Finance director says vendor reconciliations were inaccurate; commission pauses use of recommended financial services

Tucumcari — Finance Director Deborah Grant told the City Commission on March 27 that a contracted accounting firm’s reconciliations for fiscal year 2023 were not fully accurate, producing unexplained cash variances and forcing staff to rework the audit and reconciliations.

Grant said staff began an audit of fiscal year 2023 and discovered bank items that the contractor had marked cleared though checks had not cleared, and a deposit that was posted three times over seven months. “The reconciliations that were done by that agency were not a 100% accurate,” Grant said. She said she has started the FY‑23 audit with outside auditors, is re‑reconciling the work the contractor performed, and is drafting a letter to the firm to notify them that the city will no longer need their assistance.

Why it matters: inaccurate reconciliations delayed completion of the FY‑23 audit and complicated the city’s effort to resolve a cash variance that will affect the budget calendar. Commission members pressed staff for timing; one asked whether the auditors and contractor were aware of the findings. Grant said the contractor has not yet been told of the specific findings and that she is preparing formal notice.

Details from the meeting: Grant described journal entries that may have been posted rather than batched or routed to the appropriate funds, explaining why bank balances did not match internal ledgers. She said the erroneous postings and duplicate deposits explain at least some of the variance and require staff to “go back further” to re‑reconcile the FY‑23 year. The commission was told that starting the budget work in April remained the plan but that accurate reconciliations were a prerequisite for completing the audit.

Separately, the commission reviewed proposals for professional financial services. After a committee review, commissioners were advised that one proposal was nonresponsive and the remaining responsive proposal had unresolved issues. The commission voted to accept the reviewing committee’s recommendation to review other options and not move forward with that directive at this time. The motion passed on roll call.

What’s next: Grant said she will notify the contracted accounting firm in writing of the city’s findings and that outside auditors are continuing the FY‑23 audit. The commission directed staff to bring additional options for professional financial‑services assistance back to the commission for review.