County hits deadline for financial statements

Audit breaks long streak of overdue reports

Posted

For the first time in four years, Elbert County submitted its financial statements and compliance audit prior to the statutory deadline of midnight, July 31.

At a special meeting of the Board of County Commissioners on July 30, Kim Higgins, a partner with Eide Bailly LLP, presented her accounting firm's audit opinions regarding the county's 2013 financial statements, in addition to a report on compliance with federal awards.

Over the past years, Elbert County has had its share of financial challenges, and though the county government may not have completely turned its finances around, there was good news that came out of the audit.

During her presentation to the BOCC, Higgins praised the county's efforts to improve its financial situation and applauded the direction the county is heading to develop its reporting procedures. She noted that despite financial struggles, the county still managed to complete a significant number of projects in 2013.

“That's positive for the taxpayers,” Higgins said.

The news was not all good. Higgins cautioned that additional improvements to internal controls and administrative procedures are needed to facilitate the availability of timely financial information needed to make well-informed decisions.

The county's overall revenue rose by $350,000, primarily from charges for services and use taxes, but the primary source of revenue, property tax review, remained flat year-over-year, and the county lost more than $3 million for the second year straight year.

Though the $3 million loss comes primarily from the depreciation of capital, which is a paper loss, the number quantifies the aging of county assets that will eventually need to be replaced in the future.

In addition, audit testing revealed two systemic flaws — “material weaknesses” — in the administration of federally funded programs. The first allowed the county to overstate and then understate payroll costs to the state; the second, to pay benefits for federally funded programs without obtaining all of the necessary information outlined by the programs.

These same weaknesses were also identified in the 2012 audit, but since that audit wasn't presented until Jan. 15, 2014, five and half months past the statutory deadline, the county was not able to fix the errors prior to the end of 2013. The county has since moved to correct the issues.

Eide Bailly's reports also clarified the roles and responsibilities of each party involved in the accounting process.

“The preparation and fair presentation of these (financial statements) is the responsibility of Elbert County management,” Higgins said. “The role of the auditors is to express an opinion regarding whether the information in the reports are fairly stated in accordance with Generally Accepted Auditing Standards and Generally Accepted Government Auditing Standards.”

The county received an unqualified audit opinion, the highest available, for its financial statements, but received a qualified opinion (a lower rating) for its Report on Compliance with Major Federal Programs.