State auditor again issues “finding” on county finances

For the third year in a row, the State Auditor’s Office issued a “finding” criticizing the way Grays Harbor County handles its finances.

In an exit conference with the Grays Harbor County commissioners on Wednesday, officials with the State Auditor’s Office said the county’ s financial statements for calendar year 2011 lack the details needed for their office to “ensure accurate and complete financial reporting.”

The state auditors noted that at one point the county thought it had two federal grants to audit, when, in fact, there was just one grant. Further, the auditors said there was misclassification of funds balances. There are no allegations of missing money, just errors in the way the paperwork is being filed.

Audit Manager Angie Cady said the county is working to fix the problem, and noted that the county’s main response to the issue is that the county’s financing arm is short-staffed and turnover had been an issue last year.

The main issue is new standards for doing financial reporting put in place by the Governmental Accounting Standards Board, a national organization that sets up best practices for financing reporting. The standards were to be in place by June of 2010.

Grays Harbor County Auditor Vern Spatz attended the exit conference and noted that some county staff members hadn’t been trained in the new standards until many months after the rules were to take effect.

The finding issued was part of the annual financial audit done to see if the county is meeting grant criteria and keeping proper records. Cady said her office will begin an accountability audit at the end of the month. An exit conference for that audit could happen in November, she said.

Last year, after completing the accountability audit, the State Auditor’s Office issued a “finding” focusing on the way the county commissioners have routinely done budgets, saying they need to do a better job of building reserves and stop relying on interfund loans. That issue will be reviewed during the separate audit.

In 2010, the county received a finding for its monitoring of a federal block grant. Those issues were fixed last year, according to the State Auditor’s Office.