After Audit Concerns, Wilton Officials Look to Address Town Hall’s Financial Operations

With the Fiscal Year 2026 budget season winding down, several Town officials have said they will turn their attention toward improving financial operations in Town Hall, hoping to correct issues that may be impacting in-house procedures.

The discussion was initiated after the discovery earlier this year of instances when Town officials disbursed large senior tax credits without securing the proper approvals. It was one of the more serious issues that arose during an unusually complicated Board of Selectmen budget process with several long, tense meetings marked by inconsistent financial figures, unclear projections, and a lack of cohesive communication among town officials.

More stress for Wilton’s Finance Department came in the form of problems raised during the annual audit, which revealed a material weakness in financial reporting practice as part of the June 2024 end-of-year accounting process.

The conversation was brought to the table at the Apr. 1 Board of Finance meeting, when member Sandy Arkell expressed concerns about this year’s budget work, in conjunction with the problems raised by the independent auditor.

“The one thing I would say is that this budget cycle was especially stressed, and I think one of the big concerns that I have is that there remains a lot of operational issues and questions that we have,” Arkell said.

“One of those that really is sitting hard with me is the material weakness that we had in our financial close process that was noted in the audit,” she said.

GOOD Morning Wilton spoke with other town officials who echoed the need to address certain concerns about financial and operational processes at Town Hall.

Material Weakness — What is it?

Wilton is required to conduct an annual independent audit per the state’s Municipal Auditing Act, along with a State Single Audit that focuses on state grant requirements. Along with these audits, the Town issues Annual Comprehensive Financial Reports (ACFRs) and Single Audit Reports and makes them publicly accessible on the BOF’s website.

On March 11, the BOF heard a presentation from Leslie Zoll, an auditor with CliftonLarsonAllen LLP, who identified a “material weakness in internal control over financial reporting,” which she attributed to a staffing shortage in the town’s Finance Department.

The 2024 audit revealed shortcomings and errors in the way Town Hall closed out the books from Fiscal Year 2024.

“What this relates to is really the financial close process of the finance office, to include a final review of the balance sheet,” Zoll said. “With the shortage of staff and the UNIS (Unified Network Information System) implementation, there’s strain on the staff.”

“We did find some errors and needed to make adjusting entries,” Zoll said, because staff didn’t have time to adequately review the balance sheet accounts.

“The finance office did go back and look at some of their accounts, and they made entries, and so there was a lot of changes to the trial balance when we first got it back in September,” she said.

“You just don’t want the process to be the auditors reviewing the balance sheet and the finance statements,” Zoll said. “You want to have that financial close process with deadlines and responsibilities lined out so that activity can be done prior to the auditors coming in.”

Wilton’s CFO Dawn Norton, who oversees the Finance Department, did not respond to multiple queries for comment from GOOD Morning Wilton.

The audit report recommended corrective actions and indicated that the Finance Department took steps in response to the evaluation, including the addition of accrual entries and the use of new accounting and financial software.

However, town officials have also focused on inadequate staffing in the Finance Department as a significant contributor to the problem.

The department has been understaffed for close to two years, with at least two of the six positions currently vacant. The position of a manager of financial systems and payroll has been vacant since September 2023.

In her comments at the BOF meeting, Arkell was careful not to place blame on Norton, instead stating that the Finance Department may simply not have adequate funding to bring it up to speed.

“Our CFO needs to be appropriately staffed or we’re going to have even more issues down the road, so that is something that I think we should think long and hard about … I believe the Board of Selectmen likely needs more funding to support its resources and to insure appropriate segregation of its duties and its staffing,” Arkell said.

“I would propose, at the CFO’s, I guess, discretion, I think there should be a deep dive on the amount of resources needed to remediate the material weakness,” she said.

Asked by members of the BOF exactly why that position had remained vacant for so long, including questions of salary, Norton said only that the issue was “internal,” but she would not elaborate much.

“I have my own opinions on it,” she said. “I would say it’s internal … Perhaps the senior accountant position might be slightly under-budgeted compared to others … That could be slightly higher, but I think it’s within ballpark.”

Board of Finance Chair Matt Raimondi told GMW that if the material weaknesses are addressed, “Wilton should be in good standing,” and later added, “My sense is that once those positions are placed, there shouldn’t be any issues going forward.”

Raimondi also believes the auditor’s assessment won’t cause any damage to Wilton’s financial reputation, including to the town’s triple-A bond rating.

“Though it’s not good, I wouldn’t anticipate any negative repercussions,” he said.

Raimondi said it wasn’t his board’s role to specifically address staffing issues, but the BOF will spend more time understanding the way it can exercise its authority.

“The Board of Finance has the ability to oversee the audit, and through that responsibility, we will work to make sure that any identified issues in the audit will be corrected,” Raimondi explained.

He noted that financiers inquired of Norton whether there were sufficient funds to staff her department, and Norton confirmed that there were.

“So, while this is not an issue of budget allocation, the vacancies do remain a concern from an operational and risk management perspective,” Raimondi said. “While the Board of Finance does not have any role in the hiring of Town Hall employees, we fully support Town Hall’s efforts to fill these roles as efficiently and effectively as possible.”

“We will be discussing this topic further during our May BOF meeting,” he said. That meeting will be held on Tuesday, May 13.

Looking at Other Possible Operational Process Issues

Arkell did not respond to follow-up questions sent to her by GOOD Morning Wilton, but at the April 1 BOF meeting, she opined on potentially restructuring staff elsewhere, in particular separating the tax collection and tax assessor roles. [Editor’s note: The tax collector and assessor are not part of the Finance Department.]

“Those are typically separate roles and probably should be,” Arkell said.

“Although the audit report highlighted that management agreed with the opinion, there was no planned corrective action that was in that report, nor has it been communicated to this board,” Arkell said. “I believe there is a significant risk of segregation of duties in Town Hall. It really puts us at risk going forward.”

Selectwoman Kim Healy said her board was well aware of the Town Hall staffing issues.

“There is concern,” she told GMW. “We need those people hired … I’ve mentioned it a bunch of times.”

Likewise, Healy has largely been the most vocal member of the Board of Selectmen to question the range of issues that arose during the budget process, including the tax credit payments issued by Town Hall staff members without proper approval.

Healy, a certified public accountant, publicly asked that an independent review be done.

“I have an expectation that we’re going to address [that],” she said  

“I looked at it from the other perspective, that we put systems in place to ensure that it doesn’t happen again … That’s what I hope comes out of this. That’s what we need,” she said.

Healy praised the BOF’s Arkell for emphasizing the question of staffing as it related to internal process.

“I really appreciate that she brought it up … I really appreciate that there’s someone else on another board that feels the same as me,” Healy said, “and I look forward to working with her on whatever we come up with.”

Healy said she would like to see a joint meeting of the BOF and BOS, which has also been recommended by the finance board.

“I’m going to recommend that we have that as well … I think we all need to bring our thoughts to the table and come up with what can be better,” she said.

As to the BOF’s role in internal Town Hall processes, Raimondi said it plays an important part in following up on issues raised through the audit, especially regarding any risks highlighted that have budgetary, internal control or compliance implications.

“Our focus remains on sound financial stewardship,” he said, “and we will continue to engage constructively when fiscal risks intersect with governance or operational concerns.”

That means keeping an eye on fixing the problems identified this year. “We don’t want this. We want to make sure that this identified material weakness is resolved by next year’s audit,” Raimondi said.

Staffing Update and Internal Review

First Selectman Toni Boucher said the Human Resources Department has been stepping up its efforts to fill slots in finance.

“We have had many more resumes coming in the last month that are currently being screened,” she said. “It is my understanding that towns across Connecticut are finding a dearth of applicants in the municipal finance field.”

Wilton Town Administrator Matt Knickerbocker concurred.

“We are recruiting as aggressively as possible, using all available resources,” he said.

“There is a shortage of talent in this field,” Knickerbocker said, “and this is not just a local problem; it is an issue facing the field of accounting in general, and it is having an especially pronounced effect on public sector employers across the state.”

During the Apr. 1 Board of Selectmen meeting, Boucher briefly alluded to improving internal operations and processes that were called into question following the disclosure of senior tax credit funds issued without going through proper approvals. She said an internal review was being organized.

“We do need a process improvement review to find the gaps that we see in our processes, and that we plan to come back to you with what we find in how we’re going to proceed in making sure we close those gaps,” Boucher said.

Echoing Boucher’s remarks at the meeting, Second Selectman Josh Cole, who had told GMW he planned to call for a formal independent investigation after the unapproved payments were made, appeared to confirm Boucher’s plans about a review that would be done internally.

“We have a review in process that we’re going to finish, and then there’ll be a report prepared that will be brought back to the Board of Selectmen identifying … process gaps and how things are handled. And then I’m sure there’ll be recommendations in there for things that can be be approved,” Cole told his fellow BOS members. “And, obviously, I think, is the board be able to get into reviewing all of that and seeing where the gaps are and where things can be improved and act on it.”