3 days ago
Smyrna lacking sufficient financial reporting, governance: State auditor report
A state audit has uncovered serious deficiencies in the Town of Smyrna's financial oversight and internal controls, raising concerns about how public funds are managed and monitored.
Conducted by State Auditor Lydia E. York, the 2025 performance audit examined town operations between 2022 and 2023. The report identified deficiencies in Smyrna's governance, including the absence of formal bank reconciliation procedures, poor tracking of capital projects and inadequate monitoring of federal relief funds.
The problems are compounded by turnover in key management and accounting roles, the report stated.
One major concern identified in the report was the town's inability to provide records detailing the status or funding sources of its capital projects, flagging Smyrna's management of more than $6 million in American Rescue Plan Act funds as particularly concerning.
The report noted auditors found insufficient documentation for tracking spending, project progress and a lack of processes to monitor the use of ARPA money.
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The audit's other key findings include:
Financial systems: The town continues to operate two separate accounting software systems, despite planning a transition to a unified platform in 2022.
Procurement: The town failed to follow its procurement policy consistently due to insufficient oversight and monitoring.
Policy gaps: A lack of comprehensive policy and procedures manual to guide governance and operations, contributing to poor communication between the Town Council and Town manager.
Budgeting practices: No established process exists for management to review or approve budget-to-actual financial comparisons.
The report findings concluded that these lapses increase the risk of errors and potential fraud. It also emphasized the need for Smyrna to implement corrective actions to improve internal controls, transparency and overall financial governance.
Smyrna operates under a council–manager form of government. The auditor's report also included a formal response from Town Manager Torrie M. James. In the report, James stated that many of the audit's concerns are either being addressed or have already been resolved.
In addition, the town posted a statement to its website providing further context, emphasizing that the audit was initiated at the request of the Town Council.
The statement attributes gaps in internal controls to high turnover in key roles, including the Town Manager and Finance Director, over the past several years. That instability, the statement says, contributed to the weaknesses in financial procedures cited in the audit.
'The audit findings confirm what the current leadership team observed upon stepping into their roles: the Town lacked established written policies, consistent oversight procedures and internal checks and balances across several departments,' the statement reads. It says the lack of documented procedures and oversight created operational risks but emphasizes that no misuse of funds was found.
The town asserts that a new leadership team, installed in March 2024, is committed to accountability and transparency in its effort to rebuild its operational foundation and restore public trust in its management.
The auditor's report acknowledged Smyrna's growth, with the population rising to over 13,200 residents, a 3.4% increase. It concluded that this growth, combined with weak internal controls and inconsistent financial procedures, created challenges for transparency and effective management.
Auditors recommended the town institute stronger systems of oversight, especially as demand for services continues to rise.
The full report can be downloaded from the state auditor's website.
You can contact staff reporter Anitra Johnson at ajohnson@
This article originally appeared on Delaware News Journal: Smyrna audit report details gaps in procedures, ARPA fund tracking
