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TARDY FIGURES 

Audit of city finances released three months late

  Accountant Joey Richard of the Baton Rouge CPA firm Postlethwaite & Netterville presented the New Orleans City Council Budget Committee on Oct. 4 with its Consolidated Annual Financial Report (CAFR) for fiscal year 2010. The report, an annual audit of the city's finances, was due to be completed by June 30 but was not released until late last month.

  Along with the CAFR, Richard laid out a second report on accounting and budgetary problem areas. "There are 13 findings in the report," Richard said.

  Number 13, among the more serious, noted that the city did not meet the June 30, 2011, deadline for reporting its CAFR to the State of Louisiana. The report blames a lack of staff in the city's Finance Department. Among the more serious findings was the city attorney's lack of a list of pending and settled litigation — including the costs of legal claims.

  "Are you saying we don't have a list of all the litigation pending against the city?" asked District B Councilwoman Stacy Head.

  "There is a list," Richard said.

  "But it isn't accurate," Head said.

  Richard agreed that it wasn't.

  "That is a problem," Head said.

  Richard found that city employee credit card payments often were not properly documented, and sometimes not documented at all last year. That ended, however, when Mayor Mitch Landrieu issued a new, stronger purchasing policy in May 2010. Overtime abuse also continued to be a problem. According to the report, the accounting firm "observed 9 employees [from a list of the city's 50 highest paid employees] that on a cumulative basis exceeded the 416 [overtime hours] limit by an estimated 12,000 hours."

  Other issues included inefficiencies in recording property tax revenues, FEMA grant revenues and an overall failure in the way the city keeps track of contracts. Richard recommended a centralized system for recording contract amounts, along with more transparency in reporting new contracts to the public. On the last point, Head noted that the city had not been living up to its own laws, which require that all professional service contracts be published on the city's website. "I was looking for a contract there the other day and couldn't find it," she said.

  The budget committee will meet with members of the Landrieu administration later this month to discuss potential fixes. The committee didn't set a date, but Council president Jackie Clarkson said it would be before 2012 budget hearings begin at the end of the month. — CHARLES MALDONADO

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