City Council Member Brinkhoff-Riley Releases Audit Recording
Evansville – Today I am releasing a full, unedited copy of the recording of the March 12, 2014 City of Evansville 2012 audit exit conference conducted by the Indiana State Board of Accounts. The people of Evansville deserve to know this information. The audio recording will be posted on my web page, www.VoteBrinkerhoffRiley.com, immediately.
The state auditors gave the city finances an overall “Qualified Opinion†with “Adverse Opinions†on select portions. A “Qualified Opinion†is issued when accounting practices do not comply with generally accepted accounting principles. The Winnecke Administration’s inability to do basic bookkeeping means that the City of Evansville’s financial records are not acceptable under Indiana law or general accounting principles.
Further, the balances reported on the books are not accurate. A key point raised by the auditors is that Mayor Lloyd Winnecke has not been able to balance the city’s payroll account since he took office. This means the payroll account has not been properly reconciled since December 31, 2010, nearly four years ago. This failure to reconcile the books is in spite of spending nearly $2 million dollars on software support, an extra full-time employee, and consulting fees to outside accounting firms.
The failure of the Winnecke Administration to resolve the problems with the city’s financial records may subject the taxpayers to higher interest rates when we borrow for upcoming projects such as the new hotel and medical school campus. Even more, it shows a striking inability to perform one of the most basic functions of government: keeping track of the money.
I call on the administration to immediately outline a plan for resolving all issues raised by the auditors prior to beginning the 2013 audit and to present this plan to city council for review and approval.
Evansville 2012 Audit Exit Interview Key Points
The city did not properly record payroll funds in 2012; Balances may be incorrect and don’t permit auditing.
City fund balances, including water and waste funds, were not properly reconciled to bank balances in 2012.
2012 funds submitted for audit were overstated due to checks discovered on the outstanding list that had already cleared the bank and incorrect postings to the ledger. Auditors found fund transactions withdrawn from incorrect accounts and random adjustments that were added then later deleted when submitted for audit.
City has failed to design effective controls over preparation of bank reconciliations to prevent or detect material weaknesses, and the City has failed to design effective controls over the postings of payroll funds to prevent or detect mistakes; The City cannot reconcile its payroll account.
City does not do monthly bank reconcilements; Bank shows funds are approximately $500k more than the city balances; Payroll and pension check samplings showed payments in incorrect amounts with overpayments to employees and underpayments to pensioners.
City Councilman Conor O’Daniel told reporter he signed a confidentiality agreement at start of the same audit exit conference that Stephanie Brinkerhoff Riley attended and recorded.
Stephanie Brinkerhoff Riley told reporter she doesn’t recall signing any agreement, and if she did she took it to apply to the audit and not the exit conference that she then recorded and released.
“I don’t recall” is a standard answer for I’m not going to tell you the truth.
Sounds real fishy that she can’t recall signing it but conveniently had the excuse ready that she took it to mean it only covered the audit document and not the exit interview.
Only an incompetent lawyer wouldn’t read a document that she was asked to sign her name to and calls to question whether she reads all the documents she signs as council member, especially as vice president of council.
Willful disregard of a confidentiality agreement after signing it raises other critical questions.
That’s easy enough to answer; get a copy of the confidentiality agreement.
I’m sure if one exists it will be brought to light soon.
Those confidentially agreements are not worth the toilet paper that they are written on. People have the right to speak out and can’t be silenced.
People are silenced in the Soviet Union and North Korea or China not the USofA. We are free people and have a second amendment and thus are free to speak out.
And Guess what Wayne. Stephanie uses her REAL NAME. Who would have THUNK (SIC) IT>
Thank you for your astute comment Mayor. Now, let’s get to the meat of the matter, will you please explain why neither you or your predecessor, Lord High Weinzapful, have been or are unable to balance the financial records of the City? In particular, I’m curious about the “overpayments to employees”.
Have you listened to the tape? Do you not agree no matter the confidentiality of the meeting that it warrants being released to the public?
Yes I listened to most of the tape. I also read her summary of SBOA highpoints at her website. However, nothing excuses entering into a legal agreement and then violating your word. What sort of honor is evident in that?
You’re tilting a windmills, Don Quixote.
A lot more honor than screwing over the citizens of Evansville umpteen times to the tune of millions of dollars.
Truth Serum,
Is it more honorable to TELL A LIE about the books being reconciled ?
Go back and look at the City Council Meeting Minutes, and get a load of Russ Lloyd and the fat guy from Umbaugh CPA’s repeatedly LYING to the City Council about the reconciliations.
I believe the big lie told by Russ was that they were completely reconciled; and they actually showed $ 18,000 more than the Bank. How’s that looking about now ?
We will make sure the state police issue her a ticket for doing 60 in a 55, meanwhile the malfeasance at the Civic Center is no big deal?
Correct?
They Mayor and the city council say the pledge of allegence ot the United States of American before ever city council meeting.
The Mayor as does the Governor and the President of the USA takes a pledge when they are sworn into office after they get elected and before they can assume those high government offices.
Government officials work for “We the People” not the other way around.
You should be asking the Mayor why he failed his oath of office? And you should ask him why he can’t balance the books?
The oath of office taken by city council members includes swearing to uphold the laws of the State of Indiana. So we shall see who has violated their oath.
How about that law that says the accounts have to be reconciled on a monthly basis. Who gets charged with 40 counts of violating that law?
IMHO: SBR is doing her duty as a Public Servant and watchdog over the reputation and financial stability of Evansville. It takes courage and character to become a whistleblower in the midst of a multitude of go-along-get-along politicians.
I would support her in a future bid for any political office in this town that requires value judgement, honesty and transparency.
“If” she picked up an infraction while doing so, it only increases the value of what she did today. …
Thanks SBR!
I support her as well, but to release it on your campaign website? THAT is in bad taste. It makes it seem as if the REAL reason was to win political support and not because she thought it was the right thing to do…..
SBR, you have my support, but come on…..
This sort of unethical espionage should be grounds for criminal complaint.
It would be if it were a crime Bill. Indiana is a single consent state. When she was invited to the meeting as a participant she was implicitly given the green light to record it.
Damn, the auditors have it down to pretty fine detail (and it’s not pretty).
Big picture, if it’s already detailed down to the list of findings; and it’s a ‘Qualified’ opinion, why won’t they issue said ‘Qualified Opinion’ ?
Citizens, SBR had it right: we are witnessing a cover-up in slow motion !!!
Bravo Stephanie, especially for posting the audio recording.
When will the transcript be posted ? If it’s not available, I will chip in to get one of those Court Reporters on that today !
I was a Controller at several manufacturing concerns early in my career. I can walk-the-walk on audit speak.
I find this excerpt problematic:
“random adjustments that were added then later deleted when submitted for audit”
OMG, you can try to spin this all day. It means that City Finance Dept. had no idea what was going on. Did they fabricate the adjustments to try to make it appear they were reconciled? I read on another thread that there were multiple versions of reconciliations submitted to the Auditor.
As we like to say in the trade, ” that’s a NO-NO”.
I am stunned it was “only” a ‘Qualified’ opinion. Winnecke ought to be dancing in the streets to have received a ‘Qualified’, yet it appears he got greedy and was going back in to grovel for a clean opinion.
CCO:
You’ve been accused of having a transcript of the meeting.
Since you’ve been accused, why not now go ahead and order one up ! Instead of your readers having to just settle for the bullet points, let us read the context of the comments as well.
A transcript will be very handy if/when the ACTUAL AUDIT REPORT ever materializes.
“City fund balances, including water and waste funds, were not properly reconciled to bank balances in 2012
“City fund balances, including water and waste funds, were not properly reconciled to bank balances in 2012”
What in bloody hell does this mean ? I believe ‘waste’ = “Sewer”.
“Not properly reconciled” covers a lot of real estate–surely there is further elaboration ?
Is someone stealing the tax payers hard earned money? What’s really going on at the Civic Center?
It was interesting to listen to the full, actual recording. Two key questions were asked and responded to by the Audit Board staff.
Any evidence of missing funds … NO
Is the situation better than the prior year … YES
As much as I was expecting all the delays, recordings, press conference, etc. to paint the worst possible picture, frankly that is not what I heard after listening to the recording.
I mean I wouldn’t hire the city financial function to manage my personal funds since the audit recording seemed to confirm some real incompetent handling of things. But the to the questions that I think most people would ask, and which were pretty directly ask during the recording, it seems a much cleaner picture than some seem to have painted by their comments and suggestions.
This report hasn’t revealed much.
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