Payson this year cleared its state-mandated annual audit with flying colors.
“We didn’t find any significant issues at all this year,” said Dennis Osuch, with Larson Allen CPAs, Consultants and Advisors.
The town’s financial accounting system has corrected the problems revealed two years ago when Town Manager Debra Galbraith discovered nearly $1 million stashed away in “restricted” accounts that weren’t really restricted.
Moreover, the town staff has instituted monthly and quarterly reports to the town council that have eliminated the lack of oversight that four years ago prompted the councilors to approve budget changes that consumed the reserve fund before they even knew they’d done it.
On this audit, the outside experts found few problems.
Osuch said the audit revealed just two “material weaknesses,” which mostly had to do with the software used to track spending out of the cash account.
The audit also made some minor adjustments in the bookkeeping system used to keep track of a $10.5 million federal stimulus grant the town received to build the Blue Ridge pipeline.
Payson Mayor Kenny Evans said the federal government has also audited its handling of that money three times. “Maybe they just like coming to Payson,” he quipped.
Osuch said the town has made big improvements in its financial accounting systems. “This was a vast improvement over what we’ve had in the past,“ Debra (Galbraith) and (Finance Director) Hope Cribb did a great job throughout the year.”
Osuch said the town has changed the way it categorizes various funds. The town finances most of its operations through its roughly $12 million general fund, but also moves money through a bewilderment of special funds like the water fund and various improvement districts established so homeowners can finance things like streets, sewers, lighting and water expansions.
Many of those funds have legal restrictions on what the town can use the money for, often due to bonding and grant restrictions. But the council had gotten into the habit of also setting up special funds for certain purposes, even though the restrictions were decided on by the council instead of state law or commitments to bond holders.
Now, the town will make it clear that such special funds aren’t actually restricted, so the council and auditors alike realize the council can move money freely in and out of those accounts.
“We’ve changed the definition of ‘restricted’ funds,” said Evans. “It has to be restricted by some outside party, not our own restrictions.”