County grapples with unwieldy audit firm

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Hospital audit marred by delayed payments


NEW CITY – An upcoming fiscal report on the Summit Park Hospital could be delayed due to disagreements between the firm handling the audit, and an increasingly frustrated County Legislature.

KPMG, the firm auditing the hospital’s finances in preparation for its upcoming privatization, notified the county this week that though they have completed their report, the findings would not be released until they receive payment. This opens the possibility that a report will not be ready in time for the county to prepare its finances.

Though the county owes KPMG for four payments scheduled from February through May, no payments have been made. According to several legislators, the firm has not communicated enough with the county.

“[The legislators] feel that the KPMG auditors have been slow, they haven’t got the reports out in a timely fashion, and they haven’t been responsive,” County Finance Commissioner Stephen DeGroat said. “Therefore, they decided that they weren’t going to make those payments.”

DeGroat argued the move is likely a means to ensure their payment is not based on a positive result and maintained that talks with KPMG would likely resolve the matter. Legislator Alden Wolfe stated such talks were long overdue.

“We’re not requiring any results in the audit,” Wolfe said. “We’re not even disputing that the fee has been earned. All we’re saying is come to our meeting and talk to your client.”

Wolfe went on to say that withholding the report could constitute a breach of professional ethics and lead to a public complaint or a lawsuit.

At the same time, the Legislature agreed KPMG should appear before the legislature to clarify their own position, work out a new pay schedule and smooth out any misunderstandings. According to Legislator Ilan Schoenberger, the firm should be heard out before any further action is taken.

“They may have a legitimate gripe with the county with how they process our payments or do not process our payments,” Schoenberger said.

The county has had issues with KPMG in the past. Last year’s hospital audit arrived in September, well after the typical summer filing deadline in June.

In spite of their poor track record, DeGroat maintained that no other options were available because other auditing firms are reluctant to invest time in Summit Park.

“They’ve been late historically for the last several years. The problem is there’s been nothing but a discussion of the sale or closure of the hospital, which inhibited our ability to get another auditor to come in.”

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