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I CAME 33 LAST NIGHT.UM, I'LL CALL THIS MEETING OF THE UCHIN COUNTY AUDIT FINANCE COMMITTEE TO ORDER.
UM, WE HAVE A PACKET FOR ANYONE WHO WOULD, UH, LIKE IT.
IT IS JUST THE BRIEF AGENDA PLUS, UH, MINUTES FROM OUR LAST MEETING.
I WILL MOVE THE APPROVAL OF MINUTES FORWARD.
UM, DO, DOES ANYONE HAVE ANY QUESTIONS, COMMENTS ON THE AUGUST 6TH, 2025 MEETING, UH, MINUTES.
DO I HAVE A MOTION FOR THE ACCEPTANCE OF THOSE MINUTES? I MOVE TO APPROVE THE MINUTES.
UH, WE WILL NOW MOVE INTO THE FOCUS OF OUR MEETING, THE PRESENTATION OF THE 2025 FISCAL YEAR 2025 AUDIT REPORT FROM PV MAYORS.
UH, WE HAVE ANDREA NICHOLS AND MIKE FROM, UH, PV MAYORS HERE.
I WILL TURN IT OVER TO YOU ALL.
YOU'VE ALREADY CUT ME OFF MY INTRODUCTIONS, SO THAT WORKS.
WE'RE GLAD TO BE HERE, UM, AS WE ALWAYS ARE.
AND DECEMBER, TO MEET WITH THIS GROUP AND GO OVER, UM, THE RESULTS OF THE AUDIT AND YOUR FINANCIAL STATEMENTS.
AND SO WITH THAT, I'M GONNA JUMP INTO THE PRESENTATION THAT WORKED.
NORMALLY I WOULD HAVE A HANDOUT OR SO, BUT WE'RE TRYING TO SAVE THE WORLD A LITTLE BIT.
CUT BACK ON PAPER AND, AND, UH, THINK WE CAN ALL FOCUS ON THE SCREEN.
AND AT ANY TIME, IF YOU HAVE QUESTIONS, PLEASE JUST, UH, JUST, JUST ASK.
SO WHEN, AS YOU HAVE, HAVE IN FRONT OF YOU, UM, IS THE ER, THE ANNUAL COMPREHENSIVE FINANCIAL REPORT OF LESS KNOWN AS THE ER, A LOT EASIER TO PRONOUNCE? I THINK, UM, JUST FOR THOSE WHO DON'T, THERE'S A BOX YES.
WITH THEM IN THE CORNER, SO PLEASE FEEL FREE TO GRAB THEM.
UM, SO WE WILL BE ISSUING OR HAVE ISSUED AN UNMODIFIED OPINION ON YOUR FINANCIAL STATEMENTS.
THAT'S THE ONE YOU'RE LOOKING FOR.
UM, AND SO WE'RE, WE'RE HAPPY TO HAVE BEEN ABLE TO DO THAT.
UM, WE DID HAVE THIS YEAR SOME MATERIAL WEAKNESSES, UM, THAT WERE REPORTED TO YOU IN THE VERY BACK OF THIS DOCUMENT IN THE COMPLIANCE SECTION.
UM, THERE IS A MATERIAL WEAKNESS BACK THERE.
MOST OF THAT HAD TO DO WITH JUST BEING PREPARED, UM, FOR THE AUDIT WHEN WE GOT HERE, AND ONCE WE DUG INTO SOME OF THE NUMBERS AND LOOKED AT DIFFERENT THINGS, THERE WERE AUDIT ADJUSTMENTS, WHICH WERE UNUSUAL, UM, FOR US TO HAVE HERE FOR THE COUNTY OF BUTLAND.
SO THAT THAT REPORT AND THAT FINDING IS IN THE VERY BACK RATHER LARGE TOO.
WE'LL HIT A COUPLE OF THOSE HERE IN JUST A FEW MINUTES.
SINCE, UH, WE'RE ON THAT TOPIC, I WILL SAY, UM, STAFF AND, UH, FINANCE AND AUDIT COMMITTEE, UH, HAVE MET WITH PB MAYORS HAD GOOD DISCUSSION.
UH, KEY ELEMENT OF THAT I WANNA STRESS IS, UH, I WAS VERY POINTED IN MY QUESTIONING TO MAKE SURE THIS IS A ONE TIME OCCUR, A FEELING OF A ONE TIME OCCURRENCE.
THIS WAS NOT SOMETHING THAT, UM, WAS A LARGER ISSUE THAT, YOU KNOW, WAS A, A SIGN OF THINGS TO COME.
UH, PB MAYORS ASSURED ME THAT IT WAS NOT THEIR FEELING THAT WAS THE CASE, THAT OUR POLICIES ARE STRONG, OUR PROCEDURES ARE STRONG.
IT WAS SIMPLY WE IN THIS, UH, AUDIT, IT WAS NOT AS, UH, TO A STANDARD THAT WE WOULD HOPE TO SEE FROM NEWLAND COUNTY.
UM, AND SO, UM, WITH THAT, UH, REMEDIES ARE, HAVE BEEN PERFORMED AND, UH, WE DO NOT HOPE TO SEE THAT EVER AGAIN.
UM, IF PETER MAYORS, IF THERE'S ANYTHING I SAID THAT YOU DO NOT AGREE WITH, WHICH TELL ME.
UM, BUT I, I DO THINK WE HAVE A PRO OR WE'VE BEEN RESPONSIVE AND DO NOT INTEND TO SEE THIS BECAUSE WE'VE HAD, THIS WAS A OUTLIER FROM THAT.
THAT WAS THE KEY THING I WANTED TO UNCOVER IS DID THIS FEEL LIKE AN OUTLIER OR SYMPTOM? AND IT, IT WAS A GENERAL CONSENSUS THAT THIS WAS AN OUTLIER.
IT'S SOMETHING THAT WE CAN ADDRESS AND FIX AND, UH, MOVING FORWARD AND NOT SEE THESE ISSUES ARISE AGAIN.
FOR LETTING THAT'S VERY FAIR STATEMENTS.
I'M HAPPY TO, TO STOP AND PAUSE.
UM, AND THEN WE ANTICIPATE ISSUING CLEAN OPINIONS AND CLEAN REPORTS ON YOUR SINGLE AUDIT AND FEDERAL AWARDS AS WELL.
UM, AT THE TIME THAT WE ISSUED THE FINANCIALS, UH, THE OMB, THE COMPLIANCE SUPPLEMENT HAD NOT BEEN ISSUED BY THE FEDERAL GOVERNMENT.
AND UNTIL THEY ISSUE THE SUPPLEMENT, WE CANNOT OPINE ON AND FINISH OUR SINGLE AUDIT WORK.
THAT HAS ACTUALLY HAPPENED IN THE LAST WEEK.
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GOT THE, THE COMPLIANCE SUPPLEMENT FINISHED AND ISSUED FOR US TO USE.SO WE WILL FINISH UP OUR FINANCIAL STATEMENT AUDITS, AND THEN WE'RE GONNA JUMP RIGHT INTO FINISHING EVERYBODY'S SINGLE AUDITS AND GETTING THOSE ISSUED AS QUICKLY AS WE CAN.
UM, AND SO THAT IS ON THE HORIZON.
UM, JUST TO REMIND YOU THAT IT'S NOT JUST THE AUDIT OF THIS DOCUMENT THAT WE DO.
UM, THERE ARE PROCEDURES THAT WE'RE REQUIRED TO DO FROM THE AUDITOR OF PUBLIC ACCOUNTS ON THE SHERIFF'S DEPARTMENT.
UM, THERE'S A TRANSMITTAL FORM THAT IS DUE TO THE STATE.
UM, DECEMBER 15TH, WE WILL HAVE THAT COMPLETE AND OUT THE DOOR ON TIME, WE'RE STILL WORKING ON THAT.
UM, THERE'S WORK WE DO ON FROM THEIR VIRGINIA RETIREMENT SYSTEMS VANTAGE POINT OF TESTING ELIGIBILITY AND, AND CERTAIN DOCUMENTS SO THEIR ACTUARIES CAN DO THEIR JOB.
THERE'S LANDFILL AGREED UPON PROCEDURES.
AND THEN THERE'S THE DATA COLLECTION FORM THAT WE COMPLETE ONCE THE SINGLE AUDIT IS DONE.
SO THAT'S JUST A REMINDER THAT THERE'S MORE THAN JUST THIS DOCUMENT THAT WE HAVE TO DO WORK ON.
AND A COUPLE OF THOSE ITEMS ARE STILL TO BE COMPLETED.
UM, AS AN AUDITOR, I WOULD LOVE FOR THINGS TO JUST BE BLACK AND WHITE AND I CAN TIE IT DOWN AND CONFIRM IT.
UM, BUT THERE ARE SOME PRE PRETTY SIGNIFICANT ESTIMATES AND JUDGMENTS, UM, IN THESE FINANCIAL STATEMENTS.
THIS IS JUST A LIST OF, UM, SOME OF THE LARGER ONES.
YOU KNOW, CAPITAL ASSETS, DEPRECIATION LIVES ARE, IS AN ESTIMATE.
UM, LANDFILL, POST CLOSURE LIABILITIES OBVIOUSLY ESTIMATE RETIREMENT LIABILITIES.
AND WE RELY ON ACTUARIES AND OTHER ENGINEERS AND THIRD PARTIES TO COME UP WITH THOSE ESTIMATES.
SO WE USE THEIR INFORMATION TO MAKE SURE THAT WHATEVER THEY SAY GETS RELATED TO THIS DOCUMENT.
UH, WE DID ADOPT SOME NEW ACCOUNTING POLICIES THIS YEAR.
UM, THE ONLY ONE I THINK WE PROBABLY NEED TO DISCUSS IS 1 0 1 COMPENSATED ABSENCES.
AND THAT HAS TO DO WITH TIME OFF VACATION, PTO, THOSE TYPES OF THINGS.
UM, THE GOVERNMENTAL COUNTY STANDARDS BOARD ISSUED A NEW STANDARD ON HOW TO MEASURE THAT NUMBER AND HOW TO CALCULATE IT.
UM, AND SO IF YOU WERE TO LOOK INTO YOUR FINANCIAL STATEMENTS, UM, WE DO HAVE A LINE CALLED RESTATEMENT AND IT'S ON PAGE 24 FOR THE MOST PART.
AND THEN THERE'S A FOOTNOTE AS WELL THAT DISCUSSES IT.
JUST THINK IT'S IMPORTANT TO POINT THAT OUT.
'CAUSE WITH EVERYTHING ELSE WE HAD GOING ON THIS YEAR WITH THE AUDIT, TYPICALLY IF YOU SEE A LINE THAT SAYS RESTATEMENT, THAT MEANS THERE'S AN ERROR AND THERE WAS NO ERROR IN THE CALCULATION.
SO THIS IS THE NEW WAY TO DO THINGS IN THE NEW WAY TO CALCULATE THINGS.
SO I THINK IT'S IMPORTANT TO POINT THAT OUT.
UM, WE HAD NO OTHER ADJUSTMENTS PROPOSED BY US THAT WERE NOT MADE, OR THAT WE FOUND THAT NEEDED TO BE MADE.
UM, AGAIN, MOST OF THOSE ADJUSTMENTS WERE AT THE COUNTY LEVEL, NOT THE SCHOOL BOARD OR THE EDA.
I AM NOT GOING TO SIT HERE AND READ THROUGH THESE.
UM, I KNOW YOU'VE HAD A CHANCE TO LOOK AT THIS AHEAD OF TIME.
WE HAVE SEVERAL SLIDES HERE, BUT ALL OF THESE ADJUSTMENTS FOR THE MOST PART.
UM, SO THIS WAS YOUR GENERAL FUND ADJUSTMENTS.
WE HAD, UM, HERE'S YOUR CAPITAL PROJECTS FUND AND SOME OF THE MORE SIGNIFICANT ADJUSTMENTS WE HAD THERE.
ALL OF THESE SUPPORT THAT ONE COMMENT IN THE BACK OF READINESS, RECONCILIATIONS BEING PERFORMED, THINGS OF THAT NATURE.
BUT AGAIN, WE FEEL LIKE IT'S PART OF OUR JOB NOT TO, NOT TO JUST GLOSS OVER IT, UM, BUT TO MAKE SURE THAT WE HAVE POINTED OUT TO THIS GROUP AT LEAST, UM, WHAT THOSE ADJUSTMENTS HAVE BEEN.
SO THAT'S THE REASON THAT THOSE ARE IN HERE FOR YOU.
AND JUST WHILE WE'RE ON IT, I WOULD, UH, ASK YOU ALL THOSE ADJUSTMENTS LEAD US TO THE CLEAN OPINION AND THE APPROPRIATE ACCOUNT, CORRECT.
YEAH, I MEAN, THAT'S JUST, I WANNA HIGHLIGHT THAT, THAT THE PRESENTATION IS THE ACCURATE NUMBERS.
THESE ADJUSTMENTS WERE MADE AS FAR AS WE CAN TELL BACK YES.
I DON'T WANT OUTSIDE AUDIENCE TO, UM, NOT REALIZE THAT THE CLEAN OPINION ELEMENT OF THIS.
SO WHEN WE FIND THESE TYPES OF ERRORS AND THINGS THAT NEED TO BE ADJUSTED, THAT'S WHEN WE DIG IN EVEN A LITTLE BIT FURTHER, DO MORE WORK, DO MORE TESTING SO THAT WE CAN ISSUE A CLEAN OPINION ON THAT FINANCIAL STATEMENT.
UM, JUST DISCUSSING THE SINGLE AUDIT, AGAIN, THOSE ARE THE MAJOR PROGRAMS. SPECIAL ED CORONAVIRUS, I BELIEVE IT'LL BE THE LAST YEAR OF THAT ONE.
YES, ANDREA CAN CORRECT ME, BUT I THINK WE'RE FINALLY DONE SPENDING ALL OF THAT FEDERAL MONEY, UM, THAT CAME THROUGH A FEW YEARS AGO.
AND AS IT SAYS THERE, THE SINGLE AUDIT WILL BE FINISHED.
UM, AND THAT SAYS ONCE THE COMPLIANCE SUPPLEMENTS ISSUED, BUT IT'S ISSUED.
SO WE'RE, WE'RE MOVING IN ON GETTING THAT DONE.
JUST SOME OTHER REQUIRED COMMUNICATIONS THAT WE HAVE AS YOUR AUDIT FIRM.
UM, THEY'RE ALL IN A LETTER AS WELL AS HERE ON THIS THING.
THIS TALKS ABOUT OUR RESPONSIBILITIES.
YOU KNOW, WE AUDIT UNDER GOVERNMENT AUDITS AND STANDARDS.
WE DO FOLLOW THE SINGLE AUDIT ACT AND THE COMPLIANT AND THE GUIDANCE THERE.
STATE OF VIRGINIA, THE AUDITOR OF PUBLIC ACCOUNTS HAS LOTS OF THINGS THEY WANT US TO DO ON THEIR BEHALF AND TO HELP WITH THE STATE AUDIT.
SO WE DO THOSE TYPES OF THINGS.
UM, AGAIN, WE COMMUNICATE AT THE TIME OF THE AUDIT,
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UM, COUNTY POLICIES AND PRACTICES.YOU KNOW, YOUR CHAIRMAN WAS JUST TALKING ABOUT THOSE THINGS ARE IN PLACE, THEY'RE HERE, UM, WE THINK THEY'RE GOOD, THEN YOU'D HAVE TO FOLLOW THEM, AND THEN YOU HAVE TO COMPLY BY 'EM.
AND THAT'S WHERE, UM, AT THE END OF THE YEAR, MAKING SURE THAT WE WERE GETTING RECONCILIATIONS DONE AND REVIEWS WAS NOT HAPPENING.
UM, WE JUST, WE JUST NEED TO DO A LITTLE BIT BETTER JOB GOING FORWARD.
AND AGAIN, AS YOU SAID, IT'S AN OUTLIER YEAR OF ALL THE YEARS WE'VE BEEN HERE, THIS HAS NEVER HAPPENED FOR US.
SO I DON'T, I DON'T EXPECT IT TO HAPPEN GOING FORWARD, BUT WE'LL LEAVE THAT UP TO DATE AND HOW THIS CREW HANDLES ALL OF THAT.
SO, UM, WE'VE ALREADY COMMUNICATED OUR AUDIT ADJUSTMENTS, BUT DISAGREEMENTS WITH MANAGEMENT, THERE WERE NONE.
SO EVEN AS WE WENT THROUGH ALL OF OUR ADJUSTMENTS AND AUDIT CORRECTIONS, THEY AGREED WITH EVERYTHING THAT WE PRESENTED.
UM, NO OTHER SIGNIFICANT ISSUES, YOU KNOW, DIFFICULTIES ENCOUNTERED THERE.
AND, YOU KNOW, OBVIOUSLY THEY WEREN'T QUITE READY.
TESTING REQUIRED A LITTLE BIT MORE TESTING ON OUR PART, BUT AT THE END OF THE DAY, WE'RE ABLE TO FINISH OUR AUDIT IN ALL OF OUR AUDIT PROCEDURES.
UM, AND YOU'LL SEE A COPY OF THE ENGAGEMENT LETTER AND A REPRESENTATION LETTER IN OUR REPORTING PACKAGE.
UM, AND OF COURSE, IN THIS DOCUMENT, UM, THE INTRODUCTORY SECTION, WHICH INCLUDES A COUPLE LETTERS, UM, THE STATISTICAL SECTION IN THE BACK, WE DO NOT AUDIT THOSE.
AND SO WE DO NOT OPINE ONE THOSE SECTIONS AND WHAT'S IN THERE.
SO THAT'S WHAT THAT BOTTOM BULLET POINT IS SAYING, IS THE AREAS THAT WE WILL AUDIT IN THE OTHER AREAS THAT WE DO NOT.
UM, WE'VE TALKED ABOUT QUALITY OF THE AUDITING PRINCIPLES.
FRAUD AND ILLEGAL ACTS ALWAYS JUMPS OUT AT EVERYBODY.
YOU READ THE COMMENTS, WE DID NOT SEE ANY
AND ESPECIALLY IN PARTICULAR TO THE ADJUSTMENTS WE WERE LOOKING AT.
UM, INDEPENDENCE OBVIOUSLY IS A VERY, VERY SHARED RELATIONSHIP BETWEEN US AND YOU AND THE BOARD.
UM, WE MAKE SURE WE DON'T AGREE TO DO ANYTHING THAT WE SHOULDN'T.
AS IN, LET'S SAY WE WERE LOOKING AT THESE AUDIT ADJUSTMENTS AND CARLA SAID, HEY, CAN YOU GO POST THOSE SECOND? I POST THAT ENTRY, I'M NO LONGER INDEPENDENT.
UM, I'M IN YOUR SYSTEM DOING THINGS THAT MANAGEMENT SHOULD BE DOING.
SO WE MAKE SURE WE ADHERE TO THOSE INDEPENDENCE POLICIES.
AND IT'S UP TO YOU GUYS TO MAKE SURE WE DO THAT AS WELL.
UM, WE HAVE ISSUED A SEPARATE MANAGEMENT LETTER.
UH, I DON'T KNOW IF YOU HAVE THAT IN FRONT OF YOU, BUT MOST OF THAT LETTER IS REALLY JUST TALKING ABOUT GING PRONOUNCEMENTS THAT ARE COMING DOWN THE ROAD.
AND WITH THAT VERY QUICK OVERVIEW OF THE AUDIT, UM, AND, AND THE YEAR THAT WE HAD AND THE ITEMS THAT WE STILL HAVE OUTSTANDING, BUT ANY OTHER COMMENTS AND POINTS YOU WANNA MAKE AND QUESTIONS? SURE.
CAN YOU GO BACK TO SOME OF THOSE ADJUSTMENTS? ONE OF 'EM SURPRISED ME, UM, AND I JUST WANNA MAKE SURE I UNDERSTAND WHAT IT'S THAT TAX RECEIVABLES AND UNAVAILABLE REVENUES.
SO IN MY OFFICE, WE BALANCE TAX RECEIVABLES EVERY MONTH.
SO IS THAT SOMETHING DIFFERENT THAN WHAT WE'RE BALANCING? YES.
THIS IS RELATED TO A-G-F-O-A COMMENT THAT WAS, UM, RECEIVED DURING THE PREVIOUS APPLICATION PROCESS.
AS FAR AS THE ACCOUNTING OF THE TIMING FOR THE SECOND HALF, IT DOESN'T HAVE ANYTHING TO DO WITH, UM, THE WAY YOUR OFFICE BALANCE.
WE DIDN'T HAVE, I JUST WANNA MAKE SURE NO, JUST TO CONFIRM, WE HAD NO ISSUE WITH THE WAY YOUR OFFICE SPECIFICALLY IS BALANCING IT.
THIS IS PURELY JUST FOR PRESENTATION PURPOSES.
DURING THE AUDIT PROCESS, IS THERE, ARE THERE, IS IT SCALABLE LIKE, LIKE SAY EACH FINDING OR WHAT YOU'RE LOOKING FOR? OR IS IT, I GUESS MY ULTIMATE QUESTION IS, IS THERE ANYWHERE THAT WE WERE LEANING TOWARDS WEAKNESS? SO WE HAVE, UM, DIFFERENT OPINION UNITS AND WE SET MATERIALITY BASED ON EACH SIZE OF THE OPINION UNITS, WHICH IS WHY ON THE ADJUSTMENTS, UM, SCREENS, YOU SEE ONE PAGE FOR EACH OPINION UNIT.
WE DIDN'T HAVE ANY OPINION UNITS WHERE, UM, THE ADJUSTMENTS WERE PERHAPS ON THE BUBBLE AND DIDN'T QUITE REACH THE MATERIAL WEAKNESS LEVEL.
IS THAT YOUR QUESTION? UH, IN, IN A WAY YEAH.
I WAS JUST, I WAS, I'M HOPING TO PREVENT THIS, YOU KNOW, EVER HAVING ANY EVENTS.
I'M WONDERING IF, LIKE, AS AN AUDITOR, IF, IF I WERE YOU, IS IT A YES NO? OR IS IT MORE OF A SCALABLE? IT CAN BE SCALABLE.
YOU KNOW, IF IF WE HAVE ONE ADJUSTMENT THAT'S A MATERIAL ADJUSTMENT, THEN WE ARE REQUIRED TO REPORT THAT AS A MATERIAL FIRE.
UM, TYPICALLY NOW YOU CAN ALSO HAVE SEVERAL, THERE'S THREE DIFFERENT LEVELS.
MATERIAL WEAKNESS IS THE WORST.
THERE'S SIGNIFICANT DEFICIENCY, AND THEN THERE'S A CONTROLLED DEFICIENCY.
YOU CAN HAVE SEVERAL CONTROLLED DEFICIENCIES, AND IF YOU LOOK AT 'EM ALL TOGETHER, YOU MAY SAY, WE'VE GOT A MATERIAL WEAKNESS HERE, BUT THAT'S PRETTY RARE.
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USUALLY YOU'LL JUST SPELL OUT ALL YOUR DIFFERENT CONTROLLED DEFICIENCIES.UM, IF YOU HAVE SIGNIFICANT DEFICIENCIES, USUALLY TWO OR THREE OF THOSE CAN LEAD YOU TO THEN HAVING MATERIAL WEAKNESS AS WELL.
BUT ONCE YOU CROSS THAT THRESHOLD OF MATERIALITY THAT WE HAVE SET AND YOU REACH IT, IT'S AUTOMATICALLY A MATERIAL WEAKNESS.
WELL, I, I GUESS WHAT I'M, WHAT I'M LOOKING FOR IS IN THE PROCESS, IS THERE ANY WAY TO TELL, HEY, NEXT YEAR YOU GUYS MIGHT WANT TO LOOK OUT FOR THIS? WELL, IT'S NOT A HIT TO THIS YEAR, NEXT YEAR IF IT CONTINUES TO TREND THIS WAY.
UM, AND, AND WE SEND OUT, UM, WHAT WE CALL THE PB SOLICIT PREPARED BY CLIENT LIST BEFORE OUR PRELIMINARY AND FINAL FIELD WORK.
SO WE SEND A LIST OF, HERE ARE THE AREAS THAT WE'VE IDENTIFIED THIS YEAR THAT WE'RE GONNA BE FOCUSED ON.
GIVE US SHEER RECONCILIATIONS, MAKE SURE THINGS TIE BACK TO THE GENERAL LEDGER.
WE MIGHT WANNA SEE SUBSIDIARY LEDGERS, THINGS OF THAT NATURE.
SO WE SEND THOSE LISTS OUT AHEAD OF TIME SO YOU KNOW WHERE WE'RE GOING TO BE.
ACCOUNTS THAT WE'RE FOCUSED ON.
UM, AND EVEN KNOWING THAT WE STILL HAVE PROBLEMS WITH RECONCI, I DO WANT TO, YOU KNOW, HIGHLIGHT A POINT HERE IS ONE OF THE QUESTIONS THAT I POSED TO PB MAYORS IS WHAT COULD FINANCE AND AUDIT COMMITTEE HAVE DONE DIFFERENTLY? AND THE RESPONSE I GOT WAS, YOU'VE GOT THE POLICIES, YOU'VE GOT THE GOVERNANCE, THIS WAS EXECUTION.
THAT'S WHERE THE FOCUS NEEDS TO BE, WHICH I IMMEDIATELY PIVOTED TO JEREMY.
AND, UH, AND THAT'S, AND, AND THE REAL COMFORT IS THAT IT'S BEING ADDRESSED AND IT'S TO MAKE, TO ENSURE THAT WE GO RIGHT BACK TO EVERYTHING WE WERE DOING BEFORE, WHICH IS CLEAN, NO DEFICIENCIES, NOTHING NOTED.
UM, AND I THINK THAT'S IMPORTANT TO HIGHLIGHT, YOU KNOW, EVEN THOUGH PEOPLE DIDN'T BREAK THE WEATHER, WE DO HAVE IT RECORDED.
UM, IS THE GOVERNANCE IS STILL SOUND WE NEED, WE NOW NEED TO MAKE SURE THE FOCUS IS WHAT ARE WE DOING AND BLOCK BLOCKING AND TACKLING, SO TO SPEAK, SO THAT, UM, WE GO RIGHT BACK TO THE STANDARD.
AND, UM, BUT THAT QUESTION WAS IMMEDIATELY, I, I WANTED TO ADDRESS DID WE FALL SHORT? DID WE NOT DO SOMETHING? AND PB MES ASSURED ME.
AND, UH, YOU KNOW, IT'S, AND AND THEY ALSO SAID VERY QUICKLY, THIS IS ADDRESSABLE.
THIS IS ACHIEVABLE IN SHORT ORDER.
AND, AND WE DON'T TYPICALLY CALL, TRY TO GET THIS GROUP TOGETHER FOR SPECIAL MEETINGS AND THINGS OF THAT NATURE.
YOU KNOW, WE KNEW WE HAD ISSUES.
WE WANTED TO MAKE SURE WE HAD THEM ALL ADDRESSED BEFORE WE DRAFTED OUR LETTERS AND SENT EVERYTHING OUT AND DRAFT FOR EVERYBODY TO LOOK AT.
IF THERE WERE FRAUD THEFT OR SOMETHING LIKE THAT.
WE WOULD CALL THESE MEETINGS AND ME TO GO TO AN EXECUTIVE SESSION, UM, TO HAVE THOSE DISCUSSIONS.
BUT, UH, WE DIDN'T FEEL THAT IT WAS NECESSARY TO BRING THIS TO YOUR ALL'S ATTENTION WHILE IT WAS HAPPENING.
UNTIL WE KNEW EVERYTHING, WE KNEW EXACTLY WHERE IT WERE.
WELL, I THINK WE KNEW THAT THERE WAS GONNA BE SOME ADJUSTMENTS.
I, I DIDN'T KNOW TO WHAT EXTENT.
UM, AND WE'VE TALKED ABOUT THIS BEING A ONE OFF, BUT THESE ARE MULTIPLE, THERE'S A LOT OF THAT ADJUSTMENT INJURIES HERE.
UH, SO IT'S A SYSTEMIC THING THAT WE LET OUR GUARD DOWN AND NOW WE'VE REGAINED OUR GUARD,
AND, UH, I, I'D LIKE TO UNDERSTAND LIKE THE CORRECTED, UH, PROPERTY TAXES.
SO WHAT HAVE, WHAT, THERE ARE GONNA BE A DEBIT AND A CREDIT HERE, A BUNCH OF DEBITS AND A BUNCH OF CREDITS, UH, ONE BIG DEBIT AND A BUNCH OF SMALL CREDITS TO EQUAL WHAT, TAKE ME THROUGH THAT ONE TRANSAC THING.
WHAT DID YOU, WHAT WAS THAT ADJUSTMENT? WHAT DID YOU HAVE TO ADJUST? WHAT WAS WRONG THAT YOU HAD TO CORRECT? IT WAS THE TIMING OF THE TREATMENT OF THE SECOND HALF PROPERTY TAXES, UHHUH
SO IT'S NOT YOUR OVERALL PROPERTY TAXES BEING WRONG, IT'S JUST WHICH PIECE IS DEFERRED AND THAT, THAT THAT ENTRY, THAT CORRECTION HAS TO DO WITH WHICH, WHICH FISCAL YEAR IT GETS RECOGNIZED IN MM-HMM
SO IN THIS INSTANCE, HOW IT GETS DISPLAYED, WHETHER IT'S A BALANCE SHEET LIABILITY OR IF IT'S A CURRENT YEAR REVENUE AND WE HAD HAD IT OR, AND WHAT TYPE OF LIABILITY IT SHOULD BE SHOWN AS ON THE BALANCE SHEET AND THAT ENTRY AND THAT PIECE.
CORRECT ME WHEN I'M WRONG, ANDREA HAD A LOT MORE TO DO WITH THE DISCLOSURE, THE DISPLAY ON THE BALANCE SHEET YES.
THAN OUR DEBITS AND CREDITS AND MAKING SURE WE HAD IT IN CREDIT.
SO, SO WHAT I'M GETTING AT, WHEN WE LOOK AT FINANCIALS, WE, WE MAKE, MAKE CERTAIN DECISIONS BASED ON THOSE WHAT'S REPORTED, WHETHER THE FUNDS WE
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HAVE AVAILABLE TO SPEND OR WHATEVER, WE'RE GONNA DO WHATEVER DECISIONS WE'RE MAKING BASED ON THESE, ASSUMING THAT THEY'RE ACCURATE.SO HOW DOES THAT AFFECT OUR DECISION PROCESS THAT WE'RE GOING GO FROM YEAR TO YEAR? SO YOU KNOW, THAT MUCH MONEY IN A PRIOR YEAR OR, YOU KNOW, IF IT'S REVENUES, IS THAT WHAT IT WAS? TAXES SEEM TO BE REVENUE TO MAKE.
SO I I, I DO THINK THAT, AND I HAVEN'T BEEN BACK THROUGH YOUR MONTHLY REPORTING PACKAGES, WHAT YOU LOOK AT TO TRY TO MAKE THOSE DECISIONS.
I DO THINK FOR THE MOST PART, AND FOR THE MAJORITY OF THE YEAR, THOSE RECONCILIATIONS WERE BEING DONE TREASURER'S OFFICE, AND EVERYONE'S DOING WHAT THEY NEED TO DO, THE SCHOOL BOARD'S DOING WHAT THEY NEED TO DO.
UM, AND I, I THINK YOU HAD ACCURATE INFORMATION WHEN YOU'RE TRYING TO MAKE THOSE TYPES OF DECISIONS.
ARE WE RAISING THE TAX RATE, WE LOWERING THE TAX RATE? ARE WE GOING OUT TO DEBT AND ISSUING BONDS? HOW ARE WE GONNA COVER THESE BONDS? THOSE TYPES OF BIG DECISIONS.
I DO THINK THE INFORMATION YOU HAD WAS, WAS CORRECT.
ONCE WE GOT DOWN TO THE END OF THE YEAR, WE START RECONCILING SOME DIFFERENT ACCOUNTS.
I THINK YOUR CASH IN AND OUT WAS CORRECT FOR THE MOST PART.
I THINK YOUR REVENUES THAT YOU'RE LOOKING AT TRYING TO MAKE DECISIONS ARE CORRECT.
THEN YOU GET TO THOSE YEAR ACCRUALS WHERE WE START.
OKAY, WELL LET'S WE START THE ACCOUNTING PIECE.
SAY THAT, YOU KNOW, AND THE OTHER QUESTION I HAVE, AND I WANNA UNDERSTAND WHAT A SINGLE AUDIT IS,
THERE'S VARIOUS AUDITS THAT SORT OF INDEPENDENT, AND SO YOUR AUDIT IS CERTAIN FUNCTION OR WHATEVER.
IS THAT WHAT A SINGLE AUDIT IS? SO A SINGLE AUDIT IS, WE ARE LOOKING JUST AT THE FEDERAL DOLLARS THAT YOU HAVE RECEIVED AND SPENT.
UM, AND SO THE UNIFORM GUIDANCE ISSUED BY THE OFFICE OF MANAGEMENT AND BUDGET IN WASHINGTON DC SAYS, HERE'S ALL THE HUNDREDS OF PROGRAMS WE HAVE, AND HERE ARE THE GUIDELINES THAT THE COUNTY AND SCHOOLS EVERYBODY'S SUPPOSED TO BE FOLLOWING.
AND THEN WE COME IN AND DO A RISK ASSESSMENT OF THOSE PROGRAMS AND CHOOSE WHICH ONES WE'RE GOING TO AUDIT OF JUST THE FEDERAL DOLLARS.
AND THEN WE AUDIT JUST ON, WE DO SPECIAL WORK JUST ON YOUR FEDERAL DOLLARS OF EXPENDITURES.
AND AGAIN, THAT CAN BE AT THE COUNTY, IT'S GONNA BE AT THE SCHOOLS, IT'S SOCIAL SERVICES, IT'S WHEREVER YOU, IF THE SHERIFF'S OFFICE HAS RECEIVED A GREAT BIG GRANT, FEDERAL DOLLARS, WE'RE GONNA LOOK AT THOSE THINGS.
SO THAT PIECE IS WHERE WE HAVEN'T FINISHED ISSUING IT YET, BECAUSE AGAIN, WE WERE WAITING ON THE FEDERAL GOVERNMENT TO TELL US WHAT PROGRAMS WERE AND WHAT, WHAT THEY WANTED US TO OFFER.
AND YOU PROBABLY ENSURE WE GET WHAT'S COMING TO US.
I DO NOT ENSURE WHAT'S IN COMING TO YOU.
I MAKE, I JUST LOOK AT WHAT YOU SPENT.
NOW IF I SEE THAT WE HAVEN'T ASKED FOR, UM, A RECEIVABLE, WE HAVEN'T ASKED FOR OUR MONEY BACK, WE WILL SEE THAT AND SAY, HEY, WHY HAVEN'T YOU GUYS DONE THAT? BUT USUALLY THAT'S PRETTY RARE.
AND THE OTHER QUESTION I HAVE DOES THIS ALL ONE SOMEWHAT OF AN INTERIM LOOK, SEE TWO, THREE MONTHS FROM NOW TO SEE IF WE CORRECTED OUR SYSTEMS AND PROCEDURES TO MAKE SURE THAT WAS HAVING, TO ME THAT LARGE OF A THING.
IF I'M IN, IF I'M IN THE, IF I'M A CLERK, I WOULD PICK UP ON SOMETHING'S WRONG HERE.
YOU KNOW, SO THE AWARENESS BOTHERS ME THAT SOMEBODY DIDN'T PICK UP ON THAT.
I THINK THAT THAT GOTTA BE WRONG.
GOES BACK TO YOUR EARLIER QUESTION OF TRUST AND VERIFY.
AND I THINK UP TO THIS POINT, OUR DIRECTORS OF FINANCE HAD DONE A VERY GOOD JOB AND WE TRUSTED THEM TO DO THE WORK.
I'M GONNA LET, AND SO YOU DON'T, YOU DON'T LOOK OVER THEIR SHOULDER EVERY DAY OR EVERY WEEK, EVERY MONTH, SAY, ARE YOU DOING WHAT YOU HAVE BEEN DOING FOR ME BEFORE? YOU JUST ASSUME THAT THEY HAVE BEEN.
UM, AND THEN WE GOT TO THIS POINT AND IT HAD NOT BEEN DONE.
AND I, I WOULD ALSO MAKE THE DISTINCTION BETWEEN THE ENTRIES THAT HAPPEN ALL YEAR LONG MM-HMM
AND THEN YOU HAVE THE CLOSING.
SO THIS IS A LIKE A CLOSING HAND.
SO I WOULD, UM, THE OBSERVATION WE MADE WAS THAT THERE APPEARED TO BE A LOT OF COMPRESSION DURING THE CLOSING PROCESS, WHICH THEN PEOPLE RUSH, WHICH THEN THINGS, ENTRIES WERE MADE BACKWARDS OR MADE TWICE OR FORGOTTEN TO BE MADE WHERE IF ONE EXTRA LITTLE LAYER OF REVIEW THAT'S SUPPOSED TO BE IN PLACE HAD OCCURRED, IT WOULD VERY EASILY HAVE BEEN BEEN CAUGHT.
SO THE FIX IS NOT A MYSTERY AND THE FIX IS IN PROGRESS.
UM, WE'VE SPOKEN AT LENGTH ABOUT, YOU KNOW, WHAT'S GOING TO HAPPEN IN THE FUTURE, UM, TRYING TO AVOID THE COMPRESSION DURING THE CLOSING PROCESS.
SOME OF THE CLOSING ENTRIES, FOR EXAMPLE, RELATED TO CAPITAL ASSETS COULD HAPPEN QUARTERLY THROUGHOUT THE YEAR.
IT DOESN'T ALL HAVE TO HAPPEN ALL IN THE FOURTH QUARTER.
SO IT'S THE, I'M NOT GONNA SAY IT'S AN EASY FIX, BUT IT'S NOT A MYSTERIOUS FIX.
SO LAST THING, THE CHANCES OF RECURRING Y'ALL AND I CONCERNED ABOUT THAT, YOU THINK, BECAUSE I DIDN'T THINK WHAT HAPPENED THIS YEAR.
SO IT WASN'T EXPECTING FOR IT TO HAPPEN THIS YEAR.
[00:25:01]
UM, I'VE NOT WORKED WITH DAVE.I THINK HE'S GONNA DO A GREAT JOB, BUT I DON'T KNOW UNTIL I SEE, DOES SAY ADD SOMETHING THAT'S NOT UP TO ME.
I I THINK A LOT OF THIS IS JUST AS YOU SAID, GOOD WORK COMPRESSION PEOPLE TRYING TO DO TOO MANY THINGS AT ONE TIME.
A LOT OF CHANGES IN THE WAY SOME OF THESE, THESE ENTRIES WERE MADE OR CHANGES IN THE ACCOUNTING POLICIES.
UH, AND NOT, NOT HAVING A THIRD QUARTER REVIEW, A FORMAL THIRD QUARTER REVIEW WHERE I MENTIONED TO YOU MY, MY POLICIES ALWAYS, WE WERE OUR THIRD QUARTER REVIEW ALL THE RECONCILIATIONS.
WE'LL LOOK AT 'EM, EVERY ONE OF THEM, AND WE WILL MOVE INTO THE FOURTH QUARTER WITH OUR PROPOSED ENTRIES THAT, I MEAN, THIS, THIS CORRECT SECOND HALF PROPERTY TAXES, I'VE SEEN THIS 57, I'VE SEEN ERROR BASIC.
IT'S A VERY BASIC, IT'S EASY ENTRY FOR THIS OR TO MAKE AN ERROR, BUT IF YOU LOOK AT IT, YOU GO, THIS CAN'T BE RIGHT.
MY DEFERRED HAS GONE FROM 30 MILLION TO NOTHING OR SOMETHING LIKE THAT.
SO THESE ARE ENTRIES THAT I CALL COMMUNICATIONS ISSUES FOR THE MOST PART.
PLEASE CORRECT ME BECAUSE YOU SAW MORE, YOU SEE MORE OF IT THAN I HAVE.
BUT MOST OF THIS IS JUST COMMUNICATIONS SITTING DOWN AND LOOKING AT WHAT MAKES SENSE.
AND I'VE HEARD FROM THE STAFF, BASICALLY, YES, WE HAD A LOT OF COMPRESSION THERE, A LOT OF STUFF GOING ON AT THAT SAME TIME.
AND I CALL SOMEBODY WAS ASLEEP, THE SWITCH JUST DID NOT LOOK AT THE THINGS THAT YOU LOOK AT.
FOR WHATEVER REASON, I DON'T WHAT THEY ARE.
I'M FOCUSING, WELL, THIS GENTLEMAN JUST SAYS WE CAN'T HAVE IT HAPPEN AGAIN.
WE WE'LL PUT POLICIES AND PROCEDURES IN PLACE TO MAKE IT, MAKE SURE IT DOESN'T.
NOW, PART OF THE THINGS THAT I SENT TO THE JURY WAS MY LIST OF CORRECTIVE ACTIONS AND WHAT WE'RE GONNA DO AND HOW WE'RE GONNA TRACK WHAT WE DO AND HOW WE DO TO MAKE SURE THAT WE RECONCILE THESE ACCOUNTS AND WE'RE LOOKING AT ACCOUNTS CONSTRUCTIVELY TO SEE IF THERE'S SOMETHING REALLY OUTTA WHACK THAT WE SHOULD LOOK AT BEFORE WE HAND TO YOU.
THE OBJECTIVE IN THE FINANCE DEPARTMENT SHOULD BE TO HAND P MAYORS A CLEAN GENERAL
AND SO YOU STAND BACK AND YOU GO, I I WANT TO HAND YOU A DOCUMENT TRIAL BALANCE THAT YOU'RE LOOKING AT AND YOU ARE AUDITING.
AND IF THERE'S AN ENTRY TO BE MADE, IT'S EITHER A MISTAKE, A CHANGE IN POLICY OR PROCEDURE OR GOVERNMENTAL CHANGE THAT WE KNOW ABOUT IN THE THIRD AND FOURTH QUARTER.
AND SO WHAT I NORMALLY DO IN THIRD QUARTER START IN THE FOURTH QUARTER IS WE STAND BACK AND GO, WHAT IS IT? YOU KNOW, WE'RE NOT DOING WHAT'S COMING DOWN THE PIPE THAT NEEDS TO BE DONE FOR US TO MAKE SURE WE'RE HANDING.
THE ONE THING I'LL BRING UP IS, I SAID THIS TO EARLY DAYS, IT KIND IS GOING THROUGH A FLEX.
A LOT OF STUFF HAPPENING, A LOT OF VERY TECHNICAL THINGS THAT ARE GOING ON IN THE FINANCIAL WORLD, SOME OF THE MONEY SPEND LOOKED AT, AND ALSO THE AUDIT PROCESSES THAT ARE RELATED TO THOSE TRANSACTIONS.
WE JUST HAVE TO MAKE SURE WE DON'T GET CAUGHT IN THE LAW AND WE GOTTA MAKE SURE WE COMMUNICATE WITH
SAY WE ARE SEEING THE FOLLOWING THINGS AND WE WANNA MAKE SURE THIS DOES NOT HAPPEN.
SO I'VE BEEN TALKING TO THE STAFF ABOUT WHAT IS IT THEY NEED, WHAT IS THEY SEEING, WHAT IS IT THEY DID NOT UNDERSTAND? WHERE DID WE, WE MISS IT.
AND THEY'VE ALL BEEN VERY CONTROL AND THE WORD COMPRESSION IS VERY, VERY GOOD WORK.
BUT RIGHT NOW THEY'RE ALL FOCUSED ON MAKING SURE THIS DOES NOT HAPPEN AGAIN.
AND THEY ARE EMBARRASSED ABOUT IT.
SO I WANNA MAKE ONE QUICK COMMENT THAT I THINK WILL SEGUE TO DR.
LEY, UM, WITH NEW ADMINIS, WITH NEW ADMINISTRATION, UM, COMES A NEW FOCUS ON PROCESSES, PROCEDURES, ALL THOSE THINGS.
ONE OF THE BEST THINGS THAT HAS COME FROM DR.
RAIL'S, UH, SHORT TENURE ALREADY IS HONING IN ON HOW EACH OF THESE DEPARTMENTS WORKS.
HOW WE ARE HAVING BEST PRACTICES ACROSS THE BOARD.
UM, I, I CAN'T THINK, YOU KNOW, YOU, YOU ALWAYS HAVE TO TAKE YOU CHALLENGES, THE HICCUPS YOU HAVE AND SAY, OKAY, HOW DO WE ENSURE WE DON'T DO THEM AGAIN? I CAN'T THINK OF A MORE, A BETTER TIME TO HAVE UNCOVERED SOMETHING THAT WE WANT TO FIX AND MAKE SURE IT NEVER HAPPENS AGAIN BECAUSE WE'RE SEEING THIS TYPE OF ACTIVITY ACROSS THE BOARD, UM, IN OUR STAFF.
AND, UM, AND SO I THINK, YOU KNOW, AS IT, AS IT RELATES TO ADDRESSING THIS AS IT RELATES IT, THIS IS NOW SOMETHING THAT IS OCCURRING IN EVERY DEPARTMENT, NOT JUST FINANCE AND, UM, AND SO, SO THAT IT'S NOT SYSTEMIC SO THAT IT IS ONE OFF AND SO THAT WE GET THIS TYPE OF, UH, PROCESS AND PROCEDURE THAT IS FLAWLESS MOVING FORWARD.
SO I DO, I DO WANT TO STRESS THAT THIS IS, UM,
[00:30:01]
THIS IS SOMETHING THAT WOULD'VE COME UP.I, I FEEL COM CONFIDENT THAT IT WOULD'VE COME UP.
I I THINK IT'S GREAT THAT P MAYOR'S IDENTIFIED IT IN ADVANCE THROUGH THE PROCESS THAT WE ALREADY HAVE IN PLACE.
I, I JUST WANNA AFFIRM MY COMMITMENT AS COUNTY ADMINISTRATOR THAT THIS IS A ONE HIT WONDER THAT THIS IS NOT GOING TO TAKE PLACE IN THE FUTURE.
THAT WE HAVE ALREADY ESTABLISHED PROCESSES AND WILL CONTINUE TO IMPLEMENT THOSE PROCESSES SO THAT WE HAVE GREATER OVERSIGHT AND ACCOUNTABILITY AS A TEAM AND FULLY PREPARED FOR PB MAYORS WHEN THEY WALK IN THE DOOR IN THE SPRING OF THE YEAR, AND THEN EVEN MORE PREPARED WHEN THEY WALK IN THE DOOR IN AUGUST SO THAT EVERYTHING IS TIGHT AND READY AND RECONCILED.
UH, WE'VE ALREADY ESTABLISHED THAT WE'RE GONNA CONTINUE TO DO THAT.
AS SOON AS I WAS MADE AWARE OF THIS, MY FIRST CALL WAS TO PB MAYORS AND SAID, THIS IS NOT ACCEPTABLE.
WHAT CAN I DO? I WANT TO BE INVOLVED SO THAT WE HAVE A PROCESS TOGETHER WHERE WE'RE LOCKING SHOULDER TO SHOULDER AND WORKING TOGETHER SO THAT THIS IS NOT GOING TO HAPPEN IN THE FUTURE.
SO YOU HAVE MY COMMITMENT TO THAT AND, UH, WE ARE GOING TO MAKE SURE THAT THIS TIME NEXT YEAR IT'S A MUCH DIFFERENT, UH, REPORT.
I JUST WANT TO LEAVE WITH, I AM COMFORTABLE THAT THESE, THAT WE DO HAVE A CLEAN,
SO, AND THAT'S, THAT'S COMFORTABLE.
SO, AND JUST TO REITERATE, THERE'S BEEN A YEAR OF A LOT OF CHANGE AND I THINK A LOT OF VERY POSITIVE CHANGE AND, YOU KNOW, SOME OF THAT EMANATED FROM THE BOARD OF SUPERVISORS SEEING THE NEED.
AND, UH, SO, UH, I THINK, YOU KNOW, I'M VERY HAPPY WITH THE RESULTS SO FAR AND THEIR CHANGES MADE AND THE IMPROVEMENTS.
SO, BUT YOU DIDN'T ASK MY QUESTION ABOUT AN INTERIM, SO I FAILED TO REALIZE THEY'RE PROBABLY BACK IN SPRING.
IN THE SPRING WE WILL BE BACK IN ABOUT FOUR MONTHS TO GIVE.
SO YOU COULD TAKE A LOOK, MAYBE LOOK OVER YOUR SHOULDER AT THAT POINT TO SEE WHAT YOU FEEL LIKE.
RAYLEY ON THE, AND PERHAPS YOU AS WELL ON THE COMPRESSION SIDE, ARE THERE, UH, NOT TASKS, BUT UM, IS THERE PART OF THE WORKLOAD THAT WE COULD KIND OF SHIFT SPREAD OUT THROUGHOUT THE YEAR THAT YES.
KIND OF LED TO? YES, I THINK THAT'S THE KEY, MR. CHRISTIE IS QUARTERLY RECONCILIATIONS, MAKING SURE THAT WE'RE PREPARING FOR THIS THROUGHOUT THE COURSE OF THE YEAR RATHER THAN TWO WEEKS WHEN THE AUDITORS, OR ONE WEEK OR A COUPLE DAYS WHEN THE AUDITORS COME IN, THAT WE ARE FULLY PREPARING SO THAT WHEN THEY WALK IN THE DOOR, EVERYTHING HAS BEEN RECONCILED OVER TIME.
AND SO THOSE QUARTERLY RECONCILIATIONS ARE GOING TO BE KEY AND ALSO IS BUILDING THE CAPACITY OF OUR TEAM REGARDING GASB AND UNDERSTANDING THE COMPLEXITIES OF GS BS.
I REMEMBER WHEN I WAS A DIRECTOR OF FINANCE YEARS AGO, I WAS DEALING WITH GSB 45, IT'S ONLY BEEN LIKE 10 YEARS AGO.
AND SO THAT IS AN EXTREMELY COMPLEX OPERATION THAT I WANT TO SUPPORT OUR TEAM IN BUILDING THEIR CAPACITY AND THOSE UNDERSTANDING SO THAT WE CAN BE EVEN MORE PREPARED.
SO THERE ARE VARIETY OF FACTORS, BUT YES, DOING THINGS PERIODICALLY OVER TIME WILL BE A KEY INDICATOR.
MIKE AND ANDREA, ARE YOU ALL JUST ARE, ARE YOU ALL SEEING THE UTILIZATION OF AI THROUGHOUT YOUR PROCESSES AND PRACTICES? AND, AND I ASK THAT BECAUSE I WANT TO BE PROACTIVE AS IT RELATES TO THE COUNTY IN REGARDS TO IMPLEMENTING THE RIGHT TECHNIQUES, THE RIGHT THINGS THAT ARE MAKING YOUR LIVES EASIER, MAKING YOU ALL MORE EFFECTIVE IN THE WORK YOU DO.
AND I WANT TO MAKE SURE THAT OUR STAFF IS GETTING THE TRAINING THEY NEED TO BE AS, UM, AS EFFICIENT AS POSSIBLE.
UM, THAT MIGHT NOT BE AN ANSWER RIGHT NOW, BUT SLOWLY YEAH.
I WE DON'T HAVE ANY GOVERNMENT CLIENTS THAT I'M AWARE OF THAT'S REALLY USING AI IN ANY CAPACITY.
UM, FOR WHATEVER THE REASONS ARE.
I MEAN, YOU HAVE A LOT OF PUBLIC INFORMATION, EVERYTHING, ALMOST EVERYTHING IS FOIBLE, BUT THE LAST THING YOU ALSO WANT IS SOMEBODY TO BE ABLE TO ACCESS IT AND CHAT GPT WITHOUT ASKING YOU FOR IT.
UM, SO I THINK A LOT OF LOCALITIES AND GOVERNMENTS IN GENERAL ARE, ARE VERY CAUTIOUS IN HOW THEY WANT TO USE AI AND WHAT THEY WANT TO USE IT FOR.
SO WE HAVE A TASK FORCE OF PEOPLE,
[00:35:01]
UH, WE HAVE QUARTERLY, MONTHLY TRAININGS IN AI IN THE AREAS THAT WE ARE ALLOWED TO USE IN AREAS THAT WE'RE NOT ALLOWED TO USE IT.UM, I THINK WE'RE PROBABLY FROM SOME OF THE CONSULTANTS THAT WE'VE HIRED AND ARE WORKING WITH, I SAY OUR FIRM'S IN THE TOP 25% IN THE COUNTRY OF HOW WE'RE TRYING TO USE AI, BUT WE'RE NOT IN THE TOP 5%.
WE'RE NOT OUT HERE JUST CUTTING EDGE AND, BUT PUTTING THINGS TOGETHER.
BUT WE'RE TRYING TO DO THINGS MORE EFFECTIVELY, EFFICIENTLY.
AND IF THERE ARE WAYS THAT WE SEE THAT WE DO STUFF THAT CAN BE FUNNELED DOWN, 100% WILL BE SHARING THAT INFORMATION BECAUSE WE WANNA MAKE YOUR ALL'S LIVES EASIER.
'CAUSE IT MAKES OUR LIVES EASIER TOO.
SO IT SOUNDS LIKE WE NEED TO BE SEARCHING OUT OR ASKING FOR WHITE, THE WHITE PAPERS ON PITFALLS AND THINGS LIKE THAT VERSUS THE TRAINING FOR I DON'T THINK, AND THAT'S GOOD.
WHAT WE'VE SEEN AT OTHER LOCALITIES IS THEY'VE STARTED TO PUT POLICIES IN PLACE REGARDING, UM, CAUTION AT THE STAFF LEVEL BECAUSE IF YOU DON'T PUT THE POLICY IN PLACE AND SOMEONE GOES OUT AND DOES SOMETHING, BREAKS CONFIDENTIALITY AND YOU DON'T WANT THEM TO, YOU KNOW, IT'S VERY IMPORTANT TO HAVE THOSE GUARDRAILS IN PLACE.
SO, UM, AT THIS MOMENT IN TIME, IT'S PRETTY MUCH JUST DON'T USE IT IN THIS WAY VERSUS HERE'S A WAY THAT'S VERY HELPFUL THAT WE'VE, WE'VE DISCOVERED, UM, CONFIDENTIALITY IS AN ISSUE.
UM, HALLUCINATIONS AND RELIABILITY OF DATA IS ALSO AN ISSUE.
SO, UM, USE CASES REGARDING HERE'S HOW I CAN WRITE AN ARTICLE WHICH WILL BE MORE UNDERSTANDABLE TO THE CITIZENS, WHICH WE CAN POST ON A BLOG.
THAT MIGHT BE A GOOD USE CASE.
UM, SOMETHING WHERE IT'S RELIANT ON DECISION MAKING AND ANALYZING DATA THAT'S WE'RE SEEING THAT'S LESS RELIABLE AT THE MOMENT.
AND OF COURSE IT'S ALWAYS CHANGING AND ALWAYS GROWING, OKAY.
WHAT NOT TO DO IS JUST AS IMPORTANT AS WHAT TO DO.
SO YOU KNOW, WHAT Y'ALL CAN SHARE IN THAT REGARDS.
UH, ANY OTHER, NOTHING FROM, ANY OTHER QUESTIONS FROM ANYONE IN THE ROOM? OKAY.
UH, THANK YOU ALL VERY, VERY MUCH.
UM, WE WENT PRETTY QUICK ON THAT, CHARLIE, ANYBODY ELSE IN THE ROOM? SO I
UM, I, I SO APPRECIATE, JONATHAN, YOU MIGHT REMEMBER I HAD A COMMANDING OFFICER SAID HE DIDN'T EXPECT, HE INSPECTED AND, AND YOU'VE ADDRESSED SO MANY OF THE THINGS, WHICH IS THE INTERIMS. AND, AND I HATE TO THINK OF US BEING ALMOST, IF YOU KNOW SCHOOLISH WHERE WE'RE ASKING HIM TO DONE YOUR HOMEWORK.
YOU'VE DONE YOUR HOMEWORK, YOU'VE DONE YOUR HOMEWORK.
THE OTHER QUESTION IS, I'M NOT SURE WHAT YOU'RE SEEING SO FAR AS REMOTE WORK AND, AND HOW MUCH OF THIS IS A FUNCTION OF UH, JUST REMOTE WORKING.
I MEAN, WE DON'T HAVE OFFICES AND SUPERVISORS HERE AT THE OFFICE AT THE ADMIN BUILDING, SO WE'RE ALL REMOTE WORKING.
UH, AND, AND THERE IS A DIFFERENCE WHEN YOU'RE THERE WITH COLLEAGUES CAN GO TO THE NEXT OFFICE OR CUBICLE AND ASK A QUESTION.
UH, I DON'T KNOW IF YOU HAVE ANY THOUGHTS ON REMOTE WORKING VERSUS IN-OFFICE WORKING AS TO WHETHER THEY'RE, YOU'RE SEEING ANY KIND OF IMPROVEMENT IN NON COMPRESSION, IF YOU WILL, YOU KNOW, RELIEVING THAT COMPRESSION WHERE, UH, THERE, THERE'S, I'M JUST GONNA CALL 'EM MORE ACCOUNTABILITY AND MORE INTERIM CHECK IN.
I WILL SAY IT'S IMPORTANT TO FIND THE RIGHT BALANCE.
UM, WE HAVE SEEN REMOTE WORK AT A VARIETY OF TYPES OF GOVERNMENT, TYPES OF LOCALITIES.
UM, NOT EVERY JOB CAN BE DONE REMOTELY.
NOT EVERY JOB IS APPROPRIATELY TO BE DONE REMOTELY.
YOU HAVE TO FIND THE RIGHT BLEND.
IT IS IMPORTANT AS A TOOL IN ATTRACTING GOOD TALENT BECAUSE PEOPLE LIKE THAT WORK LIFE FLEXIBILITY.
UM, JUST IN AS AN OBSERVATION, IF WE THINK ABOUT THE COVID YEARS MOVING FORWARD, THE MOST NUMBER OF FINDINGS WE SAW COLLECTIVELY IN OUR CLIENTS WERE THE YEARS IMMEDIATELY AFTER COVID WHEN EVERYONE WENT SO REMOTE, YOU KNOW, FULL, JUST FULL BLOWN REMOTE WITH NO, UM, NO GUARDRAILS IN PLACE.
SO I WOULD SAY PUTTING THE GUARDRAILS AROUND THE REMOTE WORK IS AS IMPORTANT AS ALLOWING THAT FLEXIBILITY FOR STAFF.
AND I DUNNO IF YOU HAVE ANY OTHER, THE OTHER OTHER ADD I THING I'LL ADD TO THAT QUESTION.
UM, WE'VE ALSO NOTICED IN OUR CLIENTS THAT THEY ARE OUTSOURCING A LOT OF THIS YEAR END PREP AND THEY'RE HIRING CONSULTANTS TO COME IN AND HELP WITH THE YEAR END RECONCILIATIONS AND THINGS OF THAT NATURE.
AND THEY'RE HIRING PEOPLE WHO WERE NOT IN THE STATE OF VIRGINIA AND THEY'RE WORKING REMOTELY, BUT THEY UNDERSTAND THEIR JOB AND PROCESS THEIR GRANTED ACCESS.
HOPEFULLY VERY LIMITED ACCESS AS THE AUDITOR IN ME.
HOPEFULLY IT'S A READ ONLY TYPE THING AND THAT, AND, BUT THAT'S HOW THEY'RE SKIRTING AND NOT SKIRTING, BUT USING, TRYING TO GET AROUND THIS ISSUE OF WE HAVE TOO MUCH TO GET DONE.
THERE'S MORE AND MORE GSB PRONOUNCEMENTS, GASB 1 0 1 THIS YEAR, UM, TOOK A LOT OF EFFORT TO COME UP WITH A NUMBER, IN MY OPINION.
IT'S COMPLETELY UNNECESSARY TO DO.
BUT ANYWAY, THAT WASN'T ASKED.
UM, AND IT JUST TOOK EXTRA TIME AND IT TAKES THE EXTRA TIME.
[00:40:01]
OF OUR CLIENTS ARE OUTSOURCING DURING THIS PERIOD TO HELP THEM GET READY FOR THE AUDITS AND TO GET THEIR YEARS CLOSED.UM, MAYBE EVEN OUTSOURCING EACH QUARTER TO HELP WITH RECONCILIATIONS IN REVIEW.
SO, UM, I HAVE A CLIENT THAT WE'VE HAD FOR, I'M NOT SURE HOW MANY YEARS I'VE BEEN THEIR AUDITOR, 10, 12 YEARS, AND THEY'RE SWITCHING AUDIT FIRMS THIS YEAR.
UM, THEY WERE JUST FEELING A LOT OF PRESSURE TO DO THAT AND THEY'RE SWITCHING.
BUT THE DIRECTOR OF FINANCES LITERALLY ALREADY REACHED OUT TO ME AND SAID, BUT WE STILL LOVE YOU GUYS AND HERE'S WHAT I WANT YOU TO HELP ME DO.
AND THEY WANT US TO HELP THEM WRITE THEIR AFTER AND THEY WANT US TO HELP THEM WITH SOME REVIEW WORK AND STUFF LIKE THAT.
SO I'VE LOST THEM ON ONE SIDE AND I'M JUST NOW I'M JUST GONNA BECOME A MANAGER AND I'M GONNA BE INSIDE HELPING 'EM GET READY FOR US.
WHAT I WAS LOOKING AT THE ONLINE DOCUMENT, THERE ARE A COUPLE OF THINGS THAT POPPED UP.
UM, UH, ONE IS, AND THIS IS A PREVIOUS LIFE I WAS ON, UH, THE MONICA CONSERVATION DISTRICT BOARD AND WE HAD POLICIES ON ACCRUED SICK LEAVE AND, AND VACATION.
I DON'T KNOW ON THE COUNTY SIDE WHETHER THERE ARE REQUIREMENTS THAT IF YOU DON'T USE VACATION YOU GET THE BANKING FOREVER AND EVER AND EVER.
UH, I KNOW AT MONICA WE HAD A CAP OF $5,000 IN SICK LEAVE PAYOUT AND THAT WAS AT THE DISCRETION OF THE BOARD.
UM, AND I SAW IN HERE THAT WE HAD AN ADJUSTMENT, I THINK TO UM, I DON'T KNOW IF YOU CALL IT PENSION OR, OR SOME KIND OF OBLIGATED PAYMENTS TO EMPLOYEES IF THEY WERE TO SEPARATE, IS THAT A BOARD DISCRETION OR IS THAT STATE REQUIREMENT? DOES VRS KICK IN? IT'S A BOARD THAT'S A BOARD DISCRETION.
THE, THE HOW MUCH YOU CAN ACCRUE AND VACATION AND SICK LEAVE IS ALL DISCLOSED IN HERE.
I'M SURE HR HAS AN ACTUAL POLICY WRITTEN OUT.
IT'S A LITTLE BIT EASIER TO UNDERSTAND THAN WHAT'S IN THIS DOCUMENT OF, OF HOW MUCH YOU CAN ACCRUE, HOW MUCH YOU CAN CARRY OVER, HOW MUCH YOU WOULD LOSE.
UM, THAT CAN BE CHANGED AT ANY TIME.
IT'S WHAT I I FOR, FOR A VACATION AND THINGS OF THAT NATURE IS DIFFERENT THAN VRS.
I'M SPEAKING NOW OF WHAT WE, I I WOULDN'T SAY, I WOULDN'T SAY THERE IS A FUNDING TO BE HAD.
YOU PAY, YOU PAY IT AS PEOPLE RETIRE YOU, YOU ACCRUE THE LIABILITY.
THAT'S BRS I'M GOING BACK TO THE SICK LEAVE.
SO THE SICK LEAVE, VACATION LEAVE, WE HAVE ACCRUED WHAT WE THINK IS OUR LIABILITY IN THAT POLICY, BUT TECHNICALLY IT WOULD GET PAID OUT OF A CURRENT YEAR BUDGET.
SO IF SOMEBODY WERE TO RETIRE, UM, AND THEY HAD A $30,000 PAYOUT COMING TO, OR $10,000 PAYOUT THAT WOULD GET PAID OUT OF THE CURRENT YEAR'S BUDGET, MONICA, WE CREATED A FUND THAT WE FUNDED THAT WE CALCULATED WHAT THAT IS THAT IS NOT DONE HERE OR ANY LOCALITY THAT I'M AWARE OF.
OH, IS THAT BECAUSE IT WOULD BE A BAD POLICY? I WOULD NOT RECOMMEND FUNDING.
THAT'S, THAT'S, THAT WAS MY QUESTION.
THE OTHER, AND THIS COMES TO THE SCHOOLS WHERE WE FUNDED, I GUESS WE HAVE TO SAY WE, $300,000 WAS GIVEN TO THE, UH, GLAND, WHAT IS IT? EDUCATION FOUNDATION.
AND THAT WAS SHOWN AS AN ADJUSTMENT TO THE SCHOOL'S BUDGET.
BUT THE SCHOOLS HAS ZERO INFLUENCE OVER THAT MONEY.
UH, AND, AND SO MY QUESTION WAS SHOULD IT HAVE BEEN CLASSIFIED AS AN ADJUSTMENT TO THE SCHOOL'S BUDGET OR AS A CONTRIBUTION OR, OR A RELATED AGENCY? UM, 'CAUSE I'D JUST LIKE TO MAKE A COMMENT ON THAT.
IT WASN'T MONEY THAT THE SCHOOLS RECEIVED.
IT, SO IT WASN'T A PART OF OUR OPERATING BUDGET AT ALL.
IT WAS GIVEN TO THE GUCH EDUCATION FOUNDATION AND IT WAS REVENUE RECEIVED BY THAT NONPROFIT.
IT, BUT IT WAS AT LEAST WHAT I WAS READING, WHICH WAS ONLINE QUICKLY.
UH, IT SHOWED IT AS AN ADJUSTMENT TO THE SCHOOL'S BUDGET, WHICH I DON'T KNOW IF YOU HAVE THAT REFERENCE I SHARED WITH YOU OR NOT.
I DID NOT BRING MY, MY LAPTOPS UPSTAIRS BEING UPDATED.
SO I I DON'T HAVE AN ANSWER TO THAT.
I, I JUST DON'T WANT THE SCHOOLS TO BE TOLD THAT THEIR BUDGET ADJUSTED WHEN IT DIDN'T.
'CAUSE THAT'S AN OUTSIDE 5 0 1 C3.
I, I DO AGREE WITH ALL OF THOSE STATEMENTS THAT IT SHOULD NOT HAVE ADJUSTED.
IT WAS MY UNDERSTANDING IT WAS A DIRECT TO THE CHARITY.
NOW IF, AND I WHAT, I DON'T WANNA GET INTO THE DETAILS, I'M WANNA GET PEOPLE IN THIS, BUT IF THE MONEY WENT TO THE CHARITY SO SOMEBODY COULD GET A DEDUCTION AND THEN THAT MONEY WAS GONNA FLOW TO THE SCHOOLS TO BE ABLE TO SPEND ON ITEMS AND PRODUCTS THAT SHE'S SHAKING HER HEAD NO, THEN I WOULD SAY THE SCHOOLS WOULD ADJUST THEIR BUDGET.
WOULD IT FLOWED TO THEM? BUT IF THAT'S NOT THE PURPOSE, THEN I, I AGREE.
I CAN'T REMEMBER THE PAGE WITHOUT HAVING A CHANCE TO LOOK INTO ALL THE DETAILS.
YEAH, NO, I MEAN, MONEY WAS SPECIFICALLY FOR THEM TO RUN A PROGRAM IN OUR SCHOOLS FOR AFTERSCHOOL ENRICHMENT PROGRAMS, BUT NONE OF THAT MONEY CAME UNDER OUR CONTROL AT ALL.
AND THEY'RE ACTUALLY CHARGING FEES FOR THEIR SERVICES.
AND THAT'S INDEPENDENT OF THE SCHOOL BUDGET AS WELL.
THAT'S THEIR OWN ACCOUNTING, OWN ACCOUNTS AND SO FORTH FOR
[00:45:01]
THAT.I UNDERSTAND YOU ALL DIDN'T ADJUST YOUR BUDGET, YOU HAD MONEY, CORRECT? YES, SIR.
SO, AND THEN DEPRECIATION, YOU SAID OUTSIDE EXPERTS 'CAUSE SOFTWARE AS A SERVICE AND YOU GOT TWO YEARS, THREE YEARS AND SCHOOL BUSES ARE 15 YEARS AND ALL OF THAT IS SOMEBODY'S SETTING THOSE DEPRECIATION SCHEDULES.
THE, UM, SOFTWARE CALCULATES THE ACTUAL MANUAL CALCULATION OF THE DEPRECIATION.
THE PART THAT'S THE ESTIMATE IS THE USEFUL LIFE.
UM, BECAUSE WE DON'T KNOW IN ADVANCE EXACTLY HOW LONG AN ASSET'S GOING TO LAST, BUT WE'RE FOLLOWING INDUSTRY STANDARDS.
I HOPE, YOU KNOW, IF WE, IF A SCHOOL BUS LIFE IS 15 YEARS, LET'S SAY, SINCE THAT WAS YOUR EXAMPLE, BUT WE HAVE A LOCALITY THAT REPLACES THEIR SCHOOL BUSES EVERY 10 YEARS, THEN I WOULD SAY THAT THE LIFE OF THE BUS ISN'T 15 WOULD BE 10 BASED ON WHAT THEY DO.
ANY OTHER COMMENTS FROM COMMENTS? OKAY.
UH, WE'LL MOVE ON TO, AND THANK YOU AGAIN.
WE'LL MOVE ON TO OTHER BUSINESS.
YEAH, MR. CHAIRMAN, I JUST, DAVE WAS REF REFERENCED EARLIER IN THE CONVERSATION, BUT I DO WANNA PUBLICLY INTRODUCE DAVE WILSON, WHO IS OUR INTERIM DIRECTOR OF FINANCE.
DAVE COMES TO US WITH A BACKGROUND, BOTH PRIVATE FINANCE AND MUNICIPAL GOVERNMENT FINANCE AND, UH, THANKFUL THAT HE HAS JUMPED RIGHT IN, UH, AS HE HAS HELPED US GET THIS AUDIT ACROSS THE FINISH LINE AND HAS ALREADY, UH, OPENED MY EYES TO MULTIPLE THINGS AND SO GRATEFUL FOR HIS WILLINGNESS TO SERVE IN THIS BRIDGE ROLE AS WE RECRUIT FOR THE, UH, DIRECTOR OF FINANCE FULL TERM.
SO REALLY THANKFUL WITH DAVE'S HERE.
UH, WE'LL MOVE ON TO PUBLIC COMMENT.
ANY COMMENTS FROM THE CROWD? OKAY.
WELL, WITH THAT, DO I HAVE A MOTION TO ADJOURN? LET ME, UH, JUST SAY JUST OF ALL DOES I, I APPRECIATE THE MANNER IN WHICH YOU HAVE BEEN ON TOP OF THIS.
OBVIOUSLY, I, I DIDN'T REALIZE YOU WERE MEETING WITH DR.
RAIL AND THE STAFF AND SO FORTH AND, AND, AND SO THE COMMENTS YOU MADE INITIALLY ME ARE MUCH MORE MEANINGFUL TO ME KNOWING THAT, YOU KNOW, YOU ACTUALLY GOT INTO THE WEEDS A LITTLE BIT AND SO FORTH.
IT'S BEEN SHARING WITH THE HONOR COMMITTEE AND, AND TAKING THAT ON AND DONE A GOOD JOB.
AND IT WAS GOOD TO, TO THAT POINT.
IT WAS THE, THE FIRST THING THAT COMES TO MIND IS ENSURING NO FRAUD, NO, YOU KNOW, UH, NO ALLOCATION, NO MISALLOCATION OF FUNDS, MAKING SURE WE'RE GOOD TO THE BEST STEWARDS WE CAN BE.
AND THEN THE SECOND WAS, ARE OUR POLICIES, IS OUR GOVERNANCE APPROPRIATE? EXACTLY.
AND SO THOSE TWO QUESTIONS GOT ANSWERED VERY QUICKLY AND THEN IT MOVES ON TO HOW DO WE ENSURE IT DOESN'T HAPPEN AGAIN.
RAIL AND DAVE NOW ARE THE CAPABLE HANDS WE NEED, UH, TO, TO ENSURE WE'RE ON THE RIGHT PATH MOVING FORWARD.
DO I HAVE A MOTION TO ADJOURN? SECOND.
SECOND WITH THAT? UM, OH, DO I NEED TO ALL WITH THAT? WE'LL, ADJOURN.