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Independent audit finds accounting inconsistencies at Recreation & Parks; no fraud identified
Summary
An independent audit of Augusta Recreation & Parks found outdated policies, inconsistent ledger coding, missing supporting documentation and small cash variances in event revenue; auditors said they found no evidence of fraud but recommended immediate policy, IT and reconciliation fixes.
An executive‑summary audit of the Augusta Recreation & Parks Department presented Feb. 3 identified a series of internal‑control and recordkeeping weaknesses, though auditors said they found no indications of criminal fraud.
UHY Advisors’ managing director Jack Reagan told commissioners the firm reviewed more than 20,000 transactions covering 2021–2023 and "did not find anything that we overtly believed were fraudulent transactions." The audit team identified stale policies — the department’s policy manual had not been revised since Jan. 11, 2012 — and widespread inconsistencies in how transactions were recorded between the department’s ActiveNet system and the city’s general ledger (Central Square).
Key findings and figures: UHY reported $32,445,619 in Recreation & Parks expenditures for the audit period; excluding personnel categories, that totaled $16,248,696 in non‑payroll expenditures. Using ActiveNet keyword analysis, auditors identified $6,691,112 in community center revenues over three years, with weddings ($612,000), birthdays ($564,000) and aquatics ($448,000) as the top categories. The audit also flagged travel spending recorded to inappropriate general‑ledger accounts (auditors cited about $84,731 in higher‑end hotel stays by the prior parks director), and bank‑deposit variances for the Candlelight Jazz series (2021: $6,201; 2022: $6,739; 2023: $17,293 fewer bank deposits than revenues recorded).
Auditors’ assessment and recommendations: Reyna Hernandez, UHY senior manager, said the root cause of many issues is outdated policies and gaps between written procedures and actual practice. She recommended updating policies and procedures, tightening reconciliation processes (especially for cash events), establishing a parks vendor and contract registry, clarifying delegated approval thresholds for purchases and leveraging existing financial‑IT capabilities to reduce manual errors. Reagan suggested a corrective‑action plan with named owners and target dates and advised management follow‑up at six‑to‑nine months.
Administration and departmental response: Recreation & Parks leadership acknowledged many findings and said staff have begun internal policy reviews and procurement training. Administrator Allen said the draft executive summary is still under discussion and the administration will provide a management response and corrective‑action plan to the commission.
Quote: "Overall, we did not find any fraud," Reagan said, while adding that the findings present "implementable policies and procedures" to strengthen controls.
What comes next: The commission will receive a formal management response and corrective‑action plan; UHY recommended the city monitor implementation progress on a six‑to‑nine‑month cadence.
