REDMOND — An independent audit completed this month took issue with CourseCo’s financial management of Juniper Golf Course, which began to face budgeting dysfunction after a former general manager resigned in early 2015, according to the report.

The state-required audit, which took a look at the city of Redmond’s financial activity last fiscal year, deemed the golf course management company’s handling of the golf course budgeting a significant deficiency — the only such designation in the report.

Among the criticisms was the reduction of controls over deposits, collections and billings and monitoring of past-due accounts; an increase in food and beverage costs; the consistent overstating of revenues and payroll costs in the budgeting process; as well as issues in the monitoring and proper recording of accounts payable and accounts receivable.

“We could tell there were some things that looked a little strange out there, so we took a closer look,” said Rob Tremper, who presented the audit report to the Redmond City Council at Tuesday night’s meeting on behalf of Dickey and Tremper LLP, which conducted the audit. “A change of managers saw duties delegated to senior staff, and we saw a dropping back on the monitoring of the billing and collections because they had been shifted around.”

The problems, which the audit stated were due to a change in CourseCo’s sales software along with former General Manager Steve Bratcher’s resignation, didn’t involve unauthorized expenses, said Jodi Burch, one of the city’s deputy directors of central services.

“It was the timing in which expenses posted,” Burch said. “The expenses were authorized — say an item was ordered in June but wasn’t paid for until July, and then it was inadvertently recorded in July. The costs were eligible and appropriate; it was a timing thing. Any time you go through a software conversion, that’s a very extensive process. Staff was going through a lot of cleanup.”

Still, the audit stated issues like these increase the risk of future errors or improper behavior, and it was recommended the city work with CourseCo to make sure these problems don’t keep occurring.

The city, responding to the audit’s findings, stated in the report that it’s confident a new set of goals and performance metrics, along with monthly meetings between representatives of the city and CourseCo, will likely bring improvement. All of this is outlined in the city’s new four-year contract with CourseCo, which went into effect on Jan. 1 and includes incentives and safeguards that the previous contract with the company lacked, Deputy Director of Central Services Jason Naff said.

“The (previous contract) was the first time the city had a contract with a professional management company,” Naff said. “We created it using other contracts, but now we have a better understanding. Now we were able to put some things in there we know that we want achieved.”

The hiring of new General Manager Tim Kane, who starts Feb. 1, as well as the creation of a Contract Oversight Team featuring city staff, a golf committee member and the City Council golf liaison, will help to improve bookkeeping operations, Naff said.

Beyond the golf course, Tremper said the rest of the audit showed a healthy financial operation.

“We’re happy to say we have a clean audit opinion this year,” he said, adding that the report was delayed due to some catchup the city had to do in regard to correctly reporting grant money from the previous fiscal year to the state.

“We did have some extra time needed because of last year’s audit,” he said. “To clear those findings it took (until) about mid-December of 2015 to get everything worked out with the state. The issues got cleared up.”

Also at the meeting, City Council members approved an ordinance that will lead to the refinancing of a $5 million federal loan for its wastewater treatment plant, as requested by the U.S. Department of Agriculture. The city plans to issue bonds that Naff said will lower debt service costs and ultimately save the city about $900,000 over the life of the loan, which is currently set to be paid off by 2040.

— Reporter: 541-617-7829, awest@bendbulletin.com