Pierce County Library System Misclassified Nearly 16 Million Due to Inadequate Financial Controls

A state audit released on December 18 uncovered serious financial reporting deficiencies within the Pierce County Library System, revealing a misclassification of nearly $16 million for the years 2022 and 2023. The audit highlighted that the Pierce County Rural Library District misclassified about $4. 4 million in fund transfers in 2023 and significantly understated pension liability assets. Additionally, the library submitted incomplete financial statements that did not comply with the Governmental Accounting Standards Board's requirements. Kathleen Cooper from the Washington State Auditor’s Office emphasized that while the audit revealed critical issues, it confirmed that no money was missing, only miscategorized.

The library system has acknowledged these findings, attributing the problems to an understaffed finance department and inadequate training. They are committed to improving processes based on the auditor's recommendations and appreciate the thoroughness of the audit. Cooper noted that addressing these deficiencies is vital for maintaining public trust, especially when government entities seek loans or financial assistance. The state auditor plans to conduct a follow-up review in the next audit cycle to assess compliance and improvements.