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Seabrook council debates scope of outside audit; staff says forensic audit not requested
Summary
Councilmembers discussed language on an agenda item labeled 'forensic audit' and staff clarified the city is undergoing its regular external audit and will issue an RFP for future auditors; no forensic audit was requested or approved at the meeting.
The Seabrook City Council spent substantial time on April 1 clarifying whether the agenda item requesting an audit of city finances sought an outside independent audit or a forensic audit. Councilmember Joe McCall said he requested an outside independent audit, not a forensic probe; staff and other council members described the difference.
A staff speaker explained that an outside independent audit is the city’s standard annual financial audit, noting the current engagement with an external firm (referred to in the meeting as CRO) and that the city’s comprehensive annual financial report is audited each year. “Forensic is when you know something and then you want to dig super deep into that,” the staff member said, describing forensic work as more invasive and scoped to investigate suspected wrongdoing.
Councilmembers discussed past practice, including a 2011 council decision to stop rotating auditors every three to five years; one councilmember said some CPAs advise rotating firms but research presented in 2011 showed changing firms frequently can miss fraud. The staff member said the city will put out a request for proposals for auditing services before the end of the fiscal year and that the ongoing external audit engagement will continue. “We are going to go out for bid,” the staff member said, and councilmembers said the next council will review proposals and decide whether to retain the same firm or hire a different one.
Why it matters: The conversation centered on oversight and public confidence in the city’s financial controls. Councilmembers cited specific concerns raised by residents about how certain expenditures were recorded — for example, a $2,000 donation tied to the Christmas Boat Parade and retirement payments recorded to the water budget — and asked staff to follow up with adjustments or clarifications if needed.
No motion to order a forensic audit was made or voted on during the meeting. Council direction recorded on the record was that staff will prepare an RFP for audit services to be considered by the next council and staff will look into the specific line items questioned by councilmembers.
