Each summer, the state’s municipal audit manager, Amy Dale, heads out to perform field reviews of accounting firms around Oregon, as well as a few in Idaho. The firms she visits perform financial audits for Oregon’s municipalities. It’s part of Amy’s unique role as a municipal auditor manager for the state of Oregon to help ensure local governments provide annual financial reports. I sat down with Amy between some of her field reviews this month to learn more about it.
Oregon’s municipalities are any cities, counties, school districts, special districts, or corporations subject to local government control that receive tax dollars from Oregon residents. A municipal audit law, passed in the early 1900s and updated most recently in 2015, requires that municipalities file a financial report each year. These are made public on the Secretary of State’s website. Annual filing helps promote transparency and accountability regarding the money they collect from residents, and the summary of audit reports completed by the state’s municipal program provides an overview of the status of larger municipalities.
Of the state’s 35 financial auditors, only two work fulltime in the municipal audit program. In addition to supporting the firms who provide the audits, Amy works directly with the municipalities throughout their submission process, oversees the review of a sampling of financial reports each year, and, with her team, provides feedback on whether the reports meet financial reporting requirements.
“I love this role because it’s interesting,” says Amy. “There’s always something different happening, and there’s a strong sense of helping residents and local governments, which is something I value.”
Amy’s role may have been a bit simpler in the early days, when there were a lot fewer of these municipalities. Now, around 1800 municipalities of a variety of size and purpose must file financial reports. Oregon’s cities, counties, and school districts make up about a third of them. The remaining 1000+ districts are special districts. They perform specialized services for the area where they operate, such as water, irrigation, fire, emergency management, pesticide, parks and recreation, and many more. To fund these services, they collect money through separate taxes, assessments, or fees. A county or city can have several special districts in its geographical area. For instance, in Marion County alone there are almost a hundred special districts.
Amy and her team help the many municipalities submit accurate and timely reports. “Our reviews shouldn’t be seen as punitive for those who didn’t meet standards, but rather to help them get it right,” Amy explains. “Reviewing audit reports is great practice for our financial auditors, too, especially as audit and reporting standards continue to change.”
If the municipal audits team finds reporting errors they’ll let the organization know what didn’t go right. Says Amy, “The municipalities don’t always like getting a letter from us with corrections, but the goal is to be helpful. Sometimes we end up getting thanks.”
The state takes this reporting requirement seriously; as of 2015, the municipal audit program will place cities and counties who haven’t filed a report on time on a withholding list. Until they file their reports, these municipalities will not receive 10% of state revenue contributions they’d otherwise collect.
Want to know even more about municipal audits and last year’s summary report? Check out the full report on the Oregon Audit Division website from FY 2016 HERE.