Colorado Springs City Council will hold a rare third hearing on what licenses the city auditor should have after councilors failed to pass an ordinance at their Aug. 26 meeting that would have dropped the requirement for auditors to be Certified Public Accountants (CPA).
Councilors will vote when they next meet in September on an amended ordinance that proposes that city auditors hold a Certification of Internal Audits (CIA) instead of a CPA license.
The original ordinance, which was proposed at a work session in July by the head of the city’s human resources department, Myra Romero, called for the CPA requirement to be dropped but did not suggest an alternative. It stirred controversy because City Auditor Natalie Lovell, who was approved for the position by the previous Council after pledging to obtain her CPA within the next two years, had reportedly proposed the change herself.
In response to a question from Councilor Dave Donelson (D1), Romero said that the recommendation to remove the CPA requirement “was brought to me by the city auditor on behalf of council leadership, to look into it.”
Donelson said he had “been told by another councilman that … Lovell has admitted to him that she has previously taken and failed the CPA exam,” but had not, as far as he knew, told City Council or the human resources department.
“To withhold this information and not give City Council all pertinent facts brings her integrity into question,” he said as he called for the vote on the auditor’s credentials to be delayed until an independent body has “[evaluated] what qualifications best serve the City of Colorado Springs.”
He got sustained applause from members of the public for that statement, but the motion, which was seconded by Councilor Roland Rainey (D6), failed, despite a plea from Rainey for Council not to “make a snap decision.”
What was being debated stemmed from “an employee who is recommending a change … to their job description, to the employer,” Rainey said.
“That is not the appropriate way to go about this. Let’s do due diligence here,” he said to more applause from the public.
Councilor Nancy Henjum (D5), who proposed adding the CIA requirement, said it was regrettable that Lovell was being dragged into a maelstrom in which her and City Council’s integrity were being questioned.
Requiring CIA licensure would “help to address the public concern and unfortunate projected mistrust about this Council’s decision” to remove the CPA requirement, she said.
Furthermore, CIA certification “very much matches the requirements of this particular auditor’s office,” Henjum said.
Among topics covered in the CIA exam are professional ethics, risk management, controls, fraud risks, collecting and analyzing information, communication, internal audit operations, and audit plans.
The City Auditor’s office is tasked with providing Council with an independent, objective and comprehensive auditing program for City operations; evaluating the adequacy of financial controls, records and operations and the effectiveness and efficiency of organizational operations; and providing objective analyses, appraisals and recommendations for improving systems and activities, according to the City’s website.
The CPA exam, meanwhile, has three core sections – auditing and attestation, financial accounting and reporting, and taxation and regulation – and three “discipline” sections: business analysis and reporting, information systems and control, and tax compliance and planning.
Eighty percent of the the City Auditor’s job deals with “compliance issues,” At-Large Councilor David Leinweber noted.
“It has nothing to do with CPA stuff.
“We need someone that can work with people, bring a team together, and really be a positive force moving forward … We need an auditor who’s going to build good relationships but still ask the hard questions,” he said.
The question of whether the auditor needs a CPA “could have just been pushed away, but [Lovell] asked the question,” he said.
“And that’s what we want. We don’t want to just do the same thing over and over and over again. Let’s find a way to increase efficiencies within our government,” Leinweber said.
He also roasted some of his fellow councilors for trotting out “gotcha moments” during the hearing.
“I have heard, I’ve seen emails that say that [Lovell] failed the [CPA] test twice,” he said.
“Those are rumors … those are not accurate statements. The statement is: 14 years ago, she took a test and didn’t pass, and she didn’t really think it was relevant with the job that she got, so she moved on and did the job,” Leinweber said.
“I don’t know what I was doing 14 years ago. It’s probably on Instagram somewhere – please don’t go look – but 14 years is a long time ago,” he said.
Lovell confirmed that she sat the CPA exam in the “2011, 2012 timeframe” but insisted she wasn’t trying to cover anything up by not mentioning that she didn’t pass it.
“I wasn’t trying to hide that” by suggesting that the CPA be dropped as a requirement for the city auditor’s job, she said.
“I was simply focused on what was relevant and germane to the conversation of whether or not a CPA is required for this job,” she said.
The amended ordinance, which dropped the CPA but added the CIA requirement, passed with a one-point margin, with Councilors Tom Bailey (D2), Donelson, Rainey and Brandy Williams (D3) voting against it. It will be debated again and put to a vote on Sept. 9, marking the third time that councilors will try to decide what credentials should be required of Colorado Springs’ auditor.
If it passes, Lovell has pledged to obtain CIA certification within two years of March 11, the day she was sworn in.
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