For the fifth year in a row, a state audit of Issaquah’s finances has revealed major flaws.

The 2018 audit results were released this March and showed that the city is still struggling to accurately report its finances. As was the case in prior years, staff turnover in key positions has played a significant role.

Washington State Auditor spokesperson Kathleen Cooper said there were misstatements found during the audit, but there was no indication of fraud or unaccounted money. The mistakes where related to record keeping, as they were last year.

“There’s no money missing. There’s no concern over people not being able to find the money,” Cooper said. “It’s serious, but it’s not egregious.”

The 2018 audit noted there was significant turnover in key finance and accounting positions. Several employees with important roles for managing accounting operations had left the city during the first several months of 2019, as the city was closing out fiscal year 2018.

As a result, Issaquah hired the Government Finance Officers Association as consultants to help prepare its financial statements.

Issaquah spokesperson Autumn Monahan said the city has hired employees to fill key positions, like deputy finance director and budget management analyst.

The report states that although the city has taken steps to improve its financial reporting and review process, the city has been unable to fix all deficiencies. According to the report, employees that review financial statements didn’t have enough time and resources to ensure the underlying accounting records were accurate. Final reviews of statements weren’t adequate to detect and correct errors.

Some of these errors include overstating the revenue balance in three separate accounts by nearly $22 million.

“They are large numbers, and this is why we do this type of audit,” Cooper said.

Cooper said the vast majority of local governments don’t have significant problems, known as findings, in their audits. When cities do have findings, staff turnover is a common reason. It can be hard for smaller governments to attract and retain staff, she said.

Issaquah has been having staffing issues for several years. In a series of reports in 2019, employees expressed concerns over the city’s management and processes, as city leadership said they weren’t concerned about turnover. The city lost its last senior accountant in early 2019, and the citywide turnover rate was 14 percent in 2016 and 2017 — higher than other cities in the area.

Several finance directors had come and gone in recent years. Last spring, then-city manager Emily Moon announced she would take a sabbatical beginning in August. Wally Bobkiewicz was appointed to the role last August.

In the most recent audit, the city acknowledged that staff turnover in the finance department was a top priority. Since early 2019, Issaquah has hired a number of finance professionals. By mid-2020, the city hopes to have the department fully staffed.

The city is also re-implementing a financial reporting system, which was originally rolled out in 2015. The re-implementation, which began in January, is expected to create better access to financial data and make it easier for the city to produce accurate financial statements.

Monahan said the re-implementation will allow the city to fully use it’s program. It’s expected to improve timely access to financial data and reduce the number of manual data entries.

Cooper said it’s hard to know what will happen over the course of a year. However, the changes noted in the report seem significant.

“They are doing the right things in terms of hiring people,” she said.

Monahan further said the city is expecting to submit it’s 2019 financial statements to the Auditor’s office on time, by the end of May. This is months earlier than the city has submitted it’s statements during the previous five years.