An annual review of Grays Harbor PUD finances and accountability by the Washington State Auditor’s office contained no material findings for the year 2016.  Although there was a single finding on the annual report. Communications Director Ian Cope said in a press release that the final report was delivered to the PUD Board of Commissioners and staff last week and concluded that the District “has good controls and procedures in place for accountability areas that (were) audited.”

The finding states that “The District’s internal controls over the accounting and financial reporting were not sufficient to ensure financial statements are accurate and complete.” The state later admits that the standard is being updated and a quick search of annual audits shows the issue has prompted several findings in audits just this year.

The PUD’s finding statement continued “The Governmental Standards Accounting Board issued Statement No. 45 in 2004, which required local governmental employers who provide other post-employment benefits (OPEB) to recognize and display OPEB expenses and related liabilities (assets), note disclosures and RSI in their financial reports. This is a multifaceted standard that is currently being updated which adds to the complexity of these reporting requirements.

The District lacked an effective preparation and review process to ensure the accuracy of the financial statements. Specifically, the District did not accurately report Other Post Employment Benefit (OPEB) balances.

Cope added in his press release, “In addition, the auditor found the utility financial statements fairly represented the financial position of the PUD and were ‘in accordance with the accounting principles generally accepted in the United States of America.'”

While the review delivered a clean opinion of utility finances and accountability, a finding was noted by the Auditor related to the reporting of post-employment benefits which resulted in a deferred debt balance but did not impact utility cash balances.

“This finding centered on the application of an accounting principal the utility had been making consistently for eight years,” said Chief Financial Officer Kathryn Skolrood.  “Once discovered, we immediately corrected the error, a fact for which the Auditor commended the District for in the Audit Exit Conference.”

The PUD said in their reply to the state, “The District agrees that it did not handle the application of the accounting principle accurately. The error resulted in a deferred debit balance on the financial statements, which did not affect cash. Corrections have been made and no further corrective action is necessary.”

In the concluding statement, the Auditor found that “District operation complied with applicable requirements and provided adequate safeguarding of public resources.”  The report also found that the utility was in full compliance with state laws and regulations and its own internal policies and procedures in the areas examined by the state.

“I am very proud of our staff for the work they put into this report.  The state’s findings tell our employees and our customers that their utility is in good hands and that the public trust in their PUD is well placed,” said General Manager Dave Ward.