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North Miami to open its books for a state audit

North Miami is seeking outside help through a state audit of their past processes to see where and when there might be discrepancies.

The Florida Joint Legislative Auditing Committee approved North Miami’s request for an operational audit of the city at a Feb. 16 meeting in Tallahassee.

The state auditor general will focus on four departments: finance, building and zoning, purchasing and public works. The audit would look at the city’s financial records, expense reports building and zoning records, vendor-related party review and approval safeguards and any irregularities.

City Manager Aleem Ghany said the years the audit will focus on and the scope of work will be determined when city staff meets with the auditor general.

“The objective is to find any opportunities to improve and to make things more efficient,” Ghany said.

If the auditors suspect any fraud or deficiencies after completing the audit, they will report it to city leaders and the applicable law enforcement agencies.

North Miami will pay for the audit, including paying half of the cost before the work starts. Ghany said the exact cost will be finalized when he meets with the auditors, but he estimated $70,000 to $120,000 based on similar audits in other cities. The city budgeted $200,000 for the costs of an in-depth audit in this year’s budget.

The city began exploring a more in-depth audit last summer and council members voted 3-1 in July to pursue an in-depth audit. Councilwoman Marie Steril voted against the item.

This upcoming audit is separate from the ongoing IRS investigation of the city that began last September. Earlier this month, the agency asked for additional documents including records of payments that were categorized as insurance stipends and health insurance reimbursements.

The IRS examiner initially requested documents including correspondence between the IRS and the city about payroll taxes, employee contracts in force during four tax-return periods in 2012, copies of all retirement-plan documents, a list of fringe benefits provided to employees and the city's personnel, policy or procedure manuals.

The agency also requested year-end payroll summaries and accounts payable records for two employees who were apparently acting as independent contractors.

Ghany said the state’s operational audit is another step in developing a “clean slate” for the city beyond the scandals in recent years.

Vice Mayor Carol Keys, who sponsored the item asking for an in-depth audit, said she was happy and optimistic about the state audit.

“Our regular auditor only looks at what we provide them,” Keys said. “We need someone to come in and look at our books and tell us what they want to see.”

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