The Jackson City audit committee met to review the city's recent external audit findings and to discuss a plan of corrective action intended to address long-standing accounting and control weaknesses.

Nathan, who presented the department's response, said the audit report includes items on cash reconciliations, revenue recognition and legacy system transitions. "Timely cash reconciliations are key to our operations of financial reporting," he said, adding that historical practices had included backdating July and August transactions into June and that the city's prior software had not been used to record those events properly. Nathan said the new Tyler system and an engagement with longtime consultant ATA will help standardize processes, speed reconciliations and provide training and independent review.

The presentation covered several categories of findings. Nathan said payroll accruals and a few benefit accruals will still require manual handling, but most accruals should be supported by the upgraded system. He also described interfund balances carried on the balance sheet that were remnants of a manual "pooled cash" workaround; staff plan to enter adjusting journal entries for FY24 and clear those balances in FY25. On federal recovery funds, Nathan noted prior reporting used encumbrances instead of expenditures and that beginning in October the city is recording actual expenditures to comply with CSLFRF reporting requirements.

An internal-audit representative said the committee's plan of corrective action will serve as the audit roadmap. "The plan of corrective action is pretty much our roadmap," they said, and added that once the corrective plan is completed, the internal auditor can schedule routine reviews, test accruals, and evaluate segregation of duties and other controls.

Committee members pressed on process and capacity. One member asked whether the internal audit office could review everything before the external auditor; the internal auditor and staff said internal audit focuses on policies, processes and targeted sampling rather than every transaction, and that a comprehensive review of all revenue streams would require a larger team. Nathan and others recommended assembling an updated internal-control manual (dating from roughly 2009111 in some municipalities) and annually evaluating it so controls match current operations.

Members also discussed short-term and near-term priorities: formalizing random-sampling routines (Monica was cited as performing some sampling today), clarifying purchasing controls (purchase orders and required documentation for items over $2,000), and examining department-level policies for cash handling at decentralized revenue points (ticket booths, gift shops, concessions). Nathan said the city is considering a lockbox option to handle peak property-tax intake periods and will continue cleanup work ahead of formal closeout dates.

On budget-eye issues, Nathan warned that achieving a "clean audit" will be multi-year work. "We didn't get here quickly and we're not gonna get out quickly," he said, and set realistic expectations that meaningful progress may take through FY26 and into FY27. The committee asked staff to bring a work plan and calendar for staged reviews and to return with clarifying materials at the next meeting.

The meeting closed after members discussed job descriptions and staffing needs for internal-audit functions and the potential to contract services for peak workloads. A motion to adjourn passed and the committee adjourned.