Controller Melinda Kantner, in filing her report last Friday to the Court of Common Pleas of Schuylkill County and the Pennsylvania Department of Community and Economic Development (DCED), a letter was attached explaining the history of the causes of delay. The report on the county's financial expenditure for the previous year is annually due July 1 but was not filed until October 1. A single external audit is yet to be filed by Sam Deegan, contracted by the county commissioners to complete the audit that was due Sept. 30.

The letter states: "For at least 20 years the county has contracted with its external auditor to conduct, not only the single audit, but also to supply a draft of the DCED report and preliminary drafts of basic financial statements and footnotes to the county. The firm of L. Sam Deegan was contracted to provide these services to the County of Schuylkill for the fiscal year 2009 audit. To date, the reports and statements have not been produced and presented to the county by Mr. Deegan's firm."Blamescommissioners"Both DCED and the Court of Common Pleas were aware that extensions for the filings were requested on behalf of Deegan who required additional time. The county court denied the extensions. The delayed filing could be considered the result of transgressions committed against the controller's office by the county's own board of commissioners."These actions began in December 2008, when the commissioners voted as salary board members to delete the position of 'single audit coordinator' from the controller's office. This position was held by Paul Buber, CPA, MBA, a seasoned employee with 24 years of governmental accounting experience who was transferred to the commissioners' office to hold the position of 'financial analyst', a new position created by the commissioners."At that time Commissioner Gallagher (chairman of the board) assured the public Mr. Buber would continue to perform all the duties he previously performed in the Controller's office, along with his new duties. Unfortunately, this has not been the case, due to the fact certain statutory duties, such as filings to DCED and the County Court must be performed by the Controller's office. This deleted position would perform many vital duties on behalf of county taxpayers, such as preparation of financial schedules, disclosures, provide assistance to external auditors, examination of financial records, preparation of action plans evaluation of audit requirements for grant programs, internal audits, evaluation of recommendations for internal control systems, evaluation of changes to IRS tax code, generally accepted accounting principals and generally accepted auditing standards and any impact upon county operations. The negative impact of the deletion of this position has been profound and lasting."From fiscal year 2008 to fiscal year 2009 the Controller's budget was cut by $72,960 and from 2009 to 2010 cut an additional $48,231 and exempt employees within the Controller's office were essentially made hourly employees with significant reductions in hourly wages which has been construed as an attempt to jeopardize the independence which should exist in the Controller's office."Kantner also states in the letter she objected to hiring of Deegan who was one of four firms who bid for the job because of his "lack of county single audit experience and his apparent underestimation of the number of hours required to completed the audit." (Three firms who bid all have experience in making up county audits including the firm previously under contract with the county but all were outbid by Deegan).Claims cooperatedAlthough Deegan claimed he was 'stonewalled' and did not receive cooperation from the controller, Kantner states in her letter, "The Controller's Office has gone above and beyond the call of duty for this auditor. To date, the material we have supplied to Mr. Deegan's firm exceeds four feet in height. Our auditing staff has spent in excess of 1,200 hours compiling information, reports, schedules, answering questions and assisting Mr. Deegan. The Controller's Office cannot perform an audit for the external auditor, we must remain independent both in fact and in appearance. In past years, the auditing firm would have completed their field work by late April or early May and would have submitted the necessary information to county departments by mid-June, in order to allow the county to complete information necessary for submission of the single audit package."Failure to file the single audit package by Sept. 30 will result in the county being categorized as a 'high risk" auditee which means 50 percent of the county's funds must be audited, instead of the traditional 25 percent. A delayed single audit submission could likely result in delayed or withheld state and federal grants and a poor bonding rating."Kantner concludes by stating, "Had the Board of Commissioners heeded repeated requests to assess Mr. Deegan's progress, to recognize his breach of the contract and bring in an audit firm capable of completing the audit this serious predicament for the County could have been avoided."The audit report by Kantner submitted to the court and DCED she explains, "the completion was limited to presenting in the form prescribed by the DCED information that is the representation of management. We have not audited or reviewed the financial statements and do not express an opinion on any other form of assurance on them. These financial statements are presented in accordance with the requirements of DCED, which differ from generally accepted accounting principles."