Buncombe County commissioners will decide whether to commit to a forensic audit of county finances on Tuesday, Sept. 4, a decision that comes as the county faces scrutiny following charges of embezzlement and corruption against former county officials.
“A forensic audit can identify issues that may not be addressed in the federal criminal investigation but are critical to Buncombe County from an organizational standpoint, such as organizational systems, controls and culture,” the proposed ordinance to authorize the audit reads.
The ordinance charges the Buncombe County Audit Committee with making recommendations for the scope and focus of the audit upon completion of the federal corruption investigation and the current year’s audit. The board also recommends that the county use a firm “that has no previous or existing contracts with the county for auditing procedures.”
Larry Harris, the chair of the audit committee, told commissioners on Aug. 21 that the board would have more freedom to determine the scope of a forensic audit than a standard external audit. A forensic audit, for example, can extend beyond a single year, he said.
“In engaging a firm to do a forensic audit, you need to have very clear perceptions and an understanding of what you want done,” Harris said.
Waiting until the federal investigation is complete would help the county define the parameters of the forensic audit, commissioners said, as well as allow the county to incorporate any new information revealed through additional indictments.
“It’s like you’re waiting for the results from a doctor,” said Commissioner Jasmine Beach-Ferrara during the meeting. “You’re waiting for an MRI and an ultrasound and other diagnostics, and you can’t do the full treatment until you know the full diagnosis.”
Representatives from the county’s external auditors, CliftonLarsenAllen, told members of the county audit committee earlier this month that starting a forensic audit now would also delay completion of the Fiscal Year 2018 external audit. A forensic audit, CLA said, could produce additional data that the firm would need to evaluate as part of its audit.
Commissioner Mike Fryar said at the meeting on Aug. 21 that he supports a forensic audit but that the board should wait until the end of the federal investigation before making a definitive commitment.
“We say we’re going to do all this stuff today,” Fryar said, “but do you know who pays for that? Everybody in this room.”
Fryar advocated making a decision on the forensic audit only after the federal investigation is complete and the accused have entered the court system — something he admitted could take a while. “It probably won’t be this year, probably won’t be next year if you want the truth,” Fryar said. “But when it’s done we can come back as a board and make a decision on this.”
The Board of Commissioners voted in June to withhold in contingency about $1.86 million of the proposed $3.2 million combined funding increase for the Asheville City and Buncombe County school systems.
At the time, the board said it would require the systems to make a formal request and presentation to the board to receive all or part of those contingent funds.
After meeting with representatives from the system on Aug. 28, interim County Manager George Wood recommended that the board give the school systems that money, allocating about $1.57 million to Buncombe County Schools and about $300,000 to Asheville City Schools, based on the proportion of total students in the two systems.
According to a letter written by school officials to the county, Buncombe County Schools initially requested about $3.2 million, a figure the county reduced by about $520,000 to keep the county’s fund balance at its required threshold.
Officials said in the letter they will use the money to meet costs associated with salary and matching benefit increases and well as utility rate increases. The state’s final budget calls for school systems to pay an 18.86 percent matching retirement contribution (which is higher than last year’s 17.13 percent requirement) and a 6.5 percent increase in pay for school teachers.
In other business
Commissioners will discuss on second reading the personnel changes voted on at the board’s Aug. 21 meeting. You can read more about those changes here.
The Buncombe County Board of Commissioners will meet at 5 p.m. Tuesday, Sept. 4, in the third floor conference room at 200 College St. The full agenda and supplementary materials are here.