News Analysis
The Vero Beach City Council missed a major opportunity to rebuild trust with the tax-paying public last week when it failed to act on a proposal by Councilman John Carroll that it publicly vet the city’s 10-month late audit at a council meeting.
Finance staff and auditors completed the fiscal year 2022-23 audited financial statements in early May to halt state enforcement actions against Vero. But because of pressure to avoid further forfeiture of state funds, Finance Director Lisa Burnham submitted the reports to the Florida Auditor General before the city council could review and accept the audit findings.
Having the lead auditor or a partner in the outside accounting firm present the audit to the city council was a standard practice followed until recent years when it ceased, with no real explanation. Auditors for the County Commission, the Town of Indian River Shores and the Hospital District all present those entities’ annual audit findings to the elected officials in public.
But auditors from the firm Cherry Bekaert have not come before the Vero City Council this spring to answer questions, including a key one posed by council members in February: Why didn’t they alert the city council, or at least alert City Manager Monte Falls, about big problems in the Vero finance department?
Auditors found significant deficiencies in the city’s internal accounting controls, meaning staff did not have essential checks and balances in place for city funds and bank accounts. And Carroll said he wanted to get a better explanation of the problems in public, and to make sure fixes get done.
“I still want to see that audit presented by Cherry Bekaert, so that we can make an actionable motion on the recommendations,” Carroll said.
This seemed to many like a perfectly reasonable request. But Mayor John Cotugno, distressed by bad press the city has earned from the audit debacle, urged the council to move on.
“The 2022-23 one is done. It’s been submitted and accepted by the Joint Legislative Auditing Committee,” Cotugno said.
Carroll pressed the issue, at one point even telling the mayor to “step back!”
“I disagree. I think it’s important for transparency that we as a body accept the audit and the corrections therein so that the city manager can direct the staff to make the corrections that are outlined in on page 112 and 113 of the audit.”
Vice Mayor Linda Moore suggested the 2022-23 audit presentation be placed on the next agenda.
“Whenever Cherry Bekaert can make the presentation,” Carroll said.
But Cotugno protested, asserting that asking auditors from a firm with 2,500 employees to make a short public presentation to the City Council would cripple their efforts to help compile the city’s budget and complete the next Vero audit. He kept insisting that presenting the 2022-23 audit and completing other duties could not both be accomplished.
“We cannot just continue to overload that department when they’re in a critical path now,” Cotugno said.
“We’ve got Cherry Bekaert here under crunch time to get the audit done, the current audit. How much time do you want them to take out to put a presentation together to come in to give a presentation to city council when they can be helping Lisa and her team get the current audit done?” Cotugno said.
After Councilman Aaron Vos said he had personally reviewed the audit and met with Finance Commission Chair Bob Jones and with staff to go through it, he asked that a summary of audit findings and the corrective actions taken and underway be sent out and Falls agreed to have that done.
After city staff was directed to provide the audit findings and corrective actions to the council in writing, Carroll did not persist with a formal motion for a public audit presentation when it was clear he did not have to support to get it.
Falls also assured the council at the June 10th meeting that the finance department is now fully staffed.
“Javier Gonzalez has rejoined the city. He worked with us about 12 years ago as our assistant director. And Kathy Taube, who was a city employee in the finance department … (and) moved to risk management, has gone back to finance as a comptroller,” Falls said.
But he also told the council that the 2023-24 audit, which he previously had promised would be completed on time, will now be filed up to three months late.
“The 2023-24 audit is due June the 30th. It’s a physical impossibility to have it done by that date,” Falls said.
