County Treasurer Documents Difficulties That Led to Delay of 2005 Audit

To the editor:

The auditing firm of Crowe Chizek had been engaged to perform the 2004 and 2005 audits for Logan County. The 2004 audit, including all single audits, was completed on Good Friday afternoon of 2005. The fixed assets, which were entered in the new Great Plains system, were not finished till early July, but this was a new GASB rule and because we had gotten an extension we were fine.

It was not until Crowe Chizek returned in early 2006 that issues with the software and auditing began to surface. These continued until 2007. Many attempts were made to by Logan County and Tectura, the company that had done the conversion, but we were never able to resolve the problems to Crowe Chizek's satisfaction. Tectura on different occasions came to Logan County. There were many conference calls, at our expense, as were the trips by Crowe Chizek and Tectura.

We asked for proposals for the 2006, 2007 and 2008 audit. Clifton Gunderson was selected. In order to facilitate their audits, they offered to help with the research to finish the 2005 audit. Crowe Chizek accepted. Clifton Gunderson began their assistance. The audit was finally completed and filed in October of 2007. Clifton Gunderson began to work immediately on the 2006 audit. We expect the 2006 audit to be presented to the county board in April. Clifton Gunderson expects to begin the preliminary work on the 2007 budget at the end of March 2008 or early April 2008.

The causes for the delay in the completion of the 2005 audit for Logan County included the following:

• Fund Balance: The system did not produce the fund balance information in an acceptable form for Crowe Chizek.

• Due to/Due from: Most of the time this worked fine, but there some entries that were never cleared out. Tectura had entered the 2004 accounts manually into the systems. Apparently the system would not recognize manual entries and so they remained. We explained this to Crowe Chizek, but they felt they could be corrected by the software people. The other problem in this area is that this software insists on using one cash account. We and most counties have multiple bank accounts. Because entries were made into the cash account that were not part of the actual bank account, these amounts would never be cleared out of the Due to/Due from and were accumulated. We asked Tectura to set up additional banks; this never happened. I had attempted to; however, I was unable to finish. I asked for help but nothing was ever done. Had it been done, a lot of this issue could have been resolved.

Issues stemming from conversion problems: One was a series of checks were written in December of 2004. The checks were entered into the expense module; they never made it to the banking module. When Emma reconciled that month, these checks cleared the bank, but we had nothing in our banking module. This skewed the bank balance and we asked that it be corrected, but it was not until in 2007. We do not feel the system could be corrected, because the correction that was made put these same checks back on our outstanding check list when that had cleared the bank in January of 2005. We continue to deal with them. This was one of many similar issues. We have backup material on all our problems and we welcome questions.

I want to take this opportunity to thank my staff. I simply could not have gotten through this if it were not for them. They always stopped what they were doing if we had to research and prove what we had done was correct. This happened countless times. My staff was invaluable.

The treasurer's office has never had any problems with completing their audits on time until 2005. The 2006 and 2007 delays were caused by the 2005 audit.

I have worked in the treasurer's office since 1976 and have been treasurer since 1994. We are confident with our new software, Kintera (American FundWare), we will not have any auditing problems again. The county will be saving over $50,000 a year in software costs and $35,000 in administrative costs. We have an opportunity to recover if we are careful to watch any unbudgeted spending.

We welcome the opportunity visit with anyone wishing to know more about this issue. We have an abundance of reports and paperwork to verify our statements.

Mary Bruns
Logan County treasurer

[Posted March 18, 2008]

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