Dewey Beach commissioners voted unanimously Oct. 12 to accept the town’s audited financial report for the 2019 fiscal year and directed the town manager to develop a timeline to address auditor findings.
The town audit committee met Oct. 10 with auditor CohnReznick representative Dan Kenney to review town management responses to audit findings first presented Sept. 18.
Audit committee Chair Julie Johnson said last year’s dispute about whether management edited the content of the audit prompted the committee to request draft financials be presented to the committee and town management simultaneously in an initial meeting, with management responses to be added and reviewed at a second meeting.
“I wanted this committee to have a fresh start and to be clear of any perception of wrongdoing,” Johnson said. “But getting a draft report without any comments from management is kind of a clumsy way of doing it,” she said.
Audit committee member Bill Stevens said he has performed over 100 audits in his career and that drafts are always given to management to review to make sure notes are accurate and clear.
“It is imperative for the town and audit committee to review the draft ahead of time,” Stevens said. “Auditors are not going to change their audit.”
Members agreed that, going forward, town management and the audit committee will receive draft financials at the same time so management can prepare responses before a final draft is reviewed and approved at one meeting.
Town Manager Scott Koenig said the preliminary draft would be considered a public document. The document doesn’t have to be posted online, he said, but the public can request it through the Freedom of Information Act.
Johnson said the committee would meet again to work with Koenig to prioritize responses to audit findings. “We are going to have more of an active role to make sure recommendations are implemented going forward,” Johnson said.
Koenig said the town has already addressed some findings. A master vendor list and electronic payments have been set up to avoid late payments; public safety payroll now requires signatures of the police chief, lieutenant and town manager; and vacation and sick leave accruals will be reviewed quarterly.
Other recommendations include developing formal written policies and procedures, conducting an information technology risk assessment and cybersecurity assessment, evaluating a universal payroll time-tracking system, inventorying nonfinancial assets, evaluating having an outside vendor manage whistleblower complaints, and hiring a part-time financial director.