January 22, 2006 The 2001 Audit--An Official-looking Stamp of Approval to Altered Records of County Spending

Recent posts (Jan. 4th and Jan. 20th) have discussed the 2001 Hamblen County audit with its unbelievably high number of end-of-year alterations and adjustments to county spending records and the odd way these "adjustments" made total spending on numerous items appear like it was exactly what had been budgeted.

The taxpayers paid $28,000 for this audit and in return got a financial report that gave an official-looking stamp of approval to a meaningless and extensively altered record of county expenditures.

Detailed audit information and examples of how expenditure numbers were altered and manipulated in 2001 are already outlined in January 4th and January 20th posts.

Certain statements will be made by various officials and others about these posts. Probably the statements will be that this is no big deal or that making changes at year's end just so it will look like exactly $35,000 was spent on electricity or exactly $72,000 was spent on insurance is standard operating procedure for the county or for the auditors.

Well, what happened in the manipulation of county spending records in 2001 was not standard operating procedure for the county or for the auditors. There are some year-end adjusting entries for all years, but not adjustment after adjustment after adjustment to add or deduct an amount just to make the expenditures seem exact (and meaningless).

I took 7 categories/departments at random for 2001 and found approximately 90 end-of-year adjusting entries. I looked at those same 7 categories/departments in 2002 and found not one end-of-year adjusting entry.

The county's record of expenditures should not be contrived records that have been altered by hundreds of end-of-year adjustments that simply pull out a number ($11,289.42) and add it to spending here or pull out a number ($41,455.21) and subtract it from spending there-- all apparently to make certain departments look better and to shift expenses from the department or category where they were incurred to some other department or category.

A financial record should provide, at a minimum, at least a close record of actual expenditures for each department and for each line item within the department.

Because all the alterations in the 2001 audit seemed to make it a meaningless, but expensive ($28,000), record of county finances, I asked an individual who was involved in the audit process why there were huge numbers of adjusting entries in 2001 that made the expenditures come out even time after time after time. I also asked this same individual in the county finance department whether the expenditures shown in the 2001 audit provided an accurate record of actual spending in 2001.

I was told that this person did not want to answer either of those questions because the answers to those questions might reflect "badly" on someone.

Well, sometimes the answer you don't get reveals just as much or more than the answer you do get.

If you are afraid to answer the question 'Does the 2001 audit provide an accurate record of actual spending in 2001?', then your refusal answers that question loudly and clearly.

And what was being said by county officials about 2001 spending at the time? That will be the subject of the next blog post quoting an article that appeared in the Citizen-Tribune.