said she was unaware of all the federal agencies and programs that needed to be reported on the SEFA, but with help from the auditors, she is confident she can report it correctly now.