Resort’s Annual Audit Reviewed

OCEAN CITY — Ocean City got a clean bill of health when a report on an audit of the town’s financial statements for fiscal year 2021 were presented last month.

Chris Lehman of SB and Company presented the findings of his firm’s comprehensive audit of the town’s books, its internal controls and designs and a full range of aspects of the town’s finances. The audit is done at the close of the fiscal year each June 30 and a report is presented to the Mayor and Council. Lehman said the audit was thorough and the town came through with flying colors.

“We issued a clean, unmodified opinion of the financial statements,” he said. “We did not find any instances of fraud. The audit is not a forensic audit. We are required to have a healthy skepticism that fraud could be perpetrated by any one at any time.”

The audit examines every aspect of the town’s finances from treasury and financial reporting to payroll and revenue to compliance and grant management. Lehman said the town’s financial departments helped make the process a smooth one.

“We did not discover any material weaknesses in any of the internal controls,” he said. “We received the full cooperation of the management with the questions we asked and the documents we requested.”

Lehman said the influx of federal stimulus money during the last fiscal year for most jurisdictions added another layer in the process.

“We did notice during the year with a lot stimulus money going around, for a lot of jurisdictions and governments, there was an increase in federal funding,” he said. “We did take a close look at that. The town did receive federal funding, so that helped.”

Lehman said an assessment of control environments came up positive in the audit.

“We concluded that the environment was effective for the period under audit,” he said. “You see each of the key processes that were audited. Both looking at the design and operation of these processes, in all cases we concluded that there was an effective design and operation.”

Lehman said the audit team reports directly to the Mayor and Council if any discrepancies are detected, but that was not the case for Ocean City this year.

“If we had difficulties getting through the audit, I would be required to let the council know,” he said. “We did not have to make any adjustments and we found no evidence of any fraud. There is nothing of a negative nature that we found.”

Lehman said the town’s financial leadership was proactive leading up to the annual audit.

“To the management’s credit, whenever they cross a path were they’re unsure, we talk about it while it’s fresh in their minds,” he said. “It’s not like they have to make a bad judgment call. It’s like when in doubt, let’s talk about so when we come back to do the audit, it’s a smooth process.”

About The Author: Shawn Soper

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Shawn Soper has been with The Dispatch since 2000. He began as a staff writer covering various local government beats and general stories. His current positions include managing editor and sports editor. Growing up in Baltimore before moving to Ocean City full time three decades ago, Soper graduated from Loch Raven High School in 1981 and from Towson University in 1985 with degrees in mass communications with a journalism concentration and history.