Killeen residents have a right to wonder what’s going on with the investigative audit into the city’s finances.

After a detailed report from the audit firm, Houston-based McConnell & Jones on May 2, there has been a decided shift in the atmosphere surrounding the audit process.

That initial report to the council, in open session, was a real bombshell — offering a list of troubling observations, including unauthorized use of bond funds, inconsistent planning for capital projects, misapplication of pay raises, and creation of an escrow account to transfer funds.

But after a June 6 briefing that contained very few details and last week’s closed-door session between the City Council and audit firm, the degree of transparency has notably diminished.

From the outside, the optics don’t look good, especially after City Manager Ron Olson sent an email to council members warning them not to ask too many questions of the auditors at the June council briefing. Olson was no doubt being cautious, not wanting auditors to feel obligated to make definitive statements in the face of an unfinished audit.

The audit is still not completed — in fact, it will require an additional two weeks to finish, beyond the initial July 31 target date. But it’s a safe bet that council members were asking pointed questions of investigators behind closed doors last week. The only difference this time is that the public couldn’t hear the answers.

The contract for the audit is between the audit firm and the council, so it’s understandable that council members would expect and receive a status update behind closed doors.

But a meeting between auditors and city staff members the following day is problematic, especially since some of the administrators receiving what was described as a “more detailed briefing” were involved in the city’s financial dealings during the period the audit investigation covers.

City Auditor Matthew Grady said the meeting’s purpose was to provide more information for auditors so they could have a clearer perspective on financial procedures and policies.

However, that information could just as easily be obtained through Grady, who is the designated liaison between the city and the auditors.

Meeting directly with city staff members before the investigative process is complete damages the audit’s credibility and raises questions about transparency.

Giving the staff a detailed briefing may be seen as a courtesy on the part of the audit firm, and certainly it’s important to rectify whatever procedural or accounting problems have been identified so far.

But meeting with staff while the audit is in progress has the appearance of offering the city a “do-over” so that any harsh initial findings can be softened or revised before the final report is issued.

It’s the equivalent of an employee getting to see his job evaluation in advance and work on the problem areas before the actual sit-down with the boss.

To date, the audit process has been marked by poor coordination and communication.

It’s hard to say whether that is a reflection on McConnell & Jones’ relative inexperience in conducting audits, or whether the council and staff have been sending mixed messages to the auditors.

But at this point, what the auditors have found and what they have been told is open to speculation.

Auditors promised a detailed midaudit briefing, as called for in the contract, for which they were to receive $10,000. After June’s brief council update, they said the midaudit briefing hadn’t yet taken place. Then they said it had but it had been renamed.

Council members and residents alike were left to wonder what happened.

Auditors also said they were having problems finding some older documents for their investigation, but until last week, they hadn’t talked to any former city department heads or supervisors who were in place during the time period of the audit. Are they going after the necessary information, or not? And if not, why not?

Then after last week’s closed-door meetings with the council and the Audit Advisory Committee, it was announced there would a delay of at least two weeks before the council could view the audit’s final results.

Auditors claimed the extra time was needed to process “an extensive data submission” by the city.

Mayor Pro Tem Jim Kilpatrick, who also chairs the audit subcommittee, would not say what the data was or when it was submitted.

What’s the new data, and how is it likely to impact the final audit report?

If council members know, they aren’t talking, at least not publicly.

So residents are left wondering exactly what the completed audit report will say — and what it will not.

Whatever the final conclusions, it’s incumbent on the auditors to clearly spell out the issues and problems they identify — and not feel compelled to walk back or soft-pedal their May 2 report to the council.

The last thing the city needs is to spend $400,000 in taxpayer money on a report that says a five-month audit found some problems, but they weren’t as bad as first thought, and what was found was fixed. So really, there’s nothing to see here.

That said, it’s entirely possible the audit will uncover some significant problems in its seven key areas of investigation and report them in detail.

With all the secrecy surrounding the audit process these days, it’s impossible to say which scenario to expect.

But barring another delay, we’ll have our answers in about six weeks.

Until then, all anyone can do is offer speculation, and there’s plenty of that to go around.

dmiller@kdhnews.com | 254-501-7543

(1) comment

Alvin

This is the personal opinion of this writer.
Copy: 'Killeen residents have a right to wonder what’s going on with the investigative audit into the city’s finances.' End of copy.
Or so the newspaper says. But 'what about the city'???? Do they agree that the council is only spending what they collect the money for and it's use is not for the council to spend pell mell, for 'what they, the council, at it's discretion, can met out'???? Is that the way our council operates now????
Copy: 'After a detailed report from the audit firm, Houston-based McConnell & Jones on May 2, there has been a decided shift in the atmosphere surrounding the audit process.'
Continuation of copy: 'That initial report to the council, in open session, was a real bombshell — offering a list of troubling observations, including unauthorized use of bond funds, inconsistent planning for capital projects, misapplication of pay raises, and creation of an escrow account to transfer funds.'
Continuation of copy: 'But after a June 6 briefing that contained very few details and last week’s closed-door session between the City Council and audit firm, the degree of transparency has notably diminished.'
Yes there was an 'audible' sense of 'muted' conversation in the delivery of the first, May 2, presentation and the the June 6, presentation after the city manager 'sensed' something was not going well for the city government and delivered his 'email edict' to the council. I don't know how to describe the characterization of the action of sending out the email, and I paraphrase: 'he was not sure of the course of action that the council should be taking as he did not want the contractor to be going off course and thus he felt that the best course of action would be to not take up the time in superfluous questioning of this contractor'. Now I do not know what information has been sent by this city management group to the contractor, but needless to say, 'the contractor in their June 6 presentation, that was following a 2 week delay in their scheduled delivery of a mid point delivery by contract in which they said 'nothing'. I believe the way the newspaper has said it:
Copy: 'City Manager Ron Olson sent an email to council members warning them not to ask too many questions of the auditors at the June council briefing. ' End of copy.
Umm, yeah that's it.
And after the ad hoc committee 'was' presented, through closed doors, this committee determined that 'additional information was indeed required, thus adding the necessity of a 2 week extension, this extension will be required by the contractor thus another delay in 'any' possible viewing of the contract audit by you and I.
Copy: 'The contract for the audit is between the audit firm and the council, so it’s understandable that council members would expect and receive a status update behind closed doors.' End of copy.
Yes, this contract was written so that the city management would be the 'first set of eyes' to be on this audit. And who can say:
Copy: 'But it’s a safe bet that council members were asking pointed questions of investigators behind closed doors last week. The only difference this time is that the public couldn’t hear the answers.' End of copy.
Yes the only difference was the public couldn't hear the answers. And It is 'a BIG difference'. We the general public was not privy to the questioning and answers in that 45 minute long meeting. For all we know, this ad hoc sub committee only gave the contractor a 'set of carefully prepared questions, and statements that was from outside of this committee'. Who can answer this city council people???? Or is it another case of the $750,000 that has not been answered as of this date,council sworn to secrecy.
Copy: 'Giving the staff a detailed briefing may be seen as a courtesy on the part of the audit firm, and certainly it’s important to rectify whatever procedural or accounting problems have been identified so far.'
Continuation of copy: 'But meeting with staff while the audit is in progress has the appearance of offering the city a “do-over” so that any harsh initial findings can be softened or revised before the final report is issued.'
Continuation of copy: 'It’s the equivalent of an employee getting to see his job evaluation in advance and work on the problem areas before the actual sit-down with the boss.'
Continuation of copy: 'To date, the audit process has been marked by poor coordination and communication.'
Continuation of copy: 'It’s hard to say whether that is a reflection on McConnell & Jones’ relative inexperience in conducting audits, or whether the council and staff have been sending mixed messages to the auditors.' End of copy.
In this section of 'copy', This newspaper 'hit the nail on the head', the question of 'meeting with the staff while the audit in progress, and 'it's the equivalent of an employee getting to see his job evaluation before it goes for record, and it's not hard to say that this is a reflection on McConnell &Jones, 'in my opinion, this city has been instrumental in shutting down anything that would be negatively reflected on this city management group, but we will never know will we????
So this city is left wondering 'if the audit is going to a complete audit, or if the audit will contain 'just what the conditions of this city government really is'???? Who knows because the ad hoc audit committee received, in another closed door session, what the contractor had prepared, and coupled with that, 'the city manager and his executive staff had a go at it along with the city auditors. Everybody got a good look 'at the original transcript except the citizens who asked, no demanded, for this audit to be completed.
Copy: 'Council members and residents alike were left to wonder what happened.' End of copy.
Copy: 'Auditors promised a detailed midaudit briefing, as called for in the contract, for which they were to receive $10,000. After June’s brief council update, they said the midaudit briefing hadn’t yet taken place. Then they said it had but it had been renamed.' End of copy.
Not only did the citizens not only 'not receive 'a detailed midaudit briefing, they proceeded into the 'final report that was completed behind closed doors'.
Copy: 'Then after last week’s closed-door meetings with the council and the Audit Advisory Committee, it was announced there would a delay of at least two weeks before the council could view the audit’s final results.' End of copy.
Now to my of thinking, and this would be in the form of a personal opinion, one of two things would happen, either the city would call for a penalty to be called for on the contractor, or the contractor would be calling for 'more money' due to the fact that this city has not upheld the terms of the contract. Now I wonder what will be happening????
Copy: 'Auditors claimed the extra time was needed to process “an extensive data submission” by the city.'
Continuation of copy: 'Mayor Pro Tem Jim Kilpatrick, who also chairs the audit subcommittee, would not say what the data was or when it was submitted.'
Continuation of copy: 'What’s the new data, and how is it likely to impact the final audit report?'
Continuation of copy: 'If council members know, they aren’t talking, at least not publicly.' End of copy.
It's the same Mulberry Bush that was mentioned before, lots of talk, lots of money being spent, no answers to be provided by the group of citizens who asked for this audit, and no answers being provided by this city who continues to operate ' behind closed doors'.
This, I personally think, will never be answered because of this city's 'operating behind closed doors'.
This has been the personal opinion of this writer and nothing shall be used, in context or without or changed in any way without first notifying, and receiving explicit approval from this writer.
One of the 4.58 % who voted.

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.