Consultant urges monthly financial monitoring, staffing continuity as 2023 audit waits on capital-asset records

A finance consultant told the Cleveland Heights Finance Committee on April 2 that stronger, regular monitoring and improved staffing are needed to prevent future reporting delays and to support the city’s budget process.

Frank Ike, a finance consultant working with the city during the first quarter of 2025, told the committee the city’s external auditor, Schonhardt, cannot complete the 2023 audit work until the city delivers a final capital-asset inventory. Director Hairston said the city’s capital-asset list “will be complete this week,” and staff member Mr. Phelps gave a firm deadline of “Friday close of business” for finishing that inventory. At the same meeting Director Hairston said the 2024 audit “will be delayed.”

Ike told the committee that council’s oversight role requires both clear budgeting up front and regular follow-up after the budget is adopted. He recommended a set of recurring financial reports: routine budget-variance analysis, periodic trend reports comparing several years of revenues (property and income taxes were cited as examples), and monthly cash and reconciliation reports. He said those reports would help the council spot emerging problems early and reduce the risk of unreconciled differences building across months.

Ike described staffing and systems as two related causes of the current operational strain. He praised existing staff support but said the city should consider hiring an assistant finance director or equivalent to provide continuity and day-to-day capacity. He also recommended evaluating the current accounting system and, if a transition to a new system is not imminent, providing additional training on the present system so staff can produce the reports the finance committee needs.

On reconciliation cadence, Ike said more frequent reconciliations (weekly or daily in other jurisdictions he has seen) make it easier to catch mistakes; where daily is not feasible, a formal monthly timeline and thresholds for acceptable reconciling items were suggested.

Committee members and the mayor discussed near-term steps. Director Hairston said the department is recruiting and building capacity and asked council to be mindful of current staffing limits when requesting new or ad-hoc reports. The mayor and committee members agreed to work on a reporting format and monthly cadence; committee members asked for January–March financial statements to be made available before the committee’s April 28 meeting.

While there was broad support for Ike’s recommendations, members flagged implementation constraints: the finance department’s current staffing levels, competing capital projects, and the practical lead time for an accounting-system conversion. Several council members pressed for clarity on which reports the finance committee should expect, and city staff committed to developing a proposed schedule and formats for monthly monitoring.

The consultant offered to review draft reports and provide future recommendations. Director Hairston and committee leadership said they would use Ike’s recommendations as a template while accounting for the department’s present capacity.

Ending: Committee members scheduled follow-up work: (1) completion of the capital-asset inventory this week, (2) production of recent monthly financial statements for review before the April 28 meeting, and (3) a collaborative draft of monthly reporting formats to bring back to the finance committee for discussion.