by ROBERT MCGREEVY at dailycaller.com
South Carolina’s Comptroller General Richard Eckstrom is stepping down next month after making a $3.5 billion “accounting error” in the state’s end of year financial report.
The error was initially unearthed by one of Eckstrom’s staffers, junior accountant Katie Kipp, reports the Post and Courier (P&C). Testimony to a state Senate panel revealed that Kipp discovered the state’s Annual Comprehensive Financial Report overstated the general fund balance by nearly 50 percent, reports P&C.
Eckstrom revealed to the Senate Financial Constitutional Subcommittee that for a decade, the Annual Comprehensive Financial Report overstated the money sent to colleges and universities, the Associated Press (AP) reported.
Eckstrom blamed the onset of this crisis on a $12 million coding error in 2007 which he says was then compounded by a shift in computing systems beginning in 2011, reports AP. The same report states the sum of the overstated funds reached $1.3 billion by 2017 and has more than tripled since.
State auditor George Kennedy said Eckstrom ignored warnings of a “material weakness” in the comptroller general’s office for a decade, according to AP.
The Subcommittee determined Eckstrom failed to do his primary job, submitting an accurate annual financial report, properly, according to AP.
Though budget makers do not consult the Annual Comprehensive Financial Report, bond makers do and it is the primary tool credit agencies use to determine the state’s credit rating. “Our cash position has been misrepresented, creditors, bond holders don’t like things like that.” Democratic State Senator Thomas McKelveen told AP
The fallout of the mismanagement has prompted state legislators to shift the comptroller’s office from an elected position to an appointed one, with some lawmakers suggesting the position be done away with altogether. The Senate subcommittee unanimously advanced an amendment to the state’s constitution that would allow the governor to nominate a candidate for Senate approval. State Treasurer Curtis Lofton, another elected Republican, suggested his office should absorb the responsibilities of the flailing Comptroller’s office, AP reports.