SUBMITTED
The Township of Lanark Highlands is taking several steps to address issues related to municipal audits, a 2024 budget insurance error and upcoming financial challenges for 2025.
The township’s new treasurer, Rhonda Whitmarsh, started in the position on Nov. 4 and will be the lead in completing the 2023 audit and addressing any outstanding recommendations from management letters for 2022 and 2021. “Rhonda brings more than two decades of experiences as a municipal treasurer and is also a Chartered Professional Accountant,” explained CAO Suzanne Charbonneau-Dent. “The content of previous management letters was not publicly released as it included sensitive issues that could pose security issues for the township.”
In addition, in the 2024 budget, an error was made that inadvertently doubled the actual required amount for the township’s insurance. The township electronically paid the $146,774.40 amount shown on the physical invoice, but due to a change in the broker’s banking information, it was not received, resulting in a second payment being issued correctly. The entry for the return of the initial undeliverable funds was not recorded in the township’s financial software, however; and Whitmarsh discovered the error in early November.
“It appears that when subsequently preparing the 2024 budget earlier this year, staff used the amount shown in the financial software, which reflected the two payments made, but not that one payment did not go through,” Charbonneau-Dent said. The township has the ability to set aside the remaining unspent amount of $146,774.40 in reserves to offset future expenditures.
“The 2024 tax rate was set using the higher insurance figure, and this will not be mirrored in the 2025 budget,” she added. The savings will be available to assist with addressing financial challenges in 2025, including a large forecasted OPP billing increase, aging infrastructure and asset management obligations.
Charbonneau-Dent said staff involved with the 2024 budget insurance mistake are no longer with the township, but they had worked diligently to catch up, particularly on the financial side, during a period of staff turnover and shortages in recent years, often taking on extra duties. “This has been part of the
challenge, but we take ownership for the error and recognize the impact it had on the 2024 budget and tax rate.”
“I value the dedication and professionalism of our township staff,” said Reeve Peter McLaren. “Mistakes can happen to anyone. Our staff have been operating in a catch-up mode with each performing multiple jobs to get caught up. I am extremely proud of this over-the-top effort by all our staff.”
Additional steps being taken include:
- The new treasurer will be conducting internal audits and reviews of financial transactions and internal controls, and any findings of concern will be brought to the attention of council.
- Completing a detailed assessment of the financial impacts of asset retirement obligations that are required to complete the 2023 audit. The township anticipates awarding a contract to complete these assessments by Nov. 28, 2024.
- An RFP for audit services for 2023 and 2024 was issued on Nov. 19 and is expected to be awarded in January 2025. Timelines for completion will be confirmed with the selected auditor.
- Department managers have started preparation of the 2025 budget, and the process will begin in January.
“Lanark Highlands is turning a corner,” Reeve McLaren said. “We have good staffing in place with the key positions of CAO, Clerk and Treasurer filled, and they are working to get things back on track and get up to date on our finances. We understand the importance of transparency and will be working diligently to keep our ratepayers informed.”
