Following allegations of malfeasance, the State of Tennessee Comptroller of the Treasury found deficiencies in financial processes of the Carter County Tomorrow (CCT).
These five findings were revealed March 7, and board members passed five motions unanimously on March 10 to ensure proper oversight of financial transactions for each offense.
“These findings, all of which are — I will not say they’re not of importance — but they’re not a surprise for an entity the size of Carter County Tomorrow, and they are easily fixable,” said attorney Sam LaPorte, who acts as one of three presidents of the board since the former president resigned. “They are not findings that are of a material finding status … but they are findings that need to be addressed today by the board.”
Comptroller Justin P. Wilson’s findings are paraphrased as follows:
• CCT officials failed to separate financial duties adequately or to provide oversight when necessary. The financial director, Kim Eggers, received collections, delivered deposits, prepared checks and was responsible for payroll duties. Because of a lack of separation of duties, she failed to deduct 48 hours of vacation leave from her balance.
• CCT officials did not document or retain disbursements properly for credit card charges. Documentation frequently included only the signed agreement to pay without a detailed invoice or detail of purpose of the purchase.
• CCT officials did not provide adequate oversight for travel reimbursements paid to former president Tom Anderson to ensure that travel was for CCT purposes. Investigation revealed that neither a board member nor designee signed travel claims to indicate review and approval.
•CCT officials did not provide adequate oversight of the payroll. Neither a board member or designee signed time records of Anderson’s payroll, and after he left, no board official signed time records to indicate review of Eggers’ payroll.
•CCT officials did not ensure an annual audit, meeting minimum Comptroller standards, was performed in accordance with Section 9-3-212, Tennessee Code Annotated.
“We never knew an audit was mandated, but ignorance is no excuse,” said CCT Chair Richard Tester, one of three acting presidents.
CCT meeting minutes from February 2009 show the board approved a motion by attorney David Bautista, seconded by Dale Fair (one of three current acting presidents) to look into having an audit for CCT done by the same firm used by the City of Elizabethton.
The following month, then President Don Hurst said he was seeking a more affordable firm, but no complete audit has yet been conducted.
Eggers said that in the past, Karen McMurray, partner with Blackburn, Childers and Steagall, had performed review audits of the organization’s form 990s.
“Apparently, though an abbreviated audit of Carter County Tomorrow has been performed, that does not meet the standards of TCA 9-3-212,” LaPorte told the board. “We’re going to have to go through a full audit that will cost about $10,000 per organization. We do have the money, though it seems high.”
The comptroller Audit Manager Jean Suh, in a letter to the CCT Board of Directors, said the board would be reported to the district attorney if it did not provide proof of contract with an auditor as was requested previously. The letter was dated February 18 and gave the CCT board 30 days to comply.
LaPorte said the board had no record of the initial request and therefore did not ignore previous requests, but that regardless, it would be forced to comply and provide proof of intent to receive a full audit by showing contract with an auditor.
Tester said the audits would only be conducted for the fiscal year 2015, not retroactively, and only for the CCT and Tourism because they receive tax dollars. He said the Chamber of Commerce, Economic Development and the First Tennessee Private Industry Council (PIC) finances would not have to be audited. Tester said the CCT board meets as the Economic Development Board and as the PIC Board, though the entities’ finances are managed separately.
TCA 9-3-212 states, “It is the duty of each political subdivision, special taxing district, board, commission, educational cooperative, intergovernmental cooperative or other governmental agency … with respect to all funds under its control, to order and pay for such audit and for any other audit which it is required to perform under state law, and to contract with certified public accountants, public accountants, or the department of audit to make such audit.”