Auditors face toughest review — their own | February 28, 2020 | Palo Alto Weekly | Palo Alto Online |

Palo Alto Weekly

News - February 28, 2020

Auditors face toughest review — their own

City Council's decision to look to outside consultants for help sparks criticism

by Gennady Sheyner

Roughly two months ago, before the Palo Alto City Council's Feb. 10 vote to explore the outsourcing of the city's auditing operation to a consulting firm, council members met behind closed doors to consider another issue relating to the small office on City Hall's seventh floor: a claim filed against the city by one of the office's three remaining employees.

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Staff Writer Gennady Sheyner can be e-mailed at [email protected]


36 people like this
Posted by NeilsonBuchanan
a resident of Downtown North
on Feb 28, 2020 at 8:54 am

I fully support the Klein/Erickson concept for a internal auditor routinely accountable to City Council. Delegation to an outside auditor is a march to mediocrity.

There are no absolutes. When a City Council encounters an occasional issue warranting outside auditor expertise, then go into closed session and make an appropriate decision.

I don't want to know the personnel details among the previous in-house auditor team. These issues are never easy. The Council and several mayors were their supervisor and should have resolved those differences before the lose/lose crisis erupted.

Mismanagement of Council responsibility is the root cause for a quality lapse. Our current council can re-examine and self-correct.

36 people like this
Posted by Sally
a resident of Downtown North
on Feb 28, 2020 at 9:53 am

Dear Council,

Attempting to deny that the Charter requires that a person hold this office is the kind of pretext that does real damage to democracy and public discourse. It's like gas-lighting. It is embarrassing for you and offensive to us voters.

Please just handle a problem rather than pretend you can con your way out. There is a real problem, yes. You have dragged it out endlessly. The auditor and the auditor's office report only to you. We all see that this is why this charade is going on. You, the council members, do not want to own publicly the problem that you really do own. This dysfunction rolls up to you, past, present, and future.

PS Council Members - The auditor is called an "officer" in the City Charter, just like you. Perhaps we citizens can run a contractor or organization against you in the next election cycle?

35 people like this
Posted by Independent
a resident of Esther Clark Park
on Feb 28, 2020 at 11:26 am

City Council ---
appoint an internal auditor as the City Charter specifies. Now.

21 people like this
Posted by Megan
a resident of Midtown
on Feb 28, 2020 at 2:42 pm

So disappointed in our city council. What a short sighted decision based on the performance of a decimated office. I hope they reconsider. The voters made a good choice in the 1980s that focused on good government - it has saved thousands and thousands of dollars over the years. I will be looking for future council members who know good government when they see it.

14 people like this
Posted by OffToTheRaces
a resident of another community
on Feb 28, 2020 at 4:36 pm

This articles says: "And the office has produced only two audits in the current fiscal year, which began on July 1." Well, of course there have been so few audits. These two audits (if they're the ones I think are being referenced) were issued while there was leadership in the office (the consultant Don Rhoads for a brief period). Staff auditors can't just issue reports on their own. They must be "signed off" by some one designated to be in charge. The point is, with the exception of this consultant, there hasn't been anyone at the helm to accomplish this function. This is a non-argument.

12 people like this
Posted by OffToTheRaces
a resident of another community
on Feb 28, 2020 at 4:53 pm

I think we get a hint of Richardson's instinct for retaliation in the case of Yuki Matsuura. A quick google search reveals she's had over 15 years of auditing experience and even co-authored a book on Auditing with former City Auditor Jim Pelletier. That she would be "demoted" by Richardson from a Senior Auditor to an Auditor I (which is usually someone just out of college with no actual job experience) speaks volumes about Richardson's "management" style.

Further, if there was some sort of payout to Matsuura and her attorney, doesn't that sort of admit to some sort of wrong-doing on the City's part?

17 people like this
Posted by a resident
a resident of Midtown
on Feb 29, 2020 at 8:38 am

If the city hires an outside consultant to be an "officer" under the city council's supervision, who will supervise the remaining employees that work in the auditor's office? An outside consultant wouldn't have the authority to do so, and if they have to report to anyone within the city management hierarchy, it would create a conflict of interest. So what to do with the remaining auditor staff??? If the city gets rid of them under the guise of restructuring, they will surely have a legitimate reason to sue. And with the previous settlement the city has already paid to one of the employees of the auditor's office, there likely will be more settlements to come.

The city council needs to hire an actual person for the auditor's position. Don't set up the residents of Palo Alto to have to pay large settlements for your incompetence, stubbornness, or arrogance. We pay enough taxes as it is without gross negligence on the part of government employees or elected officials.

4 people like this
Posted by Outside Auditor needed
a resident of Downtown North
on Feb 29, 2020 at 7:26 pm

There are complex issues that need to be audited in the city. Hiring an outside auditing firm will enable people who understand these issues to do the auditing.

The city already hires an outside auditor for the financial audit, why not for audits of other departments. A skilled professional auditor in a particular field that does the same audits for other cities can bring a wealth of experience and recommendations to our city.

Just having some "auditors" on our payroll who sit at city hall every day with no outside experience and no new ideas is not the way to go. I fully support an outside auditing agency that is on retainer and the city council setting an agenda to tell them what issues/departments to audit each year.

9 people like this
Posted by Serge
a resident of Mayfield
on Mar 1, 2020 at 12:34 pm

Instead of placing their entire trust and belief in Richardson the Council should have held her accountable for the purported poor performance under her leadership. If the Council listened to staff they could have curtailed or avoided this whole mess by bringing in new leadership once it was clear that things had deteriorated so badly. If things go badly with experienced, respected staff and if productivity is felt to be low, surely it was the responsibility of Richardson, ie the leadership? The Council let this drag on and on. And now they cover their incompetence by ‘outsourcing’. This will end independent auditing since the outside contractor will be structurally dependent on the Council to pay it.

12 people like this
Posted by S. Roberts
a resident of Downtown North
on Mar 1, 2020 at 12:51 pm

The council’s decision to farm out one of the four positions they are supposed to supervise is an excellent example of the peter principle. They may think they are being sophisticated by framing the outsourcing of the auditor position to an outside firm, but in reality shows they are incapable of carrying out the duties in providing direct supervision to a council-appointed position.

City Council, hire an auditor, or better yet, get out of politics. You obviously have reached a position, and demonstrated a level of incompetence, for which you can’t seem to manage appropriately.

13 people like this
Posted by Retired
a resident of Adobe-Meadow
on Mar 1, 2020 at 2:26 pm

Payout of tens of thousands of taxpayer's dollars, along with the inability to fill the vacant auditor position for over a year, equals malfeasance, at best. Fire the entire lot of shameless, dirty city management and get rid of this corrupt council.

14 people like this
Posted by More to the Story?
a resident of another community
on Mar 1, 2020 at 6:17 pm

Wait, what? The same consultant who didn't even know which auditing standards apply to the Auditor's Office was hired by the city in 2016 to investigate allegations against Richardson? Isn't that some kind of conflict of interest? How did the city find him back in 2016? And was it disclosed when he bid on doing this recent consultant report which is being used as a basis for outsourcing the Auditor's Office?

On another note, Sharon Erickson, the retired Palo Alto city auditor, brings an insightful perspective to this issue. Web Link

9 people like this
Posted by Anon
a resident of Another Palo Alto neighborhood
on Mar 2, 2020 at 10:50 am

Posted by Serge, a resident of Mayfield

>> Instead of placing their entire trust and belief in Richardson the Council should have held her accountable

Someone please explain why this is so difficult. Just find a seasoned, experienced auditor near retirement age, and give the person a 1-year contract. Let's see what the office can produce with known, competent leadership. This is the kind of job where people normally should change jobs every 4-5-6 years anyway-- it should never be a "lifetime" appointment.

The same holds true of city managers, BTW. Top leadership positions of this type should always be on the shorter side.

4 people like this
Posted by Anon
a resident of another community
on Apr 29, 2020 at 8:50 am

@OffToTheRaces Your google search may have revealed that she co-authored a book with former City Auditor Pelletier, but it doesn't reveal that she and Pelletier worked together in San Diego before coming to PA. She was hired by Pelletier within 6 months of him starting in PA. She was only hired bc of their prior relationship. If Pelletier wasn't the City Auditor at the time, she never would've uprooted her family from San Diego, and she definitely wouldn't have been hired by any other City Auditor. Matsuura wasn't being retaliated against - she was just bitter she wasn't getting her way anymore.

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