(The Center Square) — The financial statements for the town of Ferriday had several accounting issues and material weaknesses in their latest audit.
The Louisiana Legislative Auditor’s Office hired the accounting firm KnightMasden to perform the audit for the town’s financial statements for the year ending June 30, 2022. They found 11 errors in their research.
It started on a bad note with the town not even able to supply the auditor documentation related to franchise tax receivables, contracts for services, grant agreements, fixed asset purchases including bid process, invoices or similar documentation on expenditures, retirement plan submissions, rental income, accounts payable, pledged assets or grant tracking.
Second, Ferriday had an unfavorable expenditure variance of $412,950 or 14.5% for the year. If this happens, the Budget Act requires that budgets be amended when the variance exceeds 5%. They did not amend it properly.
The town violated the budget act again because they did not adopt the budget on time, which is the beginning of the fiscal year. Instead, they waited until Jan., 2022.
Fourth, the town did not publish open meeting minutes quick enough, which is against the open meetings law.
Their violations continued when auditors noted that starting Jan. 1, 2017, the town should have remitted $12.00 per service connection annually to the state. Prior to that date the fee was $2.88 per service connection annually.
However, the town was not aware of the fees or the need for them to be remitted. As a result they were not in compliance with the Safe Drinking Water Program.
Ferriday also failed to remit funds to various judicial and law enforcement agencies based on the charges/tickets collected. In fact, the town stopped remitting ticket sharing fees on collections after September 2021.
Seventh, the town did not file their financial statements to the auditors quick enough, which is six months after the fiscal year, continuing a trend of falling behind.
Every town is required to hold funds for utility deposits from customers in a separate account. However, Ferriday deposited money collected from customers for utility deposits into the incorrect bank account. Now, the town does not have enough money set aside to cover all customer utility deposits.
Next, the town could not supply documentation on grants received and tracking of expenditures and grant restrictions. As a result, they could not say what each grant received was for. Therefore, they could not provide any documentation on whether restrictions were met.
Ferriday violated yet another law with their tenth error, this time the public bid law.
The town could not supply documentation related to the purchasing of several assets during the fiscal year. This includes three pieces of equipment that should have followed the public bid law procedures.
Lastly, the town once again did not deposit correctly. Because they did not move $441 into a contingency account monthly, the correct amount of funds were not in the required bank accounts to meet bond requirements.
