Presiding commissioner Betty Knight and commissioners Jim Plunkett and Tom Pryor are concerned--and angry--over the loss of $195,000 in county funds from the 2005 tax year.

The loss, not being referred to as of yet as a loss by some county officials but instead as "unaccounted funds," is considered an accounting problem at this point. But all three commissioners are upset that they weren’t informed about the situation until two weeks ago, even though the loss was apparent in Platte County Treasurer Bonnie Brown’s office last September, presiding commissioner Knight said.

In simple terms, the problem is that Platte County's bank account balances show $195,000 less than the county's general ledger in the treasurer's office shows the county having.

The failure of the county treasurer’s office to properly account for the $195,000 is holding up certified financial statements that the county owed to its bonding agents as of June 30. The county is now late in providing the required financial statements.

With this in mind, on Friday the three commissioners issued Treasurer Bonnie Brown, Platte County Auditor Sandra Thomas and the county's hired outside auditor Mike Groszek special instructions that between them they needed to reconcile the imbalance by Thursday of this week.

“Due to the serious nature of this problem we want written conclusions from all three parties by noon on July 27, 2006,” an email from Betty Knight told Brown, Thomas and Groszek.

Outside auditor Groszek, of the accounting firm Troutt, Beeman & Co., P.C., of Harrisonville, did not return a voicemail or a dictated message from The Landmark given to his secretary.

The revelation of the missing $195,000 came to light at a hastily called meeting on July 12, called at the request of private external auditor Groszek and Platte County Treasurer Bonnie Brown.

Platte County has used the services of Troutt, Beeman & Co. for the past several years, at a cost of $50,000 per year on average, said Dana Babcock, Platte County director of administration.

Brown on Tuesday refused an in-person request from The Landmark to answer questions about the missing funds. Brown reiterated “No comment” several times.

Platte County auditor Sandra Thomas was as surprised as the commissioners to learn of the missing $195,000.

“I am very distressed to find out of a cash reconciliation issue through the audit. I was even more upset to find out the treasurer knew there was a problem and hid this fact from me and the county commissioners even though we met nearly every month last year in a finance meeting,” Platte County Auditor Sandra Thomas expressed in an email sent Friday to the commissioners and to Bonnie Brown.

Thomas went on to suggest that her county auditor’s office should complete the reconciliation of the missing $195,000 in order to close out the books for 2005, which remain open and unreconciled.

“I believe that the only way to solve this problem now is to have my office and the outside auditors do a thorough review of the bank statements and complete the reconciliation,” Thomas stated. “This type of problem needs to be prevented from continuing in the future.”

Thomas suggested to the commissioners and to Treasurer Brown that in the future the auditor’s office receive a copy of the treasurer’s monthly bank reconciliation no later than the 15th day of every month.

District 2 Commissioner Jim Plunkett was the most vocal in his displeasure over the missing funds.

Plunkett is upset over the fact that the failure to acknowledge the $195,000 discrepancy has caused the county to unintentionally overstate its financial reserves by the same dollar amount. Plunkett told Brown at the meeting last Wednesday that he would have suggested more budget cuts last fall and winter had he and others besides Brown known about the missing $195,000.

“We have an internal auditing problem,” commissioner Plunkett told The Landmark on Tuesday. “If we can’t reconcile our finances, we’ve got a problem. Did our folks catch the mistake before the outside auditor?”

Plunkett also expressed displeasure that he and District 1 commissioner Tom Pryor didn’t know about the first (hastily called) meeting on July 12, which included only treasurer Brown, deputy auditor Ruby Maline, presiding commissioner Knight, external auditor Mike Groszek and Babcock.

Plunkett, Knight, and Tom Pryor are all concerned about the possibility of taking funds from the financial reserves in order to cover the accounting discrepancy to enable Brown to close the 2005 books and issue the certified financial statements to the county’s bonding agents.

“I don’t think the auditor (referring to Platte County auditor Sandra Thomas) knew about the discrepancy, which troubles me,” Plunkett said.

Plunkett also expressed what he termed a “significant amount of displeasure” with the county’s outside auditor, Mike Groszek, of Troutt, Beeman & Co.

“I’m not happy with the outside auditor, and I’m going to insist on a new outside auditor,” Plunkett said.

It appears also that Groszek and treasurer Brown failed to disclose a $17,000 accounting loss in the 2004 books, a loss that Groszek described as “not material” and therefore not necessary to report, according to meeting journal notes from the July 12 finance meeting.

Knight admonished Groszek at that meeting that any shortage of county funds was material and should be reported to the Platte County Commission.

The journal of meeting notes was made available to The Landmark after an open records request on the topic was made by The Landmark publisher.

All three Platte County commissioners said they are upset about the two years’ accounting losses ($17,000 in 2004 and $195,000 in 2005 so far), about the failure of the treasurer to disclose these losses until two weeks ago (on July 12) and the possibility that the losses could involve mishandling of funds or something worse.

“I think we should have been told earlier. I’m shocked that this (awareness of the $195,000) may have occurred as early as September and we’re just being told about it,” Knight told The Landmark on Tuesday.

“To have unaccounted for money is unacceptable. We need to have answers on whether it’s been misappropriated or stolen. We need to account for the missing money,” commissioner Tom Pryor said.

Brown this week was telling some of her fellow officials that she had reconciled the books through the end of June and she had adjusted the $195,000 figure down to $39,000. But county commissioners said Brown has failed to supply documentation on how she made that reconciliation and county commissioners are still considering the unaccounted amount to be $195,000.

All three commissioners agreed that the first step is accounting for the missing $195,000 and the next steps will be to create controls within the existing system so situations like this don’t become repeat problems for the county.

County attorney Bob Shaw has suggested to the commissioners the possibility of using a “forensic auditor,” who audits the auditors and backtracks, so to speak, with the information available to get to the source of the original loss.

“The big thing is we have a problem and we need better controls in place. There needs to be a second set of eyes (in addition to county treasurer Bonnie Brown) on the reconciliations. How do we know that someone didn’t take the money?” Plunkett said.

“I guarantee you there’s going to be some additional checks and balances added to the process,” Pryor said.

As of The Landmark press time on Wednesday, Brown and Groszek have been working to reconcile the ledger with the bank account but have been unable to locate the missing money.

Neither Brown nor Groszek accepted additional offers to speak with The Landmark.