On Tuesday, the City of Hoover released its 2023 annual audit after accounting errors were identified during its 2022 audit. The audit was a result of forensic financial review conducted by BMSS, LCC, an accounting firm based in Birmingham.

BMSS, LLC issued an “unmodified”, or clean opinion of Hoover’s finances, which is the highest opinion an audit can receive. Hoover touted the city’s financial health after the report was made public. 

“For the 40th consecutive year, Hoover earned the Government Finance Officers Association’s Certificate of Achievement for Excellence in Financial Reporting. This award recognizes cities that demonstrate transparency and full disclosure in their annual financial reporting,” Hoover announced. 

The City of Hoover says that in addition to BMSS, LLC’s routine financial audit the City also commissioned a forensic financial review which was conducted by another risk and financial firm, Kroll. Kroll conducted a more in-depth review of the city’s books going beyond the scope of the annual audit.

When accounting errors were discovered in 2022, Mayor Frank Brocato addressed the city council and constituents.

“As city leaders, we are accountable to the taxpayers and citizens of Hoover, and we are committed to being good stewards of their tax dollars,” Mayor Brocato said. “When the audit identified gaps, we selected a globally renowned firm (Kroll) to address the issues and implement steps to safeguard the City’s future. Each item highlighted in the Kroll report has either already been corrected or is being actively addressed.”

According to the city, Hoover CFO Jennifer Cornett was the first to discover the financial issues stemming from the 2022 review and has, “been working with her team to resolve outstanding concerns and improve the department’s operations. 

Managing Director of Kroll’s Forensic Investigations and Intelligence John Slavek attributed the issues in 2022 to a “perfect storm” of negative factors including the death of an employee, implementation of a new software system, retirement of key personnel, and a serious family illness affecting management’s ability to oversee the finance department. 

Slavek said that as a result, the department was short-staffed, leaving some employees unequipped for responsibilities they were given.

Some issues found in the negative 2022 audit were errors in the City’s Quarterly Employer Federal Tax returns, errors in financial records, errors in Public Budget Presentations, and deleted financial files.

Grant Burdette is a contributing writer for Yellowhammer News.