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BDD auditor reports single significant deficiency tied to partner billings and restatement
Summary
An external auditor told the Buckman Direct Diversion Board that a repeat, significant deficiency in the programof reconciling partner billings led to a restatement of the FY24 financial statements; staff and a consultant firm said they have moved to address the process and will distribute the full audit report to the board.
An external auditor told the Buckman Direct Diversion Board on May 1 that a single, repeat finding classified as a "significant deficiency" in the board's internal controls was tied to inconsistent reconciliation of partner billings and required a restatement of the FY24 financial statements.
The auditor said the issue stemmed from turnover and the absence of a consistent finance staff member to perform periodic reconciliations with BDD partners. The auditor noted the restatement and said all audit materials are publicly available on the state auditor's website.
The finding was characterized as a significant deficiency rather than a material weakness, meaning the auditor judged it did not, by itself, result in a material misstatement of the financial statements but could increase the risk of one in combination with other factors. The presenter said the issue was a repeat finding from FY23.
Board members asked for the full audit report and management responses. Staff said paper copies had been mailed and that an electronic copy would be distributed; the board agreed the audit should be attached to the meeting packet and also included in the next packet so members and the public can review the full text.
Kurt, a BDD finance staff speaker, said the authority had offered a position to an applicant and that CLA (a consultant firm) has assisted in catching up billing work and providing continuity. A CLA consultant who spoke said he trained an accounting supervisor and continued monthly billing when that supervisor left, and that February billings were completed while March billing was nearly complete.
The auditor briefed the board on recent Governmental Accounting Standards Board (GASB) changes that affected disclosure and prior-period error reporting (GASB Statement 100) and noted future GASB statements (mentioned as 101, 102, and later 103/104) that may affect BDD reporting in coming years. The auditor also recommended ongoing attention to IT and cybersecurity risks.
Board members pressed for a clear summary page in the presentation that spells out the single finding and management response; the auditor and staff agreed to provide the full audit report electronically as soon as possible and to include it in meeting materials so the governing body can review and raise any comments at the next meeting.
The board did not take a formal vote on policy changes at the meeting; the actions agreed were distribution of the audit report to the board and inclusion of the report in meeting packets for transparency and later discussion.
