‘Lack of policies’ blamed for rail accounting error

A recent independent audit done for Hono­lulu’s rail transit project found its finances to be in order with one exception: Rail finance officials failed to properly record $83.8 million in federal funds received for the project.

PKF Pacific Hawaii LLP completed the analysis of the project’s finances through June 30. Officials with the Hono­lulu-based firm presented their report to the Hono­lulu Authority for Rapid Transportation board during its general meeting Thursday.

Those federal dollars aren’t missing, HART Chief Financial Officer Diane Ara­kaki explained after the meeting. There was simply a "recording error," which caused no adverse impact to the project, she said.

The funds were used to reimburse the city money already spent on the $5.26 billion rail project, Ara­kaki added.

PKF said the accounting error was caused by a "lack of policies and procedures" by HART "to ensure that reimbursable expenses are billed in a timely manner."

In a written response on the issue, HART said it’s recruiting for a full-time federal grants manager, who will make sure those dollars are recorded in a timely manner.

This is HART’s second annual audit. PKF Pacific has a multiyear contract with HART and is slated to complete the audit again next year, according to HART spokes­woman Jeanne Mari­ani-Bel­ding.