State Auditor Releases Audit of City of Washburn, Finds Inaccuracies with City’s Financial Practices

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**PRESS RELEASE**

 

 

FOR IMMEDIATE RELEASE

April 9, 2019

 

State Auditor Releases Audit of City of Washburn, Finds Inaccuracies with City’s Financial Practices

 

Contact information: Brianna Ludwig, North Dakota State Auditor’s Office, 701-328-2453, bsludwig@nd.gov

State Auditor Joshua Gallion today released an audit of the City of Washburn highlighting several areas of concern including a potential violation of state law which requires the city to set up a separate fund for each special assessment project. Due in part to the city’s failure to adequately account and monitor special assessments, the negative fund balance has grown from $324,236 in 2016 to $639,911 in 2018. Our audit also found improper payouts of $6,807 in annual leave that had not been earned by three city employees.

"Citizens deserve a government that functions effectively and transparently, but processes were not in place in the City of Washburn to ensure this is the case," Auditor Gallion said. "I'm encouraged that the city seems to be taking the recommendations in the report seriously so they can better serve taxpayers." 

The report also covers several other deficiencies in accounting practices and procedures. City accounting personnel lack the necessary understanding to maintain proper financial records. The full report details improper fund transfers, lack of segregation of duties, lack of special assessment reporting, potential North Dakota Century Code violation as it relates to special assessments, inadequate board approval of invoices, inadequate voided check controls, lack of a fraud risk assessment and the improper vacation leave payout. Our audit also provided recommendations for the city to improve fiscal accountability to taxpayers.

The complete audit report can be found on our website, http://bit.ly/washburnaudit.

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