Indian Hills reopens books for forensic accountants

A request to delve deeper into a forensic accounting of the Indian Hills General Improvement District's books was narrowly approved by trustees.

Board secretary Bill Eisele said he wanted to continue the study conducted by the accounting firm of Muckel Anderson and covering the period between June 2006 and September 2008.

"I'd like them to look at two or three things," he said. "My feeling is that we owe it to taxpayers to clean this up."

Newly hired General Manager Jim Taylor said many of the concerns in the report have been corrected.

According to the report, accountants found "accounting records and supporting documentation for the period ... incomplete and hard to find."

Among the concerns noted by the accountants were a lack of controls over how the district's money was spent.

"We casually asked some questions regarding controls over funds coming in the door and were uncomfortable with some answers given," the accountants reported. "It appears there is very little, if any controls over the actual checks and cash that customers remit at the front door."

According to the report, district employees had gas cards they were supposed to use with company vehicles. During the period, employees spent nearly $29,000 in gasoline over the course of two years.

Former interim general manager Art Baer said the report was conducted by the district's insurer at a cost of $18,000.

Eisele estimated the cost of following up would be about $6,000.

"I think it would be money well spent," he said.

Not everyone on the board agreed with him.

"I get the feeling we're beating a dead horse," trustee Brian Patrick said.

After asking Taylor whether controls were in place to prevent future abuses, trustee Laura Lau agreed with Patrick.

"This is history," she said. "We have the controls in place. We've gone through it enough. I would rather move on."

Trustee Denise Pierini said she believes completing the report would clear the air in the district.

"Not once, but several times it says there are areas for potential fraud," she said. "I have complete faith that there's an answer for everything. But we should do the study just to show we're on the up and up."

Eisele said he has taken the report to the district attorney's office and that they would like to see it completed.

Chairwoman Dianne Humble said she hoped Pierini was right.

"But if someone has defrauded the district, then we should pursue them and prosecute whoever is responsible and receive restitution."