Scathing audit on Richmond City assets

RICHMOND, VA (WWBT) - A bombshell out of Richmond City Hall. A newly released audit finds the city inflated the value of it's fixed assets, such as buildings and land, by more than a hundred million dollars. The discovery triggered a criminal investigation.

The report stems from a 2009 audit. The results were made public Tuesday afternoon after a lengthy investigation concluded.

"The recording keeping was inadequate at best," said City Auditor, Umesh Dalal.

The report revealed that values of assets were inappropriately increased to match earlier over-inflated numbers.

"There was a lump sum of $300 million plus and the city didn't know what the figure consisted of," said Dalal.

A criminal investigation found no criminal wrongdoing. The city says the discrepancy is due to a different methodology used by the current city auditor's predecessor.

"His statement is based upon his methodology -- the values we had were based upon the methodology we had at the time. It's complicated by the fact that some of the records were purged -- it's also complicated by the fact that some of the records weren't as well kept as they could have been," said Richmond Chief Administrative Officer, Byron Marshall.

Moving forward, adjustments are being made using the current city auditor's methodology.

"We believe the method we used was approved - however we don't want this to come up again as new auditors come into place so we agreed with the auditor --  so everybody is happy," said Marshall.

The city has made a preliminary adjustment, to the tune of $21 million, to it's 2011 financial statement.

The city's CAO says the discrepancy will be completely fixed within a year.

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