Ambulance accounting practices questioned

JOHNSTOWN — City Internal Control Officer Darryl Purinton related a lack of accounting data available regarding the city’s ambulance service in his July report to the Common Council.

A lack of documentation among city offices in general has also “significantly increased the risk of misappropriation of the city’s assets,” Purinton wrote city officials.

As part of his monthly report to the council, he discussed the status of the Johnstown Fire EMS unit’s accounting.

“The accounting project for the city’s ambulance service for the years ended Dec. 31, 2018, 2019 and 2020 has ceased because the accounting information regarding payroll and other related financial accounting data has been denied to this office and the city treasurer,” Purinton said.

He said the cause was due to a lack of a properly functioning “control environment” as reported in four risk alerts.

“The effects of these risks and all others continue in 2020 and are the primary reasons why reliable financial reporting has ceased,” Purinton said.

Purinton said questions remain as to how much the city has subsidized the ambulance operation, future subsidizing, and how will the city address the affect of noncompliance with laws and regulations if a legal matter is generated.

“Also, the policies and procedures related to the city’s ambulance service are delayed due to the lack of supervision and cooperation,” the report indicates.

Fire Chief Bruce Heberer and Mayor Vern Jackson couldn’t be reached Friday for comment on Purinton’s assessment of the Fire EMS unit accounting.

Elsewhere in his internal control report, Purinton discussed how a city Fraud Risk Management Program “should be place” as part of Johnstown’s governance structure. He said that should include a written “policy or policies” to convey the expectations of the Common Council, mayor and senior management regarding fraud risk.

“I ask you to adopt a fraud risk management program, in part, by approving the attached drafts of the Fraud Policy, Whistleblower Protection Policy and Code of Conduct for Elected Officials and Senior Management that have been issued to the mayor for his review,” Purinton said. “By adopting this program, elements of the control environment, as described in [a risk alert] and its update will be improved. The policies assign to the city Common Council and city management the responsibility to identify fraud risks and how, to whom and the procedures to be taken when a fraud risk is identified.”

Purinton said that because the city has seen “no action taken on any of the draft policies and procedures and risk alerts,” there is an ongoing issue.

“The effects of this pervasive inaction will be articulated in the risk No, 20 series and have caused all financial reporting to cease and significantly increased the risk of misappropriation of the city’s assets,” he stated.

City Treasurer Michael Gifford indicated in July he was also having difficulty completing an important city annual audit report for 2018 because of communication problems with city government officials and departments.

The treasurer said in a memo to a private company reviewing the city’s credit ratings he is “generally met with resistance and even instances of compliance refusals” by departments.

Gifford wrote a July 14 email to S&P Global Ratings, with copies to city officials including Jackson and the Common Council members regarding the city’s unfinished 2018 audit report.

Michael Anich covers Johnstown and Fulton County news. He can be reached at manich@leaderherald.com.


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