FY2022 Auditor Findings, Copy of the Official Audit

In the interest of transparency, SCM notes that unlike the prior audit, the FY2022 Audit was discussed in the City Council's March 6th Council meeting, and the audit itself was published in the meeting's online agenda.  Link to the Council Meeting:   3-6-2025 City Council Regular Meeting - City of Shady Cove, Oregon 

SCM would like to note that there was no detailed discussion of the many adverse findings in the Audit.  Nor was there an attempt to prepare an Audit Action Plan, despite what appear to be serious shortcomings. 

The brief discussion of the audit was led by Mayor Ball and Council President Nuckles.  They stated that 

• The audit had to be "worked up to a disclaimer" [as compared to an Adverse audit finding, which can impact the City's Credit]
• That the audit took a long time "because we had to keep working to a point where they [the Auditor] felt comfortable with the disclaimer."
• They said the Auditors "haven't detected negligence on our part, they just couldn't verify some things, but they couldn't detect negligence. Which is what an Adverse Audit would have been."

What is truly remarkable about this recorded discussion are the references to "working up to" and "feeling comfortable with" a disclaimed audit. What this actually means is that the Auditor was considering an Adverse finding. Adverse audit findings are typical when there is evidence of fraud and/or evidence of material and pervasive misstatements.   We have -- so far -- found three audios which discuss Auditors looking possible fraud and/or negligence.  

• You can listen to an audio of this discussion below. 
• You can listen to a discussion from April 2025 linked here .
• The other reference is not being released publicly at this time. 

It does not appear that the Mayor and Councilor President Nuckles had detailed discussions with the other Council members regarding the possibility of an Adverse audit, or for fraud/negligence concerns, during the period when work was actively proceeding on the audit.  The only discussion happened when the final Audit was released.  (We confirmed this with Councilor Paige Winfrey.) We find it concerning that other Council members weren't fully briefed, especially in lieu of the disclaimed prior audit. 

Note: During the audit discussion, Mayor Ball also directed Administrator Parry to find a new auditor, in the hopes that subsequent audits could be completed faster.