Kalispell dinged for credit card controls

The city of Kalispell is asking its employees to provide original receipts for any and all purchases made with the city’s credit cards after an auditor found that policy was not always being followed.

A fiscal year 2012 audit by Denning, Downey and Associates examined credit card claims from the months of April and May and found seven out of 25 claims did not have the appropriate supporting documents.

The Kalispell-based accounting firm cited the lack of receipts and the city’s inconsistent adherence to its own credit card controls as a “significant deficiency.”

That finding does not rise to the level of a material weakness but is a finding “important enough to merit attention by those charged with governance,” the firm said.

It was the only deficiency identified in Kalispell’s annual financial report. The 178-page document was published Monday, Dec. 31.

“You always strive to not have any findings, but if you look at most cities you’ll find the auditors usually find something,” said Rick Wills, Kalispell’s finance director.

Wills said credit card claims totaled roughly $12,000 per month in April and May.

About $2,000 in credit card purchases during those two months lacked original receipts.

About $1,500 of that total was attributed to a city credit card used by the Kalispell Business Improvement District.

Kalispell officials also failed to get original receipts for the city’s $49 monthly payments to PayPal. The city uses that service to help process credit card payments from water and sewer customers.

Another credit card purchase without a receipt in the two-month time frame was attributed to fire department fuel purchases for a training exercise — an expense that was later signed off on by the fire chief.

Kalispell City Manager Doug Russell said he appreciates the scrutiny the annual financial audits provide.

He also stressed that none of the credit card purchases in question were unjustified purchases, only purchases for which an original receipt was not provided.

“It’s just one more reminder that, hey, it is important to close that loop on every purchase we make,” Russell said of the need for Kalispell’s employees to provide original receipts. “And not just with credit cards. We want to reinforce that with all purchases that are made, to make sure we have that complete circle.”

LAST YEAR’S financial audit identified two findings of significant deficiency.

The first related to Kalispell’s parking commission.

Auditors found no review or oversight mechanism to ensure that all parking tickets issued and all money paid to the commission clerk were entered into the system.

A second related to the city’s ambulance fund.

Auditors found that Kalispell was mistakenly overstating accounts receivable for the ambulance fund, failing to write it down to account for ambulance bills the city did not expect to see paid.

Both deficiencies were found to be corrected this time around.

“That’s what the audit is for,” Wills said. “I invite the audit because it helps us clean things up.”

Reporter Tom Lotshaw may be reached at 758-4483 or by email at tlotshaw@dailyinterlake.com.