Not everyone happy with recommendation to fire Knox Co. auditor

2:43 PM, Aug 13, 2013   |    comments
Knox County Auditor Richard Walls
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By Mike Donila, WBIR 

(WBIR-Knoxville) A month after the Knox County Audit Committee  recommended firing the county's long-term internal auditor, one member resigned and another local leader publicly berated the panel's chairman.

Mary Kiser, in an often emotional speech during Tuesday's meeting, told the committee that she felt it unfairly suggested to the Knox County Commission the need to terminate Richard Walls.

Shortly after her announcement, Knox County Commissioner Mike Brown, who attended the meeting, accosted its chairman, Joe Carcello.

"I know crap when I see it and you're throwing some here, fella," said Brown, adding that he was "tired" of Carcello's "smug and smiling attitude."

The resignation and the heated discussion came a month after the committee in a 4-1 vote agreed to ask the County Commission to fire internal auditor Richard Walls. Committee members, led by Carcello, said Walls did not do anything illegal or inappropriate, but, rather, it was what he didn't do while performing his duties that made them want to replace him.

Officials called his work "limited" and said he only conducted three audits last year, a low amount for the money spent on the responsibilities. Committee members also said he should better focus on areas where the "county has the greatest risk," including the Trustee's Office, which has a recent history of wrongdoing.

The panel, which makes recommendations to the County Commission, is comprised of Carcello, a University of Tennessee accounting professor; Kiser, a manager for internal audit services at Oak Ridge National Laboratory; and county commissioners Ed Shouse, Dave Wright and Amy Broyles.

Kiser, who's served on the committee since its inception five years ago, cast the dissenting vote to get rid of Walls. The County Commission, which oversees the county's internal audit department, will talk more about the recommendation during its Aug. 19 work session.

During Tuesday's meeting, Kiser said she was stepping down, but not before defending Walls and suggesting that the Audit Committee could have done more to guide his work.

She said the "overall" audits that he's conducted during the past half decade "have been satisfactory and some even more than satisfactory."

"I believe Richard, as a long-time county employee, has been treated unfairly," said Kiser, who represents the East Tennessee Chapter of the Institute of Internal Auditors on the committee. "He has uncovered fraud and identified controls that needed to be strengthened."

She also had problems with Carcello's management of the issue. She said the chairman gave Walls little if any chance to defend himself during the July 9 meeting in which the committee recommended termination. She also questioned why Carcello didn't bother to meet with her, since he met with the panel's other three members to talk about the matter.

Further, she said the county hasn't conducted a performance review of the internal auditor since 2009.

"How can you tell someone you are going to terminate them for unsatisfactory performance when you have not given them an appraisal," she asked Carcello, adding that "part of the blame lies with us."

Carcello, who asked Kiser to reconsider her resignation, said he publicly noticed the meetings he held with other committee members, yet acknowledged that he didn't push to meet with her one-on-one.

"My sense was that you were likely to support Richard and, candidly, I was counting votes," Carcello told her during the meeting. "At that point my decision was made. I value your input . . . but there was nothing that was going to change my mind. This has been five years in the making."

Carcello listed a number of problems he's had with the county's internal auditor, noting "unresolved differences" and a "fundamental difference in facts" cited to him by other auditors and the county's own finance office, and "the overall quality" of his work.

"One of the reasons we have had a court reporter here for the last three or four years is because for the first year or two (after the audit committee was formed) we would have conversations with Richard and then the next meeting it was as if those conversations never happened," said Carcello, adding that he wanted the minutes documented.

Carcello also pointed out that the committee for more than a year has talked about outsourcing the county's internal auditing department, a move that more than likely would have forced Walls out of his job.

Brown, a county commissioner who has long supported Walls, disagreed.

"We've got a failure to communicate and the biggest part of it is sitting right there in that chair," Brown said, pointing at Carcello. "Why did you wait five years to do something about it? You have an axe to grind and I don't like your attitude and I won't stop until you're out of that chair, fella."

Carcello told Brown he was "acting inappropriately," but continued to let him talk.

The two bantered back and forth somewhat for a number of minutes, and Brown continued: "You will hear some more next week (during the commission work session). This is just a preview."

Carcello, responding sharply to Brown, yet addressing the committee, said: "Mike is free to say whatever he wants to say next week and we'll have evidence with us that will refute anything you say. So think long and hard before you do."

Walls declined to comment. During the meeting he told Kiser that he did not know in July that the committee would recommend firing him until it happened.

He also publicly thanked Kiser "for her kind words," adding: "I apologize for what you've had to endure."

Walls, who started working for the county almost 13 years ago, has never been afraid to dig into political minefields and fought publicly with former Knox County Mayor Mike Ragsdale, overseeing a number of audits that revealed all sorts of problems with county spending and forged receipts.

Walls later went to the county's ethics committee and accused Ragsdale of retaliating for the audits by exerting his power as mayor to ruin his career. The Ethics Committee sent the case to the District Attorney's Office, but the DA decided not to press any charges related to official oppression.

The 3-member audit department operates on a roughly $257,000-a-year budget and routinely looks into and analyzes county finances and various county departments. It reports directly to the County Commission, but also answers to the Audit Committee. 

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