Audit committee accepts payroll-processing review; auditors find control gaps but no calculation errors
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Summary
Carson City’s Audit Committee on a unanimous vote accepted a payroll-processing review by Eide Bailly LLP that found two control weaknesses — limited written policies and inconsistent pay-code guidance — but identified no calculation errors in a sampled review.
Carson City Audit Committee members voted unanimously to accept a payroll-processing assessment prepared by Eide Bailly LLP, which concluded that the city’s payroll calculations were accurate in the sample tested but identified gaps in written policies and pay-code documentation.
The auditors, presented by Kathy Villamar of Eide Bailly, said the engagement reviewed payroll activity from Jan. 1, 2024, through Dec. 5, 2024. “We found no exceptions or discrepancies in the payroll calculations performed by the city,” Villamar told the committee. The report nonetheless identified two findings: limited detail in the bureau’s payroll policies and an absence of formal guidance for pay-code usage.
The report recommended expanding payroll policies to include detailed guidance on timekeeping, approvals, reconciliations, fraud prevention and clearly defined roles and responsibilities; documenting a formal payroll timeline that lists deadlines for timesheet submission, approvals and processing; and producing formalized guidance and periodic reviews for pay-code usage. Villamar also recommended considering system configurations to restrict inappropriate code usage.
Sherry, who presented the item for the city, said departments currently rely on training and system controls to limit improper code usage. “We have like 300 pay codes in the system,” Sherry said, noting the complexity created by multiple collective bargaining agreements and employment resolutions. City staff told the committee that some timesheet rules are enforced by the timesheet system and that departments perform targeted training for reviewers.
Committee members asked about next steps and the city’s plan to implement the recommendations. Management told the committee it agreed with the recommendations and will formalize policies, document timelines and pursue system and training changes to improve consistency and accountability.
Action: A motion to accept the payroll-processing review was made, seconded and approved unanimously.
The committee’s formal acceptance closes this agenda item; the report’s recommendations remain for management implementation and follow-up.