LIHUE — Findings from N&K CPA Inc.’s audit report were in the same areas as the findings from the last fiscal year’s audit report. But the county has made progress in each of the areas. Wednesday, representatives from N&K CPA’s
LIHUE — Findings from N&K CPA Inc.’s audit report were in the same areas as the findings from the last fiscal year’s audit report.
But the county has made progress in each of the areas.
Wednesday, representatives from N&K CPA’s Inc. briefed the County Council on the Comprehensive Annual Financial Report, Single Audit Reports and Management Advisory Report for the fiscal year that ended June 30.
Following through with paperwork was the root of the majority of the problems that the audit company found.
The auditors randomly sampled 60 county employee records this fiscal year, and out of those, they found eight that did not have the supporting leave forms attached to records that indicated the employee had used vacation and sick leave.
According to Janine Rapozo, director of the county’s human resources department, in many cases employees got verbal approval from their supervisor to get time off and then the accompanying paperwork wasn’t filled out.
“I know this was a finding last year, and the year before, and the year before,” said Mel Rapozo. “This is a recurring problem and it’s a big one, but it’s a simple fix.”
Rapozo said his suggestion is to hold supervisors accountable for neglecting to finish the paperwork accompanying vacation and sick leave.
Last fiscal year, auditors found 25 out of 60 samplings that had discrepancies in the paperwork and vacation or sick leave records.
Janine Rapozo said one of the reasons for the improvement in the reporting is that the county is centralizing the reporting process through the human resources department.
Record keeping is also transitioning from a manual method to a more computerized system.
Reconciling those written forms and the information in the computer has been time consuming, Janine Rapozo said, but 16 of the county’s 18 departments have reconciled those reports.
The other challenge the human resources department is facing is that there are different requirements for vacation and sick leave for different unions and collective bargaining agreements.
“It’s a complexity that’s caused by the unions and bargaining agreements that we are operating under,” she said.
Though Rapozo cited an electronic transition as a big source of discrepancies in reporting, Council Chairman Mel Rapozo said he was concerned that it was a matter of people not doing their job correctly.
“I think now we’ll go back and say, what exactly is the breakdown,” Janine Rapozo said.
Purchase reports
The county uses purchasing cards (P-Cards) for purchases under $1,500, which are a form of charge cards that allows goods and services to be procured without using a traditional purchasing process.
In last fiscal year, the audit company found six of 40 randomly selected purchase reports in which the purchase wasn’t approved beforehand or not at all.
This fiscal year, three of the 40 samplings were found to have discrepancies. In two of those instances, approval was received after the purchase was made and in one of them, there was no record of approval of the purchase.
One of those findings was in the engineering department of public works, and the other two findings were in the parks and recreation department.
FY 2014 had about 7,000 transactions, totaling to about $1.7 million, and six findings. FY 2015’s purchasing amount rose to about $2.2 million, with 8,000 transactions and three findings.
“It’s not a perfect system yet, but we are making progress and there’s room for improvement,” said Nadine Nakamura, county managing director.
Monitor delinquent receivable accounts
The county has more than $147,000 worth of receivable accounts that haven’t been collected, and the bulk of that money comes from one company.
The company owes the county $91,259 in tipping fees at the landfill.
The details are muddled and administration, as well as the county attorney’s office, has to drudge through records to find the exact timeline, but the case is thought to have begun around five years ago.
“We notified the client at 60 and at 90 days, then we cut them off and the case was referred to the county attorney and went through the process,” Tabata said. “Then the organization was disbanded and the assets were liquefied and we were unable to collect.”
He said the other nearly $57,000 in receivable accounts has been turned over to the county attorney as uncollectable.
Councilwoman JoAnn Yukimura suggested that the solid waste department look into policies that would halt the accrual of that large of an amount of debt. She also requested a detailed history of the $91,000 debt.
Councilman Ross Kagawa suggested the subject be brought up in committee, and possibly in an executive session, so there can be discussions about policy and an opportunity to develop strategies to keep amount of money in delinquent receivable accounts lower.
“I’m glad the administration has improved over last year,” Kagawa said. “Continued improvement is what I’m searching for.”
