Mayor Brian Arrigo announced the findings of a comprehensive external review that has resulted in the identification of over $2 million in city funds of which nearly $800,000 will be returned to the city’s general fund and the remaining money will be returned to the state and federal governments. The audit was commissioned by Mayor Arrigo in March of 2016 as he sought to review all city departments’ financial accounts and operational policies, procedures.
“Our residents deserve nothing less than modern, proficient, and effective government,” Mayor Brian Arrigo said. “We have a great city and I gladly take on the task of adding great government to the list of all the other big things happening in Revere.”
CliftonLarsonAllen (“CLA”) a highly regarded audit, tax and consulting firm, was engaged to perform consulting services and review various activities and internal controls of city departments. They also were commissioned to provide a full documentation and report that includes recommendations for improvement.
The report on review and documentation of various activities and internal controls included:
- Review of all active funds reported on the MUNIS accounting system and detailed descriptions of the stated purpose of the funds, the revenue sources and expenditure types expended from the funds over the past two years and determine (for each fund) whether or not the fund was created and is operating in compliance with Massachusetts General Law.
- Review of the Department of Community Development and its management, accounting and reporting of federal grants. Identification and review of transactions and/or relationships the Department of Community Development has with non-profit organizations (e.g. The Revere Business Development Corporation).
- Review of the City’s compliance with Massachusetts General Law (MGL), Chapter 30B Uniform Procurement Act. Using the MUNIS system we identified significant vendor payments and verified that the provisions of Chapter 30B were followed prior to contracting with the vendors.
- Review of stipends paid to City employees/officials and understanding the purpose of the stipends, basis for the amount and determining if there is proper documentation to support the earning of such stipend.
- Review of the City’s cash receipt policies and procedures, consisting of reviewing cash receipts policies and procedures in the various departments of the City that collect significant amounts of cash.
Through the work of CliftonLarsonAllen we identified 86 funds with cash balances as of June 30, 2017 for which no revenue or expense activity had been recorded since fiscal year 2014. Some funds did not have activity recorded to them since as far back as 1998.
In addition to the nearly $800,000 dollars returned to the city, there were several recommendations for better operational procedures including:
- Create a standardized, comprehensive Cash Receipts Policy and Procedure Manual that includes information specific to each department, distribute and train all employees about the updated policies and procedures to promote consistent application.
- City’s Auditor send interim general ledger reports of revenues to all departments for review and reconciling of general ledger reports to internal records of revenues.
- Review staffing and responsibilities of departments to ensure segregation of duties in the area of cash receipts
- Review safeguarding procedures for the handling of cash to reduce risks associated with theft or other improprieties.
- Consider allowing credit card payments for activities that don’t already allow for it.
- Review policies and procedures for reimbursing petty cash and implement new solutions to enhance timeliness of reimbursements.
- Recommend Treasurer/Collector’s Office record all cash receipts using the MUNIS cash receipt module, timely as the cash receipts are received and deposited into the bank and that the City fully integrate its utility billing and property tax billing
As the City of Revere moves forward in implementing the recommendations, Mayor Arrigo will continue the work of upgrading the systems in all departments to provide for better management and efficiencies across the city.