A.D. Christian Jr.

Retain the services of A.D. Christian of Christian & Yeager, CPAs to assist in the budget pro-ration process.2.

The City Council voted Aug. 28 to shift certain responsibilities -- about 20 percent to 30 percent of the work it takes to do the audit -- from the city's outside auditor, Yeager and Christian, to the city's finance department.
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Morrison and Smith was the city's auditor before Mayor Harvey Fretwell selected Yeager and Christian six years ago.
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The shift in responsibilities comes from the Sarbanes-Oxley law, which was passed by Congress in 2002 in response to major corporate accounting scandals like the one at Enron, said A.D. Christian, part owner of Yeager and Christian.But its effects trickle down to the local level and require that certain accounting practices be done by the city instead of the auditor, Christian said.

"The law changed the rulings as far as what auditors can do," Christian said.
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Christian said the cost of the audit is actually higher than that, but that his firm has charged the same price for several years as a favor to the city.
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In September, the City Council passed a resolution asking Yeager and Christian to submit its audit within 180 days.The annual audit is needed within six months of the fiscal year in order to use it as a financial tool to apply during the current year, he said.

A.D. Christian, Jr.Yeager & Christian, PC

A.D. Christian Jr.Yeager & Christian, P.C.

"The city is in fine financial shape," accountant A.D. Christian said at the special meeting."But, it's heading in the wrong direction.Since 2003, the net operating income has decreased over $1 million."Christian, of the accounting firm Yeager & Christian, P.C., explained that past audits had shown that the trend was that the city would have to pay out more than it was taking in due to debt services.

"Debt services are the things you have to pay every year - like utilities, salaries, etc.," Christian said."You have a $1.9 million operation budget as of September 30,2003, but you also have $1.9 million in debt services for this year."Christian also clarified for the council that there is not a $1.4 million deficit in Northport funds."You were not in a $1.4 million deficit last year, but likely a $403,00 deficit," Christian said.However, Councilman LeGrand Hutchison pointed out that the city has already taken in more than $900,000 within the first nine months of this year.

A.D. Christian agreed."I know [the council] is working to bring in new businesses and funds," Christian said.The meeting was called when council members wondered why it appeared two yearly audits had been performed by two separate firms - bringing about an $11,975 fee."We had to change the original audit report" Christian said, "it was converting the GASB numbers."The General Accounting Standards Board, GASB, requires that additional audits be performed on each grant a city receives when grants total more than $300,000, which they did for Northport this year."We had to go back through the entire audit report and make sure the GASB requirements were met," Christian said.This is a one-time implementation fee, Christian explained.
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Christian also explained that just looking at the numbers can be misleading to the average eye.When money is taken in by the previous council it's counted as income, Christian said, but if it's spent by the next council, it appears as a deficit.Such is the case for the $1.9 million bond that came in with the last council, but was spent to build the police department during this council term.Christian assured the council that they are showing signs of moving Northport in the right direction."This day now," Councilman Billy Booth asked of Christian, "you're saying the city is in good shape?"