Treasurer Mark Woods told the auditor “he does not make journal entries.”
A state Comptroller’s Office auditor has expressed concerns that Dunkirk can’t live up to the responsibilities of its Fiscal Recovery Act. She also said the city could run short on cash as soon as October.
Melissa Myers is chief of municipal audits for the Buffalo regional office of the Comptroller’s Office Division of Local Government and School Accountability. That’s a mouthful — and what Myers had to say in her Sept. 5 letter to Mayor Kate Wdowiasz probably made Dunkirk officials feel like spitting something out.
“In sum, we determined that the city’s records were not accurate or up to date,” Myers wrote. “Unless city officials take prompt steps to ensure that proper and accurate financial records are prepared, we may be unable to make meaningful, if any, budgetary recommendations.”
She went on that based on auditors’ examination of bank records and other information, “we prepared a projected cash flow analysis and determined that if current spending trends continue, the city could begin experiencing cash flow shortages as soon as October 2024.”
Myers went on to say an Aug. 16 cash flow analysis by city Fiscal Affairs Officer Ellen Luczkowiak was “not current” and used “unreliable data.”
According to Myers, Luczkowiak’s analysis included payments of $4.3 million to the state retirement system and $840,453 to the Dunkirk City School District — but the payouts actually never happened.
“In addition, payroll figures included in the analysis do not agree with payroll data entered into the general ledger,” Myers went on.
She called on the city to reconcile its bank balances with the totals on its City Hall ledgers. There’s a hint of internal disorganization and dissension: Myers wrote, “The Fiscal Affairs Officer indicated to us that the Treasurer (Mark Woods) makes erroneous general ledger entries causing the Fiscal Affairs Officer to have to enter offsetting journal entries. However, the Treasurer told us that he does not make general ledger entries.”
Myers also stated auditors requested, but did not receive, an accounts receivable report and reconciliation for 2022 or 2023. She later urged city officials to make accurate and up-to-date records a priority.
“In closing, given the current state of the city’s accounting records, we are concerned that the city will be unable to comply timely with its mandated responsibilities pursuant to the act,” Myers wrote in her penultimate paragraph. She demands “accurate and up-to-date quarterly reports for the current fiscal year or a copy of the city’s independent audit report for its last completed year by Dec. 31, 2024.”
Wdowiasz was asked Thursday afternoon to comment on Myers’ letter, but did not do by early Friday afternoon.
Dunkirk has been facing a fiscal crisis since March when city officials noted the municipality was running low on cash to run its $26 million operation. In the summer, council approved a loan totalling $16 million from New York state that needs to be paid back.
At the moment, those monies appear to be fleeting.