UPDATE: Caledonia Committee To Discuss Audit Of Village Finances

UPDATE: The Finance Committee will discuss the financial audit letter at a meeting set for 5:30 p.m. Aug. 30 at the East Side Community Center, 6156 Douglas Ave.

Tom Lebak, the village administrator for Caledonia, elaborated further on the Management Audit Letter that was delivered to the Finance Committee on Aug. 9.

Lebak stressed that the audit letter offered guidelines and suggested management tips, and that if improvements are made, the village’s financial picture would be better represented.

“We just need to go through each of the recommendations and work with the Finance Committee,” Lebak said.

Representatives from Clifton Gunderson LLP briefed the Finance Committee Tuesday on what it found to be material weaknesses and significant deficiencies. The auditing firm revealed inconsistent bookkeeping for various Village projects over the last several years. Auditors also told the village that the way some municipal services are funded should probably be reexamined in the near future.

The Finance Committee later approved a recommendation to invite the representatives from Clifton Gunderson to present their findings to the full Village Board at the Sept. 6 meeting.

While the Board is required to accept the recommendations of the auditors, it also can make comments about the findings. Lebak said the process would prove to be helpful.

“Hopefully some things that come out of it may improve efficiencies,” Lebak said. “If we can make certain changes, the auditors could do less work on site, which would save money.”

The goal of the audit process is to ensure there are safeguards against fraud and the misrepresentation of numbers.

Lebak also praised the audit firm, with whom the Village is working for the first time.

“I think this company brought some new perspective,” Lebak said. “The things they want to highlight might have been a little different, but we will take their recommendations and try and implement them.”

Some of those recommendations may be expensive, like streamlining the Village’s municipal accounting software while others, like reducing the number of bank and investment accounts the Village operates, can be done fairly quickly. Still others, like an idea to make the Village’s utilities responsible for their own accounting and ledger functions, have to be considered by the Board. Currently, Finance Director Larry Borchert handles those duties, Lebak said, adding that those could be done in-house or by a vendor.

“The key, of course, is that the management letter really is a guideline,” Lebak said. “Some of the recommendations are weaknesses that we need to be concerned about. It’s a warning, so to speak, but we always take this as a tool, not an indictment.”