Legislative Joint Auditing
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Representative Robin Lundstrum
Unverified
1:49
Folks let's go ahead and find your seats ladies and gentlemen go ahead and find your seats Legislative joint audit will come to order I need a motion to adopt the minutes from February 13th. so moved you need a 2nd 2. any discussion
all those in favor all those postd right minutes are passed Senator Petty, if you would read our executive committee
Senator Jim Petty
Unverified
2:33
minutes. thank you madam chairir. the executive committee met Thursday March 12,2026 and adopted the minutes from the meeting held February 12,2026.taff reported to the committee the audit and special reports scheduled to be presented to the standing committees and the full legislative joint auditing committee this month. Staff also noted one committee requested report
that is outstanding and currently at progress in new business staff provided information regarding the current caseload assignments to circuit judges in the Benton County 19th west judicial district circuit court with a focus on how cases are assigned and the total number of cases assigned to each judge as requested in the February meeting. The committee voted to have staff review selected cases transferred among divisions and report back to the committee in other business legislative auditor Kevin Whitett updated the
committee regarding the completion of the Arkansas legislative audit financial statements audits for fiscal years 2024 and2025. The audits were conducted by a private CPA firm and the audit reports contained clean opinions on the financial statements and no findings in the reports on internal control with no additional business, the meeting was adjourned. The next meeting of the committee is scheduled for Thursday, June4th,2026 or at the call of the cheers. I move for the adoption of this report. I need a second
Representative Robin Lundstrum
Unverified
3:56
thank youscussion I'd like to make a point of personal privilege here our audit department is tasked with a very important job of making sure that they audit everything and it's all on the up and up and when an outside CPA firm comes in and says all is well that is a great sign for us and it's a great sign for our audit department and I'd like to specially call out Janna Cason, our chief financial auditor iss she in the room she's back over here smiling
trying to hide job well done job well done thank you all right with that all those in favor of accepting this report say aye opposed all right report is accepted or passed next up on deck we have educate or excuse me cities and counties Representative genean to give us our report Thank you
Representative Lane Jean
Unverified
4:54
madam chair the committee on counties
municipalities met yesterday February 1el we approved the minutes the committee also updated the status on the december31st,202022 delinquent private water and sewer audits 21 of these entities turned back funds and were reinstated after all requirements were submitted the committee also updated the status of the december31st,2023 delinquent private water and sewer audits of the64 delinquent entities60 have been
filled their respective reports since the last meeting and it was held on July10,2025. The committee also reviewed 20 deferred reports and 91 current reports officials from seven entities were there to present address for repeat findings3 were previously deferred reports were filed and 17 were deferred of the 91 current reports reviewed 8 were referred to prosecuting attorneys and attorney general and one was certified to the government bonding boardard.
the committee filed 84 current reports and deferred seven reports and I'll answer any questions at this time if not, I make a motion we adopt the report thank
Representative Robin Lundstrum
Unverified
6:14
you any questions all right motion to adopt second all those in favor opposed it's passed all right Representative Duck believe you have an education report. thank you madam chairir. The committee met Thursday March
Representative Hope Duke
Unverified
6:31
12,2026 and adopted the minutes from the ebruary meeting.57ation audit reports were included on the committee's agenda for review. There were52 autumn reports with no
findings and5 auto reports that contained findings the the audit reports for Camden Fairviview, Forest City, and Ettleton school districts contained findings that refer to the applicable prosecuting attorney that were that referred to applicable prosecuting attorney and attorney general the committee moved to defer these three reports to the June meeting so officials from each
school district can be present to answer questions from the committee related to findings in their respective audit reports. The committee filed54 reports and deferred three reports that were brought before it. I moved to adopt this report. thank you senator Love. thank you madamir. I have a substitute
Senator Fredrick J. Love
Unverified
7:22
motion ' ll entertain that motion. I moved to amend
the chair report to file the report presented on the Nettleton school district of
Craighead County and adopt the report as amended. s cu s sion right
Representative Robin Lundstrum
Unverified
7:47
those in favor those opposed all right motion passes. Did we
have a second on that motion all right thank you. Senatorhammer seconded. All right the motion passes. thank you.
the motion passes atdamport passes as amended. thank you. right next up we have Representative Unger state agencies. wo reports with the
Representative Steve Unger
Unverified
8:19
following findings were presented the Department of Public Safety had a duplicate payment to a vendor and insufficient collateral on hand for one of its bank accounts the department of transportation and shared Services made a career service payment in error
had several record keeping issues for equipment, double counted cash holdings failed to record EBd payable property and did not maintain state vehicle logs. various agency staff members were present to report how the agencies intend to address the audit findings and to answer committee questions during the meeting the committee filed5 reports I moved to adopt this report
Representative Robin Lundstrum
Unverified
9:11
Thank you Representative unger I need a motion we have a second 2nd from Representative Ladyium. Discussion those in favor I those opposed all right report passes. Next we have a review of reports from the city of pine bluff. Micchelee Ary actually sorry if you could give us that report thank you madam chairir. This presentation covers the financial audit for
Representative Nicole Clowney
Unverified
9:36
the city of pine bluff for the year ending
December31st of 2024. located in Jefferson County, Pine Bluff is a municipality of the first class with the mayor council form of government Pambla population is approximately39,000. Pine bluff had79 million in total assets and74 million dollars in fund balances at the end of December31st of 2024. the city had almost61 million dollars in revenues and over68
million in expenditures for 2024. The city received an unmodified or clean audit opinion for all three opinion units which include the general fund, street fund and other funds in the aggregate. No deficiencies in internal control were identified in the report on internal control. However, there were findings related to the offices of mayor Parks and redrush director and the finance director disclosed in the management letter.
The cityarks and recreation department oversees and maintains the more than30 parks within the city as well as recreational facilities such as golf courses and RV parks. The department also hosts sporting and community events as well as musical festivals, farmers' markets and other activities. The department has approximately37 employees and the director reports to the mayor. The city had478,000 in parks and recreation fees and almost3.5
million in expenditures as previously stated legislative audit issued two management letter findings. The first finding relates to the mayor and the parks director. This finding has been referred to the prosecuting attorney and the attorney general as well as certified to the governmental bond board City officials brought to audit's attention that they had identified discrepancies in a deposit from the city parks and recreation department. Subsequently our review of
transactions from the parks for the period January1 of2023 through May21st of 2025 identified 179,629 in manual receipts that cannot be traced to the city collector's receipts and deposits. In addition, we noted missing receipts from the parks department's main office, the JColf course and RV parks and no receipts were issued for revenues received from Harbor Oaks golf courseurse.
Therefore, the actual amount of unaccounted for funds could be higher. also there was448,415 an unallowable purchases that consisted of holiday decor, kitchen items, personal hygiene items fashion accessories, gift cards and various electronic devices which 13,000 in questionable purchases that consisted of snacks and officerelate decor and a comparison of original invoices obtained from vendors to
invoices submitted to the clerk's office revealed numerous invoice s were altered to conceal the top of items purchased and the shipping address of the unallowable and questionable items which were shipped to addresses not related to the city we were unable to to obtain the original invoices from two vendors therefore we were unable to confirm if all items purchased from these vendors were for legitimate city business. in addition,5 vendors that were
utilized to purchase questionable and unallowable items were not approved by the city council. Furthermore,3 lawn mowers were not available for audit inspection. therefore we were unable to determine if the equipment is currently in the possession of the city The parks and office manager and the assistant director who were employed when these transactions occurred were terminated in May of last year. These matters are currently
under investigation by Arkansas State Police. the second finding relates to the finance director Accounting procedures procedures for municipalities that are set forth in Arkansas code says the city and the city was in noncompliance with these codes and other proper accounting procedures as noted on the screen. cash receipts journals were not properly maintained and were not reconciled to the total deposits per bank account for all accounts, monthly bank
reconciliations were not performed timely or prepared properly and receipts were not issued for all funds received nor deposited in a timely manner. this concludes my presentation. City officials are present to respond to committee questions. Thank you Miss Ashley. well put together
Representative Robin Lundstrum
Unverified
14:39
all right if I could have the city officials come forward please Mayor flowers, Miss Purdy and Miss Jevers
If y'all could remain standing and state your name and employer and position and I'll swear you in Mayor we'll start with you first, please. if you could state your name and position and if you could state your name please right and could you state your name
please OK I'll swear y'all in do you solemnly swear and affirm that this testimony you're about to give will be the truth and the whole truth and nothing but the truth. thank you if you could be seated we'll start Mayor will
start with you if you have an opening statement you do
Speaker 33
16:05
I first want to say hello to those of you who I didn't get a chance to hug and I miss most of y'all some of y'all are new secondly I I want to say that after serving here for almost 10 years I didn't know that I would ever be or know to feel like to be on this side of the table but I can start off by telling you that in the year
and what two months and 13 days that I have served as mayor I I love it and believe that everything that I did prior to prepared me for this role and what I would like to say in opening as I introduce Miss Devers and then Miss Holeman is that
as this is covering activity in 2024 before I arrived and was sworn in many of these things evolved and were discovered in the very beginning of 2025 particularly with parks and once I appointed the open position of park's director and appointed Miss Holman I think it wasn't even a month
or maybe a little over a month that she discovered some irregularities and took quick action and then we discovered much more even than what you all have seen and immediately called the authorities and met with the authorities as well as a state auditors so that we could make sure that accountability would be
implemented and the main thing that I want to share and then I will pass the mic is I remember from my days on the other side of this table that what we wanted to know and needed to know is that what you all are hearing today won't happen again and that we have taken action to make the appropriate changes and so I'd like you to know that at
the very beginning and even prior to being sworn in one of the pledges that I made for calls from the people was to for the city to invest in the services of an accounting firm for the purposes of a forensic audit and we did do that we secured the services of UHY with offices all over the country based out of Columbia, Maryland that forensic audit
will cover the 2017 sales tax fund activity as well and that's for seven years but it will also cover all of our departments under the mayor's office for two years for the years' 2023 and2024. and I mentioned that because once we discovered these irregularities that what we saw evolved into fraud waste and abuse
we will expand the years for the parks and rec to cover as many years as we've seen there to be irregularities and not only did we confer and hand over everything we could to legislative audit but we conducted and some internal audits before the the firm conducting the forensic audit came on board and so in addition to that we
discovered that there were not centralized and documented standard operating procedures across all city departments they're obviously would be some for police department and fire but in many other departments those just didn't exist and so we have consulted with a professional consultant to help us establish
a framework for that work and and that will include the finance department even though there are some standardized operating procedures that are documented having a full body and breath across the dynamics for every department is what we're aiming for we also didn ' t have a procurement director when I came on board and that's something that we put and got approved for in the
budget for this year and once the consultant that we've hired to complete the asset inventory is completed and of course we we have inventories but not as I think complete and certainly not centralized and and it's not an inventory with a threshold that begins at500 dollars which is where we'll be begin I believe the threshold for the existing inventory that
the legislative audit has been reported from the various departments starts at $2000 if I'm not mistaken. and then we passed some legislation in the last year that we're really proud of. We changed it so that the the budget amendments which didn't fall under resolutions now are required to
be filed as a resolution so that they can be public and go through a more rigorous vetting process and a more public process we also passed legislation requiring resolutions and ordinances that include any funding to in the resolution or ordinance disclose the funding source so that we are not passing legislation where we don't know where the funding would come from and then we passed also passed
ordinances that would allow our city to pay our bills and vendors electronically and we passed legislation that would allow the city collector's office to deposit checks electronically. the other thing that I would like to note is that we are in what I would say is going to be a pretty long and protracted process but it'll be worth it the previous administration invested in the transition of
our software system which really undergirds everything we do financially and with regard to HR and and we had to do that that's something that we discussed during transition and the current company we with we are with which is New World is was bought out by Tyler Technologies so we're undergoing that process as well we
completed our first year and we'll go live for our finances and anticipate that there will at least be another year to year and a half years before the three phases will be complete with that I would like to introduce finance director Gina Devers to speak to the issues that pertain to her department and then you'll hear from
Prudyholman and then we'd be open for any questions that
Representative Robin Lundstrum
Unverified
24:36
you might have Mtevers if you could keep your
Speaker 36
24:43
comments not short but just clear thank you in reference to the finance department, I think the mayor pretty much covered most of it when she spoke we are working on the standard operating procedures which we did have some in the finance department but since everything in other
departments involving money flows up to the finance department those procedures are being implemented and documented across all the departments. So in the event that someone leaves unexpectedly in another department it won't end up affecting the finance department. there will be a book that the new people can refer to and just keep things going as for the receiving and the
depositing timely we are have implemented a three dayy rule and if I receive a check on Monday, I have until Thursday to get it deposited mait thank
Speaker 39
25:56
for parks and recreation as mayor mentioned as soon as I took on this position is when
I discovered the irregularities and so I immediately started to just if you could lean into your microphone immediately just started to kind of investigate and see what was happening and what we could do to make it better actually so just for the re ce ding we are using or utilizing our new world system eliminating any manual receipts this receipts the customer
immediately and once we entered that information into the system then it's it's there I can't do anything to change it they're receipt it and so those funds have to be taken over to the collector's office I also when I established the paydagov for uharks and recreation. so now we have the QR codes in the windows we eliminated cash at the RV park so there is a posting of where they can you know scan the QR code and make
the payment or they can come to the office and immediately get a receipt what else? the the SOP is in place for the receding so the adminis the office manager and the adm man they've been trained on how to utilize new World and if they forget then I have the standard operating procedures posted there that they can always refer back to
and as far as the equipment only designated individuals are in charge of the equipment so they're responsible for inventory and that at the end of the day making sure everything is returned to the park in the maintenance shops at the end of the day and I think that covers just about everything so thank you Miss Holman youuess
Representative Robin Lundstrum
Unverified
28:01
from the audience Representative ladyman
Representative Jack Ladyman
Unverified
28:10
thank you madam chair. well thank you all for being here and Mayy Flarere you and I had a mayor
to mayors meeting about four months after you were in office and and you know I know you had a lot of challenges and you were working on those then and and you and I didn't always agree here on bills we had a few discussions but I know though but you know I always knew that your heart was in the right place and you were doing what you thought was best for your people and I think you still do that and some of the stuff
that you presented is really good. I mean it sounds really good but my well it really a question for Miss Holeman do y'all have any other cities have their challenges in parks including my city. do you have any nonprofits that work hand in hand with your parks and pri ma ri ly your wreckx and where there's cash flow, you know if you have any of
those, are you monitoring any how they handle money because that can be a big issue because they're not keeping good receipts and maybe they just send the money to you if you don't have any then you don't have that issue but do you have any nonprofits that work with yourark's recreation. Um, no
Speaker 34
29:28
sir, nothing that is like a formal partnership where we're besides boys and girls club and
Speaker 48
29:33
yeah 8 but they don't handle money well that's just something that you know you might need to be
Representative Jack Ladyman
Unverified
29:43
aware of and there's issues related to that but I think some of the things y'all put in place your system it that you have mayor your tracking system, your software is that what the municipal league loses uses or is it a different type a lot of times the municipal league can help you with those
Speaker 33
30:05
systems they they have always been helpful and yes they're very sophisticated
systems that other cities in Arkansas as well as across the country used and Tylerchnology actually and we learned this during the transition Tyler technologies actually specializes in municipalities and school districts and it's it's it is a heavy lift to make this transition but we hired a project manager who has experience in change
management and software training and she's been amazing in helping us get ready to go live. so well I know you got a lot of work to do and
Representative Jack Ladyman
Unverified
30:52
hiring a consultant outside to help I think it's a great step forward so thank y'all for being here thank you so much
Representative Johnny Rye
Unverified
31:05
thank you uhpresentative Rye Mr Chairman maybe it sounds like that Mayor Vivian it's not so much that you have theft here is you don't have a
system or you didn't when you came into office that actually you could track things day by day to know where you were financially within that organization is that kind well no I would
Speaker 48
31:28
say that that I mean the tracking system
Speaker 33
31:32
was there we are just in in a as far as you're talking about with Parks and rec I mean honestly that is just human fallibility and people taking advantage of the position
they were in and thank god that we had someone who was observant and you know help the process accountable and help the people working for the department accountable and thinking in your report you'll see that there are two people who had direct access and were responsible for the activity that was discovered were terminated and the information was handed over to the
authorities and I think for what wasn't being done or what could be done better is what we've tried to do to enhance the system that we have we had a good system in place just maybe people not operating honestly and
Speaker 51
32:31
above board unfortunately thank you thank you that was a great explanation and appreciate you
Representative Johnny Rye
Unverified
32:37
and sure it's good to see you again Mayor what I appreciate most is you didn't try to cover it up or
Representative Robin Lundstrum
Unverified
32:49
hide it you dealt with it straight on and called it for what it is it's plain old theft people in trusted positions stole from the city of pine Bluff. is prosecution
Speaker 33
33:05
say prosecution is being pursued we have met with the prosecutor's office as well as state police and our own police department and I believe that that that the status is still in investigation under the state police. thank
Representative Robin Lundstrum
Unverified
33:20
you do we have any other questions
for members? seeing none all right do I have a motion to file this
report a second just second thank yous discussion all in favor opposed all right motion
Speaker 57
33:40
passes. thank you thank you committee I hope not to see you again next year. thank you mayor that that's condolences are extended. all right
Representative Robin Lundstrum
Unverified
33:53
the next meeting will be June4th and5th of 2026 and seeing
no new business we are ad
Agenda
A. Call to Order by Chair
B. Adoption of Minutes
C. Reports of Executive and Standing Committees:
1. Executive Committee
2. Counties and Municipalities
3. Educational Institutions
4. State Agencies
D. Review of Report:
City of Pine Bluff – Regulatory Basis Financial Statements and Other Reports – December 31, 2024
E. Other Business:
The next meetings of the Legislative Joint Auditing Committee will be held June 4 and 5, 2026.
F. New Business
G. Adjournment
Documents
| Title | Type | Pages | Source |
|---|---|---|---|
| Agenda — LEGISLATIVE JOINT AUDITING, Mar 13, 2026 | Agenda | 1 | Official source ↗ |
Speakers
Representative Robin Lundstrum
Unverified
Senator Jim Petty
Unverified
Representative Lane Jean
Unverified
Representative Hope Duke
Unverified
Senator Fredrick J. Love
Unverified
Representative Steve Unger
Unverified
Representative Nicole Clowney
Unverified
Speaker 33
Speaker 36
Speaker 37
Speaker 39
Representative Jack Ladyman
Unverified
Speaker 34
Speaker 48
Representative Johnny Rye
Unverified
Speaker 51
Speaker 57