LAS CRUCES – The city received a clean bill of exchange for the second consecutive year, with outside auditors finding nothing new of significant importance.
At a Las Cruces City Council meeting on Jan. 18, officials were presented with highlights of the city’s annual comprehensive financial report by certified public accounting firm Pattillo, Brown & Hill, LLP
Last year, PBH gave the city top marks for its annual financial statements. The external auditing firm gave the same grade to the city for that audit, which covers the fiscal year ended June 30, 2021.
“This is exactly the kind of report the city wants to get,” said PBH CPA Chris Garner. “And it’s basically the highest level of assurance that we as auditors can give.”
Last year’s audit also gave the city the highest possible score for compliance with the use of federal dollars, and the city received the same rating this year.
PBH encountered a minor finding in the past fiscal year and the finding did not rise to a major weakness level, the highest possible risk level for a finding, or a major deficiency, the second highest level.
The company found that one of 25 employees tested was missing a properly notarized federal Form I-9 in their personnel file, a form employers are required to fill out for all new hires. According to the audit report, the city’s human resources department is “developing a recurring plan and standard operating procedures have been drafted” that will be implemented to review all I-9 forms for compliance by next month.
Las Cruces human resources director Jo Richards told councilors the issue had been resolved.
During the past year, PBH identified two findings in the area of internal control over financial reporting and compliance, both of which were rated at the lowest severity level. Last year’s audit also found that the most serious non-compliance issues from the previous report, which were later confirmed by Visit Las Cruces’ McHard audit report, had been resolved.
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The two internal control and compliance issues PBH identified last year were the city’s billing department’s improper treatment of cash receipts and the city’s unlawful payment of Doña Ana County to house inmates used by the Las Cruces Police Department arrested and charged with misdemeanor.
None of these findings reached the level of material weakness or significant deficiency. Nonetheless, the audit for FY21 found that both findings were remedied.
The city auditor told the council that the original $409,000 the district owed the city for improper payment had dropped to $188,000 over eight months. In the future, bills for prisoner care will be deducted from bills sent by the city to the county. City manager Ifo Pili said the county has approved the agreement and will complete the city.
Garner said an important consideration for the council is that the results don’t “stick” for multiple years.
“Exceptions will happen. You will have insights,” Garner said. “But what you really want to see as advice is, ‘Is management looking at these issues?'”
The city council voted 6-0 on Tuesday to accept the test report. Mayor Ken Miyagishima was not present at the meeting.
Michael McDevitt is a city and county government reporter for Sun News. He can be reached at 575-202-3205, [email protected], or @MikeMcDTweets on Twitter.
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