(Des Moines, Iowa) – Iowa Auditor of State Rob Sand, today (Thursday), released an independent auditor’s report pertaining to a periodic examination of the City of Wiota’s management and financial practices. The audit – performed by Gronewold, Bell, Kyhnn & Co. P.C., in Atlantic – covered the period of April 1, 2022 through March 31, 2023. The City agreed to have the audit performed.

The report states, that among other things:

• The City should review its control procedures to obtain the maximum internal control possible under the circumstances utilizing currently available staff, including elected officials. Independent reviews of reconciliations should be documented by the signature or initials of the reviewer and the date of the review.
• The City has not implemented the recommended Uniform Chart of Accounts (COA) for Iowa City Governments approved by the City Finance Committee. The auditor’s recommendation: “To provide better financial information and control, the recommended COA, or its equivalent, should be followed.”
• City Council proceedings should be published with a list of claims allowed, including the reason for the claim. The City Council minutes tested published a list of claims allowed, but the list did not include the reason for the claim; Recommendation – The City should comply with the Code of Iowa and publish a list of claims allowed, including the reason for the claim.
• The City has not adopted a written investment policy as required by Chapter 12B.10B of the Code of Iowa; Recommendation – The City should adopt a written investment policy that complies with the provisions of Chapter 12B.10B of the Code of Iowa.
• Disbursements during the year ended June 30, 2022 exceeded the amounts budgeted in the public safety, culture and recreation, community and economic development, general government and business type activities functions. Chapter 384.20 of the Code of Iowa states, in part, “Public monies may not be expended or encumbered except under an annual or continuing appropriation.”; Recommendation – The budget should have been amended in accordance with Chapter 384.18 of the Code of Iowa before disbursements were allowed to exceed the budget.
• Chapter 384.20 of the Code of Iowa states, in part, “A city shall keep accounts which show an accurate and detailed statement of all public funds collected, received, or expended for any city purpose, by any city officer, employee, or other person, and which show the receipt, use, and disposition of all city property.”
  • The City Fire Department maintains a bank account for activity separate from the City Clerk’s accounting records. While the Department is part of the City, the transactions and the resulting balance were not included in the City’s accounting records and were not included in the City’s annual budget, monthly financial reports or Annual Financial Reports.
  • In addition, the transactions and resulting balance of this account were not reported to the City Council and disbursements from the account were not reviewed and approved by the City Council. Also, a summary of the account’s receipts, total disbursements and the listings of claims allowed each month were not published in accordance with Chapter 372.13(6) of the Code of Iowa;
  • Recommendation – In accordance with Chapter 384.20 of the Code of Iowa, and to  strengthen internal control and increase operating efficiencies, the financial transactions of the Fire Department separate account should be integrated with the City’s accounting records in the City Clerk’s office. The financial activity should be included in the City Clerk’s accounting records, monthly financial reports and the Annual Financial Reports. The activity in the account should be subject to City Council review and approval and should be included in the City’s budget process. Also, a summary of the account’s receipts, total disbursements and listings of claims allowed each month should be published, as required.
• The City’s Local Option Sales Tax (LOST) ballot requires LOST receipts be used 90% for community betterment and 10% for property tax relief. The City has not been tracking the
  use of LOST receipts; Recommendation – The City should implement procedures to track LOST disbursements.

Read the full report HERE.