In the interest of financial transparency, we'd like to note that the City Council (led at the time by Mayor Jon Ball, Council President Kathy Nuckles and Administrator Tom Corrigan), never published results of this Audit in the City's official meeting proceedings, never published a copy of the Auditors letters to management, and never mentioned that the audit included over $1.6M (positive) restatements to the City's General Fund.
Click here to read more coverage on financial transparency related to the windfall.
On January 5th, 2026, SCM filed a public records request with the City of Shady Cove to get copies of the Auditor's formal letters to management on Internal Controls. Interim City Administrator John Edwards informed us that he could not locate these letters, which date to February 2024. We find this concerning, since the City should be retaining a copy of all records related to the Audit. However, we found that in the May 16th Council meeting, then-Council President Nuckles read aloud from the letter.
(You can find the discussion at approximately 56:08 in the audio recording, linked here: 051624 City Council Regular Meeting - City of Shady Cove, Oregon ) Councilor Nuckles reads the following paragraphs from the Auditor's letter to the Council.
“Executive Summary. We have completed our audit of the Shady Cove City for the fiscal year ended June 30th, 2021. This letter communicates our audit conclusion which is a disclaimer of opinion on the financial statements of the City for the mentioned period.
Background: An audit aims to provide reasonable assurance that the financial statements are free from material misstatement and present fairly in all material respects the financial position of the company. Our audit was conducted in accordance with Generally Accepted Accounting Standards and Oregon Minimum Audit standards.
Basis for disclaimer of opinion. A disclaimer of opinion is issued when we are unable to obtain sufficient, appropriate audit evidence on which to base an audit opinion, and we conclude that the possible affects on the financial statements of undetected misstatements, if any, could be both material and pervasive. In the case of the City, the disclaimer was necessitated due to the following reasons.
The City Staff were unable to locate and provide documentation and information that Isler requested. Several factors contributed to the situation including significant turnover in staff during COVID-19, the disorganization of digital and physical records related to 2021 and limitations of financial resources, limiting current staff’s time and capacity to locate the data.
Implications. A disclaimer of opinion indicates that users should exercise caution when relying on the City’s financial statements for the fiscal year ended June 30th, 2021. It does not necessarily imply wrongdoing but highlights significant uncertainties around financial information.
Recommendations. To address issues leading to this disclaimer of opinion, we recommend the following steps.
They, City, should try to get the financial records better organized. In addition, the City should make an effort to find competent people to help them in their accounting department.
Next steps. We are committed to assisting the City in addressing these issues. We suggest a meeting to discuss our findings in detail, plan the implementation of our recommendations, and explore ways to prevent such occurrences in future audits.
Conclusion. We appreciate the opportunity to serve the City and are dedicated to providing value through our Audit services. We look forward to your cooperation in resolving the issues highlighted and enhancing the reliability of future financial statements.”
Note: Bold and Underline emphasis added by SCM.
Paid for by shady cove matters political action committee
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THE CITIZENS OF SHADY COVE HAVE SPOKEN!!! We were notified on June 10th that Jackson County completed the signature verification. As we already knew, there were enough signatures to proceed with the recall. Mayor Richardson will have till June 15th to decide to resign or make the decision to have the City hold an election. We await the City's response.
It's time for new Leadership. Learn how you can support the recall effort.