This clip from the 9.13.21 Board Of Supervisors Meeting Shows the presentation by Chris Herr from Maillie CPA firm.
They did our audit for 2020. This is what I would call the "happy" presentation or the "everything is beautiful" Audit.
1. The audit was completed in July, July 8th to be exact and if you listen carefully you will hear the auditor say so. I did not know this at the time, how could I, no one in the public as of that time had access to the audit report. Now we know the audit was complete and signed off by Maillie on July 8th. Our supervisors should have made this available to us almost immediately but they did not. Waited until September 20th to post on the Township website.
2. The audit is required to be completed before April 1 following the completed prior year. Don't listen to the excuses, you will hear Chris Herr say many of his clients still have not completed their audit with him. Let me say this, I have worked for very large corporations with thousands if not millions of transactions and they completed the audit in 90 days or less. There is really no excuse not to meet the government requirement.
3. Presented the overfunded Pension Plans as a positive aspect of the government activities. But is it? What they did was prematurely move about $10 million of taxpayer money into Pension funds that were adequately funded. Exposing these monies to extreme market risk but also depriving our local government the income generated by $10 million in our bank accounts. Secured money rates are low, 1 to 1.5 interest rate but we woulds have made at least $150,000 to our accounts and rest easy at night that we had zero market risk.
4. Spent about $1 million on Equipment and vehicles in 2020
5. RCC assets reported at $14.7 million with $400,000 in depreciation and mentioned no additional increase in depreciation. This seems odd since we know they approved and purchase some large items for the Golf Course, where are these items depreciated?
6. They present the fact the RCC revenue increase from $645k in 2019 to $870k in 2020 but make no mention of the corresponding losses of $1.6 million in 2019 and the 2020 loss of $390k. Loss improved but its sill a significant loss.The loss only improved because the legal expenses went away and the expenses dropped from $2.2 million in 2019 to $1.2 million in 2020. All legal expenses. A million $ in legal expenses?
7. No mention of the Capital injection of $2.8 million of Taxpayer funds transferred to the RCC. Thats right, wasn't made know nor was it obvious and it was slipped by all of us.
8. Not a mention nor could I find an analysis of the $2 million accounts receivable that had been presented at previous Board meetings. We know that about $1.6 million may be the sewer accounts, what is the almost additional $400,000 receivables, taxes? Is this net of uncollectible? Where is the aging of A/R? except buried in management notes they mention General Fund Revenue was down $900k for 2020 noting the township was relying on sewer account A/R which seems really odd that this would be a budgeted revenue item. I don't think it was, this was thrown in for confusion. the way its present they say they anticipated collecting $1.2 million of sewer collectables but only collect $625k. Still this would have meant a A/R outstanding of $1.8 million and the last time they presented the outstanding sewer A/R was $1.6 million. Much of this is very old A/R and most if not all should be viewed as uncollectible because much of it is many years old. This is a serious issue the Auditor missed!!
9. As mentioned General Fund Revenue came in $900k less than expected and the went over the budget by $430,000. Now listen to this, they claim they under-budgeted for recycle collection program but this is total nonsense. They went out for bids and accepted the bid and knew what the cost would be. What they really did was to switch midstream from collection twice a month to every week. They blew out the budget and we must hold them accountable.
10. They failed to adequately adjust the budget or the millage to meet spending requirements. They utilized the reserves (sewer fund proceeds) to supplement the budget. Not the best way to run our government. It will come home to roost but when they are long gone.
Overall it seems the independent auditor was not independent. I've never seen a presentation like this one, no negatives, they certainly danced around the RCC loss and the $2.8 million cash injection of taxpayer funds into the RCC. The over budget spending .....you did not hear any of that in the presentation.