Fort Thomas finance committee: $322,498 audit adjustment reflects posting errors, auditors say no evidence of fraud

FORT THOMAS, Ky. — The Fort Thomas Finance Committee spent much of its Nov. 5 meeting reviewing the city—s FY 2023-24 audit and an associated $322,498 prior-period adjustment that auditors described as a reconciliation and posting problem rather than missing funds.

John Chamberlain, the audit manager leading the engagement, told the committee that "unaccounted for" is an accounting term used to justify a prior-period adjustment in the management letter and does not mean cash is missing. "I've done enough fraud that I know there's no fraud here," Chamberlain said, adding that the problem appeared to be "sloppy accounting" arising from missed postings and reconciliation gaps.

The audit team described specific categories of missed or incorrectly posted items that together produced the variance: school transfers that were not posted, payroll deferred-comp…