Shreveport’s Independent Audit Reveals Serious Financial Weaknesses and Deficiencies

Shreveport Faces Financial Challenges Following Independent Audit

Hey there, residents of Shreveport! We’ve got some news that might make you raise an eyebrow or two concerning our city’s finances. An independent audit, conducted by the reputable accounting firm Carr, Riggs & Ingram, LLC, has brought some troubling findings to light. The audit was done for the Louisiana Legislative Auditor’s Office, and it reviewed our city’s financial statements for the year ending December 31, 2023. And let me tell you, it’s not particularly flattering.

Nine Material Weaknesses Identified

According to the audit, Shreveport has been flagged with nine material weaknesses and deficiencies in its financial processes. So, what does that mean, exactly? Well, basically, these issues highlight serious problems regarding how our city handles its finances and, ultimately, the accountability of the funds we, the taxpayers, contribute.

Improper Budget Transfers

One of the most significant findings was the presence of improper budget transfers in city journal entries. It turns out city officials recorded transfers in the general ledger based on budget ordinances, rather than actual cash movement between funds. The auditors noted that these entries should only be made when there’s a legitimate transfer of cash, leading to materially misstated transfer accounts. Yikes!

Lack of Collection Procedures

Next up, there’s the issue of Shreveport not tracking and collecting receivables adequately. As of December 31, 2023, these unpaid balances have ballooned to a staggering $8 million. Here’s a thought: If we’re not following up on outstanding debts, how can we expect our city services to improve?

Account Balances Not Properly Analyzed

The audit raised another flag regarding how the city reports its significant account balances, saying that there simply aren’t enough controls and procedures in place to ensure accurate analysis and reporting. This kind of oversight can lead to serious financial discrepancies.

Errors in Compensated Absences

Now, let’s talk about compensated absences—this relates to the earned leave time owed to city employees. It appears there were material errors in how these absences were reported, potentially overstating the city’s liabilities. This could be impacting the city’s financial standing.

Documentation Issues in Expenditures

The fire and community development departments were also caught off guard, as they failed to provide timely and accurate documentation for the expenditure report. This report lists all the federal funds spent during a fiscal year and is critical for transparency and accountability.

Payroll Deficiencies

Also concerning is an issue with payroll in the police department. The audit found that an employee who had gone on disability continued to receive full pay for an astonishing nine months without proper notification to the payroll department. This doesn’t seem fair, does it?

Misappropriation of Assets

And the hits just keep coming! The audit revealed a misappropriation of assets involving two officers who were accused of fraudulently claiming overtime pay that they never earned. One of the officers has already pled guilty to wire fraud and is now on probation with fines and restituution to repay. What a mess!

Timely Reporting Failures

Last but certainly not least, the Fire Department didn’t properly submit required quarterly and semi-annual reports, showing a glaring lack of compliance with grant agreements. This kind of oversight can have lasting repercussions for our city.

City Officials Respond

In light of these findings, Shreveport’s city officials have expressed their commitment to addressing these deficiencies. They agree with the audit’s exceptions and have already begun working with the relevant departments to get things on the right track.

So, what does this all mean for us as residents? Well, it suggests that there needs to be a concerted effort from city officials to improve our financial stewardship. After all, our tax dollars are at stake, and we all deserve a city that’s transparent, accountable, and fiscally responsible!

Let’s keep our fingers crossed that with some proper planning and action, Shreveport can turn this financial ship around!