Jacob Dimond / jake@yelmonline.com
During a Roy City Council meeting on Monday, Sept. 8, an audit team, consisting of Courtney
Amonsen, Kirk Gadbois and Kristina Baylor, presented its findings from fiscal years 2021, 2022, and 2023 to those attending the meeting.
Amonsen first highlighted why having an audit conducted at the city level is important and told council how the process occurs. With the findings, Amonsen believes there’s a lot of benefits to conducting audits.
“There’s a lot of benefits in having an audit conducted. It provides that increase in trust in your government by being an independent organization. As an independent agency, the auditor’s office has the opportunity to take a look at all the use of funds and do an examination to provide that transparency on where things are at,” Amonsen said. “What you were aware of, and what you’ll see in the report, is within the city, there is a declining financial condition. As the mayor and city council, it’s your shared responsibility to jointly work together to provide that adequate financial oversight to help guide your city through that. Our goals tonight are to share those results to you, let you know what we identified, and then answer any questions you might have.”
Gadbois, the audit supervisor, followed Amonsen’s introduction and presented an accountability report. He described this as the audit team coming in and looking at the city’s compliance with state laws, policies, procedures and how well it’s safeguarding public resources and assets.
“What we did is we started off with a three-year audit, covering fiscal years ‘21, ‘22, and ‘23. That was our original audit approach,” he said. “During the course of our audit, we did expand to cover fiscal year 24’ as well. This report will cover all four years and get you caught up to the current date.”
According to Gadbois, the audit team found that within most areas, the City of Roy was compliant with state laws. He also identified some areas where Roy could make improvements, but noted the audit team wasn’t able to look at everything as it would’ve required year-round efforts. He noted the audit team did, however, listen to the public’s concerns, read reports from different news outlets, and look at different meeting minutes.
“We do have some recommendations for you,” Gadbois said. “The areas we picked were your accounts payable system — all the different ways the city spends money, whether it’s credit cards, general disbursement process, electronic funds transfers if any, and the city’s review of bank statements. That’s really important. How is money going to help the city?”
According to Gadbois, another big area of focus was Roy’s payroll system. He noted he’d heard concerns about the city’s payroll system through conversations with City of Roy representatives.
“Other areas we looked at were conflicts of interest. With Roy, it’s probably a smaller town here and there’s a good chance that some of you know somebody or are related to somebody, where potentially there could be a conflict of interest with a contractor,” Gadbois said. “I wanted to make sure how well the city is monitoring that.”
He added that the City of Roy should be aware of any potential conflicts of interest in contracts before moving forward with any projects. Additionally, Gadbois said the audit team looked at financial conditions, which was a common area of issue around the state with all sizes of government.
“Big budget problems. Federal money is going away, and a lot of governments from around our state — including the state itself, down to bigger cities and most school districts I’m aware of, to small cities like Roy. That’s definitely an area we wanted to look at,” Gadbois said. “Another big area we look at for all governments across the state is the compliance with the Open Public Meetings Act. We review your minutes and look through those things. We would want to tell you if there’s ways to improve meeting minute documentation, or if we saw non-compliance with that.”
Gadbois also highlighted some of the findings from the audit report, including the financial operations of Roy, its financial reporting, and how it led to the current financial condition of the city.
“One of the things we noticed when we were doing our audit is when we were looking at and asking for the different financial reports of the city — to look at financial condition and see how well council, mayor and management were reviewing operations — we were finding that, because of significant turnover here in the city with the clerk treasurer condition, a lot of bank reconciliations were not done timely,” Gadbois said. “The financial reports that were being provided to us, staff were acknowledging that these aren’t very accurate and can’t be relied upon. Obviously that’s concerning … The other big thing we noticed is that the fund balance for the city has been decreasing year over year. Council has been approving budgets where expenditures are exceeding revenues over the last couple of years. It’s an area we wanted to bring to your attention as well. We know you’re very aware of it. We watch your meetings. We watched your discussions. We know this is an area you’re well aware of and working to correct.”
According to Gadbois, those were the biggest sections of findings from within the audit report. He did note that communication was a big theme and source of frustration that he’s heard from city staff. He said a lack of communication has potentially injured business within the City of Roy.
“We did have another recommendation … it’s a management letter and it’s referenced in the audit report. It’s related to the payroll stuff we looked at. It’s not included word for word in our published report,” he said. “Our review of payroll focused on two former employees and essentially how they were paid while they were here. I want to mention we did not notice any fraud or misappropriation, or anything like that. However, we did notice some non-compliance with city policies. City policy does allow for payout of leave, vacation leave, at separation of employment. We noticed there were two instances where employees received payout for their vacation leave prior to leaving employment with the city. A couple months later, they got additional payouts of leave when they actually separated employment from the city. That’s something we wanted to bring to your attention. That could be allowed if council wants that, but it would be a policy change. We recommend to follow your written policies and procedures, not allowing that. The biggest thing here is learning experiences and following your policies and procedures and setting those clear expectations of here’s what we expect these employees to do, here’s how we’re classifying them, and this is how we expect to pay that employee before they start working for the city or working for you.”
