Audit committee: county's tax system can't close a year; process fixes, staffing recommended

Davis County's Internal Audit Committee warned March 5 that longstanding limits in the county's financial software and related processes prevent the county from closing a fiscal year properly, creating reconciliation gaps and long-held prepayments that complicate accurate accounting.

The controller, Curtis Pope, told the committee the problem is structural: "We have never had a system that you can close a year," he said, describing an environment in which prior-year errors roll forward and year-end plug entries obscure whether balances are current or historical. The county is reviewing a software package (referred to in committee materials as Cortex/Quartax) and aiming for an August update on how the system can meet required reconciliations.

Why it matters: without reliable year-end closes, county officials cannot accurately determine which transactions belong to the current year or earlier ones. That undermines internal controls, complicates distribution of interest and tax receipts to other taxing entities, and increases the risk that errors will go undetected.

Committee members and staff outlined several practical pressure points. The treasurer's office said fewer than 2,000 taxpayers use the county-run ACH debit program and roughly 900 payments are scheduled for the 5th of each month, but even those relatively small recurring-payment populations add complexity the system must track. Members also discussed "parked" prepayments and escrowed balances, some of which have remained on the books for years, and whom interest from those balances should be credited to.

IT director Jeff Hassett framed the issue as a match between process and system: "The program was built off of processes. As we modify those processes, that's when we have to look at the program to see what would need to be done to match potentially the changes in process." The committee discussed interim steps, including manual reconciliation options or temporary staff to perform reconciliations if systems cannot be upgraded in time for an August deadline.

The committee also noted prior budget action that funded at least one higher-level full-time position in the treasurer's office (and possibly a second) to help manage peak workload and reconciliation needs after the treasurer's office assumed additional payment responsibilities for the assessor.

Next steps: staff will continue evaluating system capabilities and processes, with a work session planned to address small-balance discrepancies and a fuller update expected by the August meeting. The committee approved minutes from the Feb. 24 meeting and kept action items on follow-up schedules.