Who Needs an Independent Auditor?

Imagine that you have invested your life’s savings in a bank. You want your savings protected from harm.  Who can you trust?  Hopefully, everyone at the bank will be working to protect your savings. Your money will be under the care of a bank president and its board of trustees.  However, who watches them?  Independent auditors watch them. For the same reason we would not trust a “fox to guard the hen house,” a bank auditor should not be controlled by the bank president and his board of trustees.

Can An Auditor Objectively Evaluate His Own Boss? 

Bank auditors evaluate how your savings are managed. A City Auditor evaluates how your tax dollars are managed.   Citizens have a greater level of protection when the Mayor who makes money decisions and a City Council who approves the same decisions do not exert total control over the auditor.  No auditor that functions at the pleasure or direction of politicians or their appointees can be truly objective in evaluating the money decisions their bosses made. If fraud, waste or abuse does occur, the incentive for auditors to report the involvement of their bosses (bank presidents, mayors, boards or councils) decreases. 

Mayors, City Council members and all other elected officials naturally want to avoid scandal.  If they are in charge of government when contracts are signed, money is wasted or fraud occurs, they should have minimal if any control over city audit investigations and evidence reporting.  If an auditor relays evidence of significant financial risks or illegal management of tax funds, and a Mayor or the City Council “looks the other way,” the people suffer. The auditor is the last line of defense for protecting the assets taxpayers support and on that which citizens rely.  Auditors are known for telling the good, bad and the ugly of where the money went. The public has a right to know it all. 

What do Naysayers fear?

Some have complained that an Independent Auditor will be an added expensive to taxpayers.  The city’s chief financial officer stated there is no negative budget impact. The auditor’s budget was approved months ago and is unchanged.  Before it can be changed next year, it must be scrutinized and approved by the City Council and Audit Committee. 

Some have complained that if politicians can’t remove the auditor, he or she might “go wild” with investigations.  Cases of “rogue auditors” are very rare. However, to guard against such possibility, the Chattanooga City Auditor must report all work to an Independent Audit Committee of Certified Public Accountants, the Mayor, City Council and the public. The ability to dismiss an auditor has not disappeared as some have suggested. The criteria have simply been made high enough to avoid undue political influence in the process.         

The City’s Audit Committee and the City Council approved granting the City’s Audit Department independence from political influence. (Note: The Audit Committee consists of five Certified Public Accountants who are Chattanooga residents. They are not employed by the city and there is no expense for their services. Like other city board members,they are not paid.)

What Do Auditors Fear?

In the late 1500’s, the idea of “killing the messenger” was an option for destroying the bearer of bad news. Later, “shoot the messenger” became a popular phrase.  It is important to realize the auditor is the financial messenger. City auditors need the freedom to follow the tax fund money trails and provide full public and government access to the investigation findings. 

Today, elected officials have developed more civil ways to divert and muzzle auditors who discover and share bad news. Though rogue auditors are rare, there are many ways to bend or break an auditor.  They range from subtle to bizarre.

·        Fire the auditor or find someone else to fire the auditor

·        Prohibit the auditor access to relevant documents 

·        Prohibit people from talking to auditors

·        Slowly reduce the auditor’s salary or never allow a raise

·        Decrease or eliminate the audit staff

·        Decrease or eliminate the office supply budget

·        Move the Auditor’s office away from the main location where current financial documents are housed. For example: City Hall

·        Put the Auditor’s job on a political election cycle

·        Reduce the auditor’s office space to a closet

·        Sully an auditor’s reputation and then dismiss the auditor. This helps ensure the auditor cannot find work locally or anywhere else.

What Do Chattanoogans Want?  

Aug. 2, 2012, seventy-three percent of Chattanooga’s voting residents chose to reduce the effects of political influence by having the City Auditor report to an Audit Committee of CPAs (instead of the Mayor).  Less than eight days after that election, a select few politicians began work to negate the basis for independence and the will of voters by drafting an amendment to amend the amendment voters just approved.  Voters are not ignorant, nor were they confused at the ballot box. There is no need for a revote, rewording, or reinterpretation of what the voters want and overwhelmingly approved on Aug. 2nd because Chattanoogans Want Financial Audits Reports Free From Political Influence.

Deborah Scott

District 1 Representative

Chattanooga City Council

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To Deborah Scott concerning your audit opinion:

  You are the only logical voice in all of Hamilton County government. I am sure it is frustrating, but once again, you keep proving yourself to have integrity and are willing to do what is truly needed.

I do not live in Hamilton County or Chattanooga, but you have my vote. Keep up the good work.

Joe Blevins

Guild, Tn.