Pender Finance Director resigns amid audit concerns

Published: Jul. 25, 2014 at 6:09 PM EDT|Updated: Jul. 29, 2014 at 6:09 PM EDT
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Claiburn "Butch" Watson resigns effective August 1.
Claiburn "Butch" Watson resigns effective August 1.

The Pender County Finance Director, Claiburn "Butch" Watson has resigned effective August 1, 2014.

Watson went took leave starting July 7 and will stay on leave until his resignation becomes effective, according to Bob Murphy the Interim Pender County Manager. Murphy said Watson announced his decision earlier this week.

The reason for Watson's resignation is still unclear, but it follows growing concerns county leaders have with the audit for FY 2012 – FY 2013.

According to the Chairman of the Board of Commissioners, David Williams, the audit should have been turned in back in October, but a draft of the audit was not turned into the Local Government Commission until this past week.

Williams said when he asked former County Manager Mickey Duvall and Watson about the late audit, he was told it would be turned in soon and the Local Government Commission was aware of the delay. Williams said he learned earlier this month, after receiving a letter asking where the audit was, that was not the case.

Soon after, Rick Benton was brought on as a consultant at $175 an hour to help finish the audit as quickly as possible and ensure the same issues would not happen in future years. Days later, Bob Murphy, was brought on to also serve as Interim County Manager at $65 an hour.

A draft of the audit now has been turned into the Local Government Commission, but the agency still needs to sign off on it.

The draft of the audit sites several mistakes made by the finance officer, under the Material Weakness section. Murphy said the weaknesses are very significant and serious; they deal with financial operations and processes. He said county leaders were very disappointed and that they are committed to correcting the weaknesses quickly.

One of the weaknesses outlined deals with the reconciliation with records. It states: "The finance officer failed to perform his duties. His assumption was that it was being prepared by other staff members and he did not follow up on his duties." As a result the audit states: "This indicates that management may not have had accurate information to base decisions on in conducting business for the county."

Murphy said that when Benton was brought on to finish the audit an outside accounting firm had to be consulted to help with the reconciliation of records, something Murphy said is not normal.

In another portion that deals with recording the proper budget amendments, the audit stated: "The finance officer did not reconcile and review the records, which would have indicated that there were budget amendments that were not posted, or that there were additional budget amendments needed."

Murphy said both weaknesses are serious when it comes to financial processes and will be corrected.

On another level, he said the audit reflects that the county is in good financial shape, and that there is a good fund balance.

"I'm sorry these material weaknesses take away from that part of the audit," Murphy said.

Murphy said since FY 2013 – FY 2014 year has already ended, and Watson served as the Finance Director during that time, he would expect similar issues dealing with financial operations in that audit as well.

He says everyone is working hard to make sure similar issues do not continue during the current fiscal year, FY 2014 – FY 2015.

Murphy also said the county is working on hiring a new Finance Director. Mike Apple began working as Interim Finance Director on July 23 at around $60 an hour. Murphy said now that he has been hired, Benton will work to scale back his hours.

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