NORCO: Audit shows county in good shape
Northampton County’s Home Rule Charter requires an independent certified public accountant to audit the county’s finances every year. Nick Hoefel and Jill Gilbert of RKL presented their findings to county council Aug. 15. The county is in good health financially, with only one problem noted at the General Purpose Authority (GPA).
How healthy is the county? Its statement of net position, known in the private sector as the balance sheet, shows that the county has total assets valued at $321 million, and deducting liabilities, a total net position of $123 million. When money restricted for different projects and programs is set aside, there are $25 million in unrestricted funds. This is the county’s “play with” money.
Hoefel warned that “play with” money might be in negative territory next year. That’s because the county’s liability on post-retirement benefits, which currently is $53 million, may have to be included in next year’s balance sheet.
The audit also shows that Gracedale, the county’s nursing home, earned nearly $500,000 in 2017.
This year’s audit included the GPA for the first time, even though it is a separate body. In previous years, the GPA was audited separately from the county. Hoefel explained that it now must be considered a “component unit.” This is because of the P3 bridge project , in which the county has guaranteed the debt incurred to replace or repair 32 bridges.
The problem identified at the GPA is one it has had for years. It’s a lack of segregation of duties. That never mattered before the P3 bridge project, but now is considered a “material weakness” that must be addressed. Fiscal Affairs Director Steve Barron has proposed a solution in which the county’s fiscal department will handle the finances with internal controls that will prevent or detect fraud.
The RKL audit also recommends that the county establish a formal process for the disposal of assets that are no longer needed.