Audit of Economic Development Incentive Fund Program, April 2019

15 |  A u d i t o f E c o n o m i c D e v e l o p m e n t I n c e n t i v e F u n d P r o g r a m  A p r i l 2 0 1 9 6. Write‐off Process Observation  The Accounting Policies and Procedures, section 9.10 states that “it is the responsibility of any  business center that generates accounts receivable to enforce collections of the receivables and  to submit uncollectible accounts to the Board of County Commissioners to be written‐off.”  When an entity has entered into a Financial Incentive Grant Agreement with the County and  has been awarded grant funds for job creation or relocating their business, the entity is still  required to continue performing for benefits previously received. If an entity fails to meet those  requirements, then the “clawback” provisions can kick in which would then require the entity  to return the entire benefit or a portion of that benefit to the County.  Since the inception of the Economic Development Incentive Program, there have been a total  of 16 entities that have been required to return funds to the County. Of those, four entities  continue to owe the County money, which totaled $508,625 as of September 28, 2018.  During testing, the auditor determined that:   Two of the entities owe the County $50,000 each,   One entity has been sued by the County and is required to pay back $350,000, and   One entity has a balance of $58,625 and has made 17 payments to date.  The auditor determined that the County has not complied with section 9.10 of the Accounting  Policies and Procedures. Additionally, the department has failed to notify the Finance  department that these repayments are to be recorded as receivables for the County.  Recommendation To ensure compliance with the Accounting Policies and Procedures, the County should bring all  possible write‐offs of receivables to the BCC for review and approval. Additionally, the County  should implement a procedure to notify the Finance department any time an entity is required  to return money to the County.  Management Response  Beginning with Fiscal Year 2019, Governmental Relations Staff will bring all possible write‐offs  of receivables to the BCC for review and approval in accordance with the Clerk of Circuit Court  Accounting Policy 9.10.