Audit finds City of New Orleans pays vendor invoices months late
NEW ORLEANS (WGNO) — After multiple vendors complained to the city council, an audit found that the City of New Orleans pays its vendors months late, and sometimes takes more than a year to do so.
According to the New Orleans City Council, it requested that the Louisiana Legislative Auditor conduct an audit after receiving the complaints.
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“Some of the findings are truly shocking. It’s a multi-tiered failure. Ultimately, it’s the people of the city who suffer most because work and projects are then delayed, and we’re already learning of vendors who do not want to work with the city anymore because of delayed payments, which means those who are still willing, will cost taxpayers more,” said Council President Helena Moreno.
The audit found that the city can’t accurately determine how long it takes to pay invoices, invoices can be deleted without tracking, contracting and purchase order delays prevent vendors from being able to submit their invoices and that there’s a lack of communication to vendors and city departments about the invoicing system called BRASS.
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The audit report stated, “Not paying vendors timely can result in fewer vendors that choose to conduct business with the city and bid on city projects, potentially affecting the quality, timeliness, and price of goods and services.”
“The silver lining is that, ever since I brought in the legislative auditor, the administration began to make improvements and have committed to work through the recommendations in this report. This also sets the road map for the next administration to come in and fix this issue for good. I appreciate the hard work of Auditor Mike Waguespack and his team on this useful report and assistance in finding solutions,” said Moreno.
The City of New Orleans issued the following statement regarding the audit:
As the Administration stated in the Audit on Timeliness of Vendor Payments, “I want to thank the Louisiana Legislative Auditor’s Office for performing such a thorough and robust audit on our new ERP System, INFOR, also known as BRASS (Budget, Requisition, and Accounting Services System). This performance audit addressed the process sensitivities and roadblocks we have continually reviewed and enhanced.” We accepted all of the recommendations from the Louisiana Legislative Auditor’s Office. The Administration implemented a few recommendations within the audit period – discontinuing deletion of invoices and canceling invoices instead for audit trail purposes in BRASS; developing Standard Operating Procedure Manuals for BRASS, inclusive of Purchasing & Accounts Payable; and increased communication with departments via BRASS on the disposition of their vendor invoices, to facilitate timely payment. The other recommendations are being cost-analyzed with our system vendors to ensure they are feasible.
City of New Orleans Department of Finance
Read the full report:
Audit finds City of New Orleans pays vendor invoices months lateDownload
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