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Brookshire finance staff report $1.5 million transfers, auditors cite missing reconciliations
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Summary
City finance staff reported transfers between Wells Fargo and NewFirst accounts in 2024 and ongoing gaps in reconciliations that are delaying completion of the 2022–2024 audits; council was advised to leave accounts open pending audit work.
City finance staff told the Brookshire City Council on June 5 that $1.5 million in transfers among city accounts were identifiable but that accounting gaps and the city—s migration between accounting systems have delayed audits for multiple years.
Miss Lyons, who presented the financial report, said that in January 2024 funds from 13 Wells Fargo accounts were transferred into the general fund at Wells Fargo totaling $1,500,000 and that not all balances had been moved to NewFirst as previously thought. She said approximately $200,000 remained in Wells Fargo and roughly $871,000 had been used to pay city bills without being allocated to the intended tax accounts at NewFirst.
The city—s audit status was raised later in the meeting. Miss Lyons and other staff said that missing bank reconciliations and the city—s change of accounting software in 2022 have left standard year-end worksheets incomplete: accounts receivable roll-forwards, capital asset schedules, AP aging, deferred revenues and compensated absences were among the items listed. Staff said they are working with Tyler Technologies and outside vendors to extract historical data so the fiscal 2022 audit can be completed and to allow auditors to proceed on 2023 and 2024.
Council members were advised not to move or close accounts while auditors continue their work; Miss Lyons recommended keeping funds in place until the council decides on any bank consolidation. No formal motion to close accounts was made; staff said they will return with recommendations after the audit work progresses.
The council did vote earlier in the meeting to approve regular financial items, including monthly bills and disbursements, and to accept the financial report as presented.
Council discussion noted NewFirst—s varying responsiveness and that audit completion is necessary before making permanent banking decisions. Staff said a full accounting reallocation would follow council direction once audits conclude.
