Government

‘The Right Foot Going Forward’: Audit Committee, Interim CFO Praise Finance Department’s Work

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New Canaan for the first time since forming an Audit Committee to ensure proper financial controls are in place is no longer operating with “material weaknesses,” a member of the group said Wednesday morning. The town also has given full access to its elected treasurer and “we don’t have people signing checks that are unauthorized to sign them,” Audit Committee member Ed Kangas said during the group’s regular meeting, held at Town Hall. “It’s almost incredible to me that we had all those problems. These were big deals. This town should not have had those problems. I am pleased they are resolved and we are off on the right foot going forward.”

The comments came on the first meeting of the committee since New Canaan hired a new interim CFO, whose predecessor retired amid lingering “material weaknesses” in town financial processes and controls that had been identified by auditors. Tom Stadler, administrative officer in the office of the first selectman, said last week was busy at Town Hall with the former CFO’s “departure” and new interim hire Sandra Dennies’s start “and the walkthrough and changeover of the bank and investment accounts, and a number of other things,” adding that officials have put those matters “behind us now” to move on and “walk hand in hand.”

Referring to concerns that had been raised by the town treasurer, Audit Committee Chairman Bill Parrett said: “I understand there has been lots of activity in terms of giving the treasurer access to some of the accounts—maybe they were not the biggest or most important accounts—but they were accounts that he presumably should have been looking at, and that has been done.”

Dennies in brief remarks to the committee offered praise for her colleagues in Town Hall and in the finance department specifically.

Government

‘A Much Better Understanding of the Yin and Yang’: Selectmen Support Audit Committee Appointments

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Saying that his relationship with the Audit Committee has improved significantly in the past few months, New Canaan’s highest elected official and the Board of Selectmen on Tuesday supported the reappointment of one committee member and the appointment of one new member. First Selectman Rob Mallozzi called prospective new Audit Committee member John Lanaway’s resume “unbelievable” and noted that his predecessor in the group, Janet Lanaway, “was there for some of the turmoil.”

“I have noticed in my dealings with the Audit Committee in the last three or four months, on my level, a much better understanding of the yin and yang of at least my role and [Town Administrator] Tom [Stadler]’s role and [Finance Director] Dawn [Norton]’s role and others in municipal government, and I have found that it has been a much different attitude—on my part, quite frankly, because I was hesitant about the Audit Committee,” Mallozzi said during a Board of Selectmen meeting, held at Town Hall. “So I can say I am feeling that there has been a change in the attitudes and I think a lot of it had to come from the top, and I take some responsibility for that, as well, and most recently in their help in trying to lay out what we are looking for in an internal auditor or controller, they have been much more user-friendly. I am happy to report that.”

The comments come a few weeks after the Audit Committee voted to recommended that the Town Council accept last fiscal year’s financial statements. Last fall, the Audit Committee temporarily suspended its work, surprising and causing consternation for many in town, pending the adoption of some course-correcting measures that the group had drafted.

Government

‘I Think We Are Getting Close’: Audit Committee Details Course-Correction Plan

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The independent auditors who sign off on the town’s financial statements—helping New Canaan maintain its AAA bond rating and fund major capital projects such as the Town Hall expansion and proposed building project at Saxe—need better internal controls in order to do their jobs responsibly, officials said Monday. Auditors don’t actually “do real auditing,” but rather “rely on systems of internal control” in reviewing New Canaan’s financial statements, according to Audit Committee member Ed Kangas. And those systems themselves need substantial changes and shoring up, he said during a meeting of the Audit Committee, held in the Training Room at the New Canaan Police Department. Because towns in Connecticut are set up where the municipality funds the schools, distrust between the two can develop and “I see it in spades here,” Kangas said. “I think we are getting close to the place where we have an understanding that says we have to have good financial systems, good financial controls, good checks and balances.

Government

‘Simply Inadequate’: Audit Committee Cites Poor Town-Schools Relationship in Suspending Its Work

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Saying they don’t want to be associated with New Canaan’s financial statements, members of a committee that town officials appointed last summer in order to help oversee financial reporting for the municipal government and school district said late Tuesday that they’re suspending their work. The five members of the Audit Committee, including two alternates, said in a letter sent to the first selectman and Town Council that they “have no reason to believe the systems of internal control at both the Town and the Board of Education are adequate nor have recommended improvements been implemented.”

“Communication between the finance department of the Town and the Board of Education has not been adequate. This has resulted in un-reconciled accounts dating back several months. In addition, the Town CFO’s access to the Board of Education books and records, accounting and control systems, is not at an appropriate or adequate level. Without resolution, this would likely prohibit the Town’s CFO from making required representations regarding those controls and records to the Town’s external auditors.”

The committee will cease its activities Nov.