Clark County made significant accounting errors during 2013, which could affect its ability to accurately produce financial statements, according to a state audit.
The audit found that the county applied insufficient accounting research to unusual transactions and didn’t adequately ensure that potential legal losses were completely recorded.
In particular, the county’s Department of Environmental Services did not record a $3.6 million legal loss related to its violation of the Clean Water Act, until auditors pointed it out.
The county’s Clean Water Fund also inaccurately included $3.1 million in construction projects that were no longer in progress. And depreciation of road infrastructure was understated by roughly $6.2 million, according to the state report, released Thursday.
Other errors highlighted in the report included the county misclassifying the restrictions of the difference between assets and liabilities in the amount of $19.8 million. Equity in government accounts also was misclassified in the amount of $16.4 million.
In neither instance did the county misappropriate or lose money, said Tina Watkins of the auditor’s office. Rather, the amounts were misclassified.
Several of the errors were fixed after the auditor’s office pointed them out, Watkins said.
In a response statement, the county disagreed with the state’s findings, writing that there are “differences of professional opinion about methods of accounting for assets and disclosing the likelihood of future expenses.”
The county points out that it approved paying the $3.6 million legal settlement in March, following a December agreement to do so, and it disclosed that expense in its 2013 statements. The county also disagreed that its methods for depreciating roads were incorrect, writing that they had no “material impact on the accuracy or reliability of our financial statements.”
A second state audit, also released Thursday, found that in most areas the county complied with state laws and its own regulations.
As part of the audit, the state investigated whether there was lax oversight over Don Benton, the county’s director of environmental services and a state Senator.
The investigation was spurred by a citizen complaint about Benton and his dual role as director of a county department and lawmaker. At issue was that Benton, a Vancouver Republican, continued to work for environmental services during the legislative session.
County Administrator Mark McCauley said it would have been unreasonable to prevent Benton from overseeing the department during the Legislature. He said Benton kept track of his hours, like other employees do.