Kennett finances improving

An auditing firm hired by Kennett Township has looked at more than 80 percent of the revenue and expenses from 2021 and confirmed the township’s financial health has improved significantly since the 2019 audit.

Chris Herr, one of the partners with Maillie LLP, presented the 2021 audit results at Wednesday’s supervisors’ meeting.

“We’re looking at a lot of stuff, and overall, not finding the issues we did in 2019,” Herr said, adding that 2021 has included more fine-tuning of the controls and processes needed to safeguard the township’s financial health from events like the 2019 discovery of the former township manager’s embezzlement of $3.2 million of township funds.

Chris Herr of Maillie LLP discusses Kennett Township’s 2021 audit with supervisors.

He added that there were no issues of non-compliance.

“We’ve made a lot of progress but still have some improvements underway,” said township Finance Director Amy Heinrich. “The most important thing in the last two years is controls and transparency. We’re making everything public to give the highest level of transparency.”

Maillie issued a qualified opinion on the 2021 audit, which according to Heinrich shows there was a specific issue identified. That issue, according to Herr, is because a column is left empty on the Pennsylvania Department of Community and Economic Development report that the auditors fill out.

“It is only qualified due to the absence of an accounting of general fixed assets,” said Heinrich in her presentation, adding that “while important given DCED standard, this measurement does not have any practical value to the township.”

Audits often identify material weaknesses, which can show an issue in internal controls, according to Heinrich. The 2019 audit identified eight material weaknesses, including the discovery of the embezzlement and the multiple issues with the township’s accounting related to the former township manager. Tracking funds held in escrow was another material weakness.

By the 2020 audit, there were two material weaknesses, including the investigation into the former township manager, as well as tracking the escrow funds.

In the 2021 audit, the only material weakness was with the accounting of the escrow funds, which Heinrich said was the “next step of the prior finding.” The township will focus on what money is in escrow, who owes money for escrow, and other items.

Herr said the team from Maillie started the 2021 audit process with a list of items they wanted to see, including bank balances, reconciliations, and expenses.

“On the expense side we do a lot of sampling of individual transactions,” he said. “For this year we looked at about $5.3 million of expenses … we also looked at payroll registers, every employee’s W2.

“All told, we looked at in excess of 80 percent of expenses for the year. The revenue side was the same.”

Looking ahead, Heinrich talked about what has been accomplished and what remains. She illustrated that with a PowerPoint presentation listing, among other things, the township’s goals, where they are now, and what is left to accomplish. Some of the items the township will be addressing include:

  • Improving the efficiency of the Sage Intacct accounting system and revisiting how efficient some of the processes are;
  • Creating formal documentation for all human resources policies;
  • More training in finance and human resources for the employees in those departments; and
  • Looking at more efficient ways to bill for sewer services.

Township Manager Eden Ratliff said the process to repair the township’s financial situation since 2019 was “a heavy lift.”

“A lot of people have been on this journey with us,” he said. “One PowerPoint presentation doesn’t reflect all the work we’ve done. Amy and her team deserve a lot of credit.”

The audit documents are available on the township website at

About Monica Fragale

Monica Thompson Fragale is a freelance reporter who spent her life dreaming of being in the newspaper business. That dream came true after college when she started working at The Kennett Paper and, years later The Reporter newspaper in Lansdale and other dailies. She turned to non-profit work after her first daughter was born and spent the next 13 years in that field. But while you can take the girl out of journalism, you can’t take journalism out of the girl. Offers to freelance sparked the writing bug again started her fingers happily tapping away on the keyboard. Monica lives with her husband and two children in Kennett Square.



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