☐ Consent Agenda ☐Quasi-Judicial Public Hearing
☒ Regular Business 3:00 pm
☐ Public Hearing Choose an item.
DEPARTMENT: Administration
SUBMITTED BY: Commissioner Jerod Gross
PRESENTED BY: Mandy Hines, County Administrator
TITLE & DESCRIPTION:
title
Womack Sanitation / Audit Determination
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REQUESTED MOTION:
Motion to cease (or continue) moving forward with an Audit of Womack Sanitation’s books and records.
SUMMARY:
Request for formal action of the Board to either withdraw or continue with the audit request and negotiation of a Scope of Work to perform an audit of Womack Sanitations books and records.
BACKGROUND:
On September 10, 2024, the Board of County Commissioners (the “Board”) directed the County’s administration to initiate an audit of the books and records of the County’s solid waste franchisee, Womack Sanitation, Inc. (“Womack”).
On May 27, 2025, the administration provided an update to the Board, advising that the terms of an Agreed Upon Procedure for the requested audit had not yet been reached, and seeking direction as to the scope of the audit. At that time, there was a consensus of the Board to perform a “2024 revenue and expenses audit” for the Desoto County portions of Womack’s operations.
Following the aforementioned meeting, the County Administrator and County Attorney communicated with the County’s auditors, Purvis Gray, who advised that based upon their professional standards and guidelines, a limited review of Womack’s books and records as proposed would not fall within the standard definition of an “audit” and they would not be able to qualify the work product as an audit.
On July 16, 2025, Purvis Gray provided a proposed a “Compilation Agreement” which detailed a limited engagement where they would essentially compile Womack’s financial documents and information and create Womack’s financial statements as they relate to DeSoto County operations for 2024, covering revenues and expenses. However, as noted above, it would not be an audit of their books and records, as there would be no testing or verification of data.
On July 22, 2025, the Board held a budget workshop, wherein Womack made a presentation and requested a rate increase based upon CPI. During that workshop, Womack agreed to a full single year audit.
Following the aforementioned workshop, the County Attorney, County Administrator, and the County Auditor worked diligently to create a scope for the audit engagement, including a provided by client list (“PBC List”), that would provide for a single-year audit of the “DeSoto-Only” segment of Womack’s operations. The proposed engagement letter and PBC list was provided to Womack and its legal counsel on August 20, 2025.
On August 29, 2025, Womack’s legal counsel advised that Womack had engaged an auditor, who reviewed the proposed engagement, and recommended that the audit be on a “tax-basis” of accounting versus GAAP, which would facilitate a more streamlined audit process as it will conform to the method of accounting used by Womack. Based upon the revised auditing methodology, significant revisions were proposed to the audit engagement letter.
The revised audit engagement letter was forwarded to the County auditor on the same date. On September 4, 2025, the County’s auditor responded with their comments to the revised audit engagement letter and explained the differences between the tax-basis of accounting versus GAAP and how that would impact the proposed audit.
On September 12, 2025, the draft audit engagement letter was forwarded to Womack’s legal counsel with the auditor’s revisions and comments.
The estimated fees for the single year tax-basis audit of the DeSoto-only segment of Womack’s operations is estimated to cost between $60,000 and $80,000.
FUNDS:
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