FONDA – Members of Montgomery County’s Finance Committee met Tuesday to listen to a presentation regarding an audit.
Shawn Bowerman, the county’s treasurer, had asked the committee to have Tim Thomas and Joe Klimek from Toski & Co. talk about the audit before the Board of Supervisors finalizes the 2014 budget.
Thomas and Klimek audited the financial statements of the county for the year ending Dec. 31, 2012. The pair developed recommendations on accounting and administrative matters from the work.
The recommendations, which were discussed in a letter, include having the county perform a capital asset inventory, which would include infrastructure and valuation. The inventory would help the county record and depreciate its capital assets, the letter said. The inventory also would help the county when trying to get a loan, the letter said.
Klimek and Thomas also recommended the county consider including Local Law No. 4, which provides health insurance benefits to its retirees, in its union contracts.
“It spells out the fact [the county’s] retirees are getting health insurance when they retire and that’s in the local law, but each collective bargaining agreement should reference that local law,” Klimek said.
The pair also suggested the county implement the requirements of the Governmental Accounting Standards Board Statement No. 45, which regards the accounting and reporting of post-retirement benefits other than pensions. Klimek said those benefits include retirees’ health insurance and any kind of a county-sponsored health insurance program.
“This managing report [GASB Statement No. 45] will open your eyes up,” Klimek said. “What is that liability right now? There is a huge liability that all of our counties are recording relating to [retiree health insurance.]”
The final recommendation was for the county to record each department’s health care costs as they are being determined by the third-party administrator annually, and to record these costs to each department’s health benefits general ledger.
Currently, the county only records its health care costs in one general ledger account.
Recording each department’s costs will “allow each department the ability to capture the direct costs associated with both its active and retired employees for both budgeting and actual costs.”
The committee said it will take the suggestions into consideration.