SHREVEPORT, Louisiana – A 2025 financial audit released Monday by the Louisiana Legislative Auditor’s Office identified a series of ongoing weaknesses in the city’s financial controls. The report highlights recurring issues with tracking property‑standards debt, accounting adjustments, wire‑transfer approvals and adherence to state public‑bidding statutes.
Property‑standards receivables total roughly $10 million
Auditors found the city lacks adequate procedures to monitor money owed in various property‑standards categories. Since converting to the MGO system in 2019, the city has been unable to produce accurate reports supporting balances carried forward. As of Dec. 31, the outstanding balances total about $10 million. Because documentation is insufficient, the auditors proposed fully reserving the amounts and noted the city is not actively pursuing collection.
The city responded that it plans to engage a collection agency, improve billing procedures and work with MGO and its Information Technology Department to resolve the issue.
Accounting adjustments reveal material misstatements
The audit again uncovered problems with the city’s accounting practices. Auditors proposed material adjustments across multiple funds and accounts, including revenue, receivables, inter‑fund balances, liabilities and expenses. Significant adjustments were also made after the books had been closed, indicating a lack of controls to ensure major account balances are reviewed and accurately reported before closing. The auditors recommend establishing policies that require thorough analysis of significant balances prior to finalizing the books.
Wire‑transfer approvals delegated informally
Wire transfers were found to be approved by an assistant to the director of finance rather than the finance director himself. This informal delegation raises the risk of unauthorized, erroneous or fraudulent transactions. Auditors advise that the finance director approve all wire transfers, and if delegation is necessary, it should be formally documented with clearly identified alternate approvers.
Duplicate vacation payout and unearned compensatory time
The audit disclosed a former employee received an approximately $14,000 overpayment for a final vacation payout in June 2025. The finance department was notified in May that the duplicate payment had occurred and is determining the exact amount owed before notifying the former employee and their attorney. Auditors classified the incident as a misappropriation of assets.
Additionally, a Shreveport Fire Department employee is alleged to have used about $5,000 of compensatory time that had not been earned. The auditors labeled this a misappropriation of funds and recommended a review of policies governing compensatory time, especially during the COVID‑19 response period.
Public‑bidding compliance issues persist
Several violations of Louisiana public‑bidding laws were identified. Contractor affidavits for the Sci‑Port Riverfront Drainage Improvements and the West Shreveport Multimodal Transfer Station were signed after the required 10‑day deadline. A bid for concrete street panels and drainage repairs omitted mandatory pre‑bid meeting details, and a roll‑off‑truck bid remained open for 13 days instead of the required 15. These lapses increase the risk of non‑compliance and reduce procurement transparency. The audit notes these findings repeat those from the 2024 review.
Audit filing deadline missed and federal grant reporting concerns
The city failed to submit its audited financial statements to the Legislative Auditor within the six‑month deadline after fiscal‑year end. Auditors attributed the delay to difficulties obtaining accurate information and delays in gathering data for a federal program test.
Federal pandemic‑relief fund reporting also showed problems. Some 2025 reports did not align with cumulative expenditures from 2021‑2025, and revenue and expenditures were incorrectly reported as program income, inflating program‑income figures. While the city disputes part of the finding, stating that fourth‑quarter invoices were processed after the reporting deadline, auditors warned that the discrepancy could lead to material errors in reports submitted to the U.S. Department of the Treasury.
Vendor‑screening controls need strengthening
In a sample of three contracts, the city could not demonstrate that vendor suspension or debarment status was checked before award. No questioned costs were identified, but auditors warned the lack of verification puts the city at risk of violating federal procurement requirements. The city says its purchasing agent now verifies vendor status using SAM.gov and the Louisiana Secretary of State’s website, retaining search results in procurement files.
Overall, the audit underscores that several prior‑year findings remain unresolved, emphasizing the need for stronger internal controls, clearer documentation and timely compliance with state and federal requirements.
Original reporting: KTBS 3 (Shreveport) — read the source article.
