HATTIESBURG, MS (WDAM) - The Hattiesburg City Council voted unanimously to hire an independent Certified Public Accountant (CPA) to address issues in the city's municipal court.
Ward 3 Councilperson Carter Carroll said the city will receive a performance audit from an independent CPA to determine why the city's municipal court is not in line with state accounting principles.
The city is hiring M. Gregory (Greg) King, CPA from Haddox Reid Eubank Betts, PLLC for an estimated $14,000 to "assist the City of Hattiesburg, Mississippi (the City) in the process of identifying and providing solutions for areas in the city's current accounting system that do not provide optimum reporting to the city's management," according to a letter sent from Haddox Reid Eubank Betts, PLLC to the mayor and city council on Monday.
"What he is going to do is come in and look at the court system, federal programs and water and sewer to see how they are performing their reports," Carroll said.
According to the letter from Haddox Reid Eubank Betts, PLLC, King will focus on "four key accounting functions: water and sewer billing and collections, court fines and assessments, federal programs receipts and compliance, and general accounting functions to include the flow of accounting data from the various city departments to a centralized accounting function."
According to the city's most recently completed 2014 audit by Carr, Riggs & Ingram, LLC, "The city's accounting procedures for Municipal Court fines receivable are not in compliance with accounting system procedures prescribed by the State Auditor under Mississippi Law."
"Their reports are not meeting up to the state standards for accounting practices, and we need to get those on board," Carroll said.
King will start evaluating the city's accounting procedures "within one week" from the council's Tuesday approval.
"He's going to look at the guidelines they're using now," Carroll said. "He's going to look at our software. Everything. Then he's going to create the new guidelines that they need to perform on to meet the standards of state accounting policies, and then, actually, if they need training on how to do that, he will be there to do that."
King's evaluation will include six procedures, according to the firm's letter to the council:
- Interview personnel with duties and responsibilities [in the various] accounting functions
- Review available documentation detailing the accounting processes being performed
- Review reports generated in the various accounting cycles
- Review and document the management structure and flow of information within the accounting function
- Review and document the specific procedures being performed by the various personnel operating in the accounting function
- Discussions with the city's current auditors and review of prior year management letters issued by the auditor
Carroll said King will work with they city's auditing firm Carr, Riggs & Ingram, LLC, but said the city did not want its auditing firm creating guidelines for the court to prevent a conflict of interest.
"Our auditing company doesn't need to create the procedures and then audit those procedures," he said. "So we're getting an independent person to come in, create the procedures, and he has done this many times before, to create the procedures to meet the standards of the state. The our auditors can come in and say, 'they're doing it correctly.'"
Carroll said the city is aware that its court system has not been in compliance with state law for years. The city's 2014 audit stated Hattiesburg needed to have its "corrective action plan" completed and implemented by December 2016. Carroll said Tuesday's vote is an attempt to expedite getting into compliance.
"I hope that we can get this done within the next four to six weeks," he said. "Greg is going to come down here for two days. he is going to look at the court system, the federal programs and water and sewer. He's going to make his recommendations. He'll know by then the time frame it's going to take, and then he'll start interviewing each personnel that's down there. You know, what they're doing know, how they're doing it, why they're doing it, and then he's going to create the policies that we well then follow, or the guidelines, to meet the state requirements."
Haddox Reid Eubank Betts, PLLC states King will "document the results of these procedures in a formal report" containing:
- Detail listing of processes and procedures deemed to be problematic grouped by the following categories
- Personnel issues
- Accounting system including computer software
- Accounting procedures and documentation to include the flow of data within the various departments of the city
- Recommendations to address the areas of weakness identified
Carroll said the bottom line is the city needs help to have its audit's completed correctly and on time, so the city isn't missing out on money or programs.
"We need to get our auditors the correct reports, so that they can do their job in a timely fashion," he said. "Just like anything else, when you go for bonding, the bonding companies what to know that you have your audits in on time and that they can look at it, just like a bank would want know that you're paying your bills and your taxes. For federal programs, for state programs, you need to have your audits in. They want to look at them."
Mayor Johnny DuPree has 10 days to sign off on the hire, but if he does not, it passes without signature.