Report on city's finances may be delayed due to software glitch - CBS News 8 - San Diego, CA News Station - KFMB Channel 8

Report on city's finances may be delayed due to software glitch

Posted: Updated:

SAN DIEGO (CNS) - A comprehensive audit of city finances from the fiscal year that ended more than eight months ago might not come out until August due to a software glitch, a consulting auditor told a City Council committee Monday.

Linda Hurley, of the firm Macias, Gini and O'Connell, told members of the council's Audit Committee that she had been expecting to begin the audit later this month and get out the city's financial statement in June.

The statement is used by investors who are considering purchasing the city's bonds. It was learned last fall there would be some delays because of problems with a new software system, committee Chairman Kevin Faulconer said.

If things had gone smoothly, the auditor would have received the data by December, and the financial statement for the city would have been issued around this time.

Instead, Hurley said she didn't expect to even start the audit until May, and her final report will come out three months later.

City Comptroller Ken Whitfield told committee members that the software problems resulted in about 10,000 errors in entries of payroll data that goes into a complex matrix of data, and cannot be easily changed.

His staff has faced a "hellacious" workload, and has been working weekends to correct the information so that accurate numbers can be delivered to the auditors, Whitfield said.

"It's been vary important that we have the correct data, obviously," Faulconer said.

Councilman Carl DeMaio said that when he learned of delays in the comprehensive audit last fall, he believed it to be "a yellow flag. Now I would consider this a red flag."

Chief Financial Officer Mary Lewis said she alerted the major credit rating agencies of the delay last week.

Standard & Poor's suspended San Diego's credit rating seven years ago after it was learned the city failed to properly disclose the scope of the under-funding in its pension system, preventing the city from approaching Wall Street for bonds to upgrade its aging infrastructure. The firm didn't restore the city's credit rating until May 2008.

Getting the audits out on a timely basis is extremely important since the city has "a history of securities fraud," DeMaio said.

Members of the committee agreed to meet again in two weeks to monitor the comptroller's progress in correcting the errors.

Powered by Frankly
All content © Copyright 2000 - 2018 Midwest Television, Inc. All Rights Reserved.
For more information on this site, please read our Privacy Policy, and Terms of Service, and Ad Choices.