WINNSBORO – Incorrectly maintained ledgers requiring nearly $96 million in adjustments more than tripled the amount of time originally projected to complete the county’s annual audit, now six months late.
The bulk of that $96 million consisted of Dominion settlement funds, unreconciled transactions, and assorted banking records.
For future audits, auditors recommended additional training for finance staff and preparing monthly finance reports for council members, something that constituent Randy Bright and others have long called for at council meetings.
Those were the key findings of the county’s 2022 audit, which was presented Tuesday by Grant Davis, a partner in Mauldin & Jenkins of Columbia. The document must still be formally submitted to the S.C. Treasurer’s Office.
At press time, the county administrator had not posted the audit document on the county’s website for the public to see.
Davis said his firm budgeted 350 hours to complete the audit, but it took 1,200 hours to complete.
“That’s about 3 ½ times more than what it should have,” Davis said. “At the end of the day, the county’s audit shouldn’t take a significant amount of time. Fairfield County is just not an enormous county with crazy financial transactions.”
Interim County Administrator Laura Johnson said in working with the auditing firm, county staff kept unearthing various bank accounts, unreconciled transactions and missing documents, which caused a bulk of the delays.
“As a team we needed to go in and find all these transactions,” Johnson, who had not sought outside help with the task, said. “Every time we thought we were nearly done, [we] found a new document and had to post it. We just found a lot of transactions, we can’t tell you why they were never reported or reconciled.”
Council members thanked Davis and county staff for completing the audit, but noted further training of county staff is needed to expedite future audits.
“I would encourage our employees to take every available training that is offered so that we don’t end up in this situation again,” said Council Chairman Doug Pauley.
This is the second consecutive year Fairfield has been tardy in delivering its audit, which must be submitted by January 1. The 2021 audit also was several months late.
In 2022, the state withheld about $1.5 million in funding until the 2021 audit was submitted. About $5 million was withheld this year due to the late 2022 audit, though the state eventually released the funds in April to limit the financial hardship on the county government.
Fairfield’s 2022 audit said training and cross-training of county staff is vital in minimizing potential delays in preparing future audits. Davis said training mitigates impacts of lost time when there’s employee turnover.
“Coming out of [the coronavirus pandemic], a lot of finance people across the state left for whatever reason,” Davis said.
Councilwoman Shirley Greene asked what sort of training Fairfield staff has received.
“A lot of it is going back to training, taking a look at who’s responsible,” Greene said. “Who’s basically helping in those training efforts?”
Johnson said staff has attended finance training conferences and received in-house training as well.
“They’ve learned to drill down and find errors on their own,” said Johnson, who was the county’s finance director until about three years ago.
Johnson also pushed back against critics who’ve suggested out-of-date software also hampered audit preparations.
“I know comments are made that maybe our software needs to be looked at. It’s an excellent system,” she said. “If you put wrong information in what are you going to get? Wrong information. It’s about the user and what information is put in. There are several types of reports that can be wrong.”
The audit also found that the county’s fund balance has been slowly dropping as expenses rise, though Davis didn’t think it was an immediate concern.
Davis said the county still maintains six months’ worth of expenses in its fund balance. Most of those funds, however, restricted funds to be used for lease payments on the administration building.
However, the unassigned portion – the portion more readily accessible to the county to help make ends meet– stands at about $6.8 million and would cover about 2 ½ months of expenses.
“That’s a little bit lean,” he said.
Davis said three to six months is preferred.