Deegan Wants Jacksonville's Finance Department to Teach Financial Oversight. What About Its Own Audit Problems?

John Hawley

Oct 25, 2026

The Mayor's Office: Part XII

Mayor Donna Deegan wants Jacksonville's independent-agency board members trained to recognize financial warning signs. But her administration is assigning that responsibility to a Finance Department whose own financial reporting has been criticized by independent auditors. With millions in accounting corrections, weaknesses in payment controls and unresolved questions surrounding JTA's $39 million financial crisis, should Jacksonville's independent auditors have a larger role in teaching accountability?

Deegan's New Executive Order Puts Financial Oversight Under the City's CFO

On October 6, 2026, Jacksonville Mayor Donna Deegan signed Executive Order 2026-03, encouraging members of City boards, commissions and independent agencies to receive training in financial oversight, governance, auditing and ethics. The order also proposes requiring agency chief executives to certify the accuracy and completeness of financial information submitted to City Hall. Deegan announced plans to work with City Council to make the standards enforceable through legislation.

The initiative followed the Jacksonville Transportation Authority's disclosure of a financial crisis involving approximately $39 million in projected budget pressure, major workforce reductions and transit service cuts. City Council investigators have since raised questions about how JTA's budgets were prepared and whether financial information provided to its board accurately reflected the agency's operating obligations. Those concerns extend beyond whether individual board members understood the numbers they received.

The mayor's proposal addresses a legitimate problem. Volunteer board members overseeing major public organizations need sufficient financial knowledge to challenge executive leadership and recognize warning signs. But Jacksonville's own audit records reveal that weaknesses in financial reporting are not confined to independent agencies.

The larger question is whether the City's existing financial oversight system is prepared to deliver the accountability the mayor is now proposing.

What Does Executive Order 2026-03 Actually Require?

The executive order encourages training in fiduciary duties, financial statements, audits, internal controls, fraud awareness, ethics and Florida's public-records and Sunshine laws. New appointees are encouraged to complete training within 90 days of confirmation, while existing appointees are encouraged to participate within 180 days. Refresher training is recommended every two years.

Participation remains voluntary under the current order. Completion is not a condition of appointment or reappointment, and independent agencies retain their statutory and charter responsibilities. Deegan acknowledges that binding requirements will require additional action by City Council and, potentially, changes to governing agreements or laws.

The order also recommends that independent-agency financial submissions carry certifications from executive leadership. Those certifications would affirm that the information fairly presents the agency's financial condition and discloses known significant weaknesses in internal controls. The City CFO's office would identify submissions lacking certification and report unresolved deficiencies.

These are potentially useful safeguards. But certification does not independently verify a budget, and financial-literacy training does not replace auditing. Their effectiveness depends on the reliability of the underlying records and whether someone with sufficient independence and expertise examines discrepancies.

Anna Brosche: The City's CFO Will Lead Financial Training

The financial-literacy component of Deegan's order is assigned to the Office of the Chief Financial Officer, led by Anna Brosche, CPA, MAcc. Brosche became Jacksonville's CFO and director of finance in October 2023 after a career in accounting and public service, including membership on Jacksonville City Council and a term as Council president. Her office oversees the City's accounting, budgeting, treasury, risk management and grants-related financial functions.

Under the executive order, Brosche's department must make financial training available within 90 days and offer it at least annually. The curriculum will address governmental financial statements, budget procedures, debt obligations, credit ratings, pension liabilities and warning signs requiring further board inquiry. Agency board chairs may request financial briefings tailored to their organizations.

Brosche's accounting credentials make her qualified to participate in developing the curriculum. But her office is also responsible for financial operations that have been examined in several critical audit reports. Those findings deserve consideration when evaluating how the training program will be designed and who will independently assess its effectiveness.

This is not an allegation that Brosche caused the problems identified by auditors. Some findings originated before she joined the administration, while others concern systems and procedures that continued into her tenure. The issue is whether the Finance Department's own audit history should inform the lessons it teaches other public agencies.

Jacksonville's Own External Auditor Found a Material Weakness in Financial Reporting

One of the most consequential findings appears in Jacksonville's fiscal 2025 Single Audit, prepared by the City's Finance Department and audited by Carr, Riggs & Ingram, LLC. The independent auditors issued an unmodified opinion on the City's financial statements but separately identified a material weakness in internal control over financial reporting. Finding 2025-001 describes accounting adjustments that became necessary during the annual audit.

A material weakness is a formal auditing classification indicating a reasonable possibility that a material financial misstatement would not be prevented, or detected and corrected, in a timely manner. It does not establish fraud or intentional manipulation. Nor does it mean the final audited financial statements were materially misstated after the required corrections.

Nevertheless, the finding is significant. Auditors identified problems involving revenue recognition, uncollectible accounts, debt-service classifications and capital assets. Those are precisely the kinds of financial-reporting subjects that Deegan's new training program is intended to help public board members understand.

The City accepted the finding and proposed stronger reconciliations, management reviews and year-end accounting procedures. Its corrective-action plan identifies December 2026 as the anticipated completion date. The finding therefore remains especially relevant as the mayor's administration begins implementing its new financial-oversight initiative.

Millions in Accounting Corrections: What the FY2025 Audit Found

The independent auditors identified a $4.64 million adjustment involving the Solid Waste Disposal Fund. When service charges increased in January 2025, the City increased its recorded receivables and revenue without making a corresponding adjustment to its allowance for amounts unlikely to be collected. The audit required the allowance to increase and reported revenue to decrease by approximately $4.64 million.

Auditors also found that untimely deposits and missing reconciliations caused approximately $1.03 million in fiscal 2024 intergovernmental revenue to be recorded in fiscal 2025. Correcting entries reduced current-year revenue and increased the beginning fund balance. The issue concerned which fiscal year should recognize the revenue, rather than evidence that the money had disappeared.

The audit identified larger classification problems involving capital assets. Governmental construction-in-progress balances were reduced by approximately $62.8 million, land balances by approximately $28.3 million, and infrastructure balances increased by approximately $28.5 million through correcting entries. Another $32.2 million was reclassified from construction in progress to infrastructure within the Storm Water Fund.

These adjustments were not findings that the City lost those amounts of money. They were accounting corrections necessary to present assets, liabilities and revenues properly. Their scale nevertheless demonstrates why independent verification matters, particularly when financial statements are used to guide public spending and investment decisions.

The City's Audit Even Identified JTA-Related Accounting Corrections

The FY2025 audit includes findings directly involving the City's accounting for JTA-related financial activity. Auditors determined that approximately $7.10 million in debt principal and interest payables needed to be transferred between City debt-service funds. They also identified approximately $3.15 million in revenues associated with JTA contributions toward debt service that needed to be recorded in a different fund.

These were fund-classification corrections, not findings that JTA failed to contribute those amounts or that the corrections caused its subsequent $39 million financial crisis. The external audit does not establish a connection between the City's accounting entries and the disputed internal budget projections now under investigation at JTA. The distinction between the two issues is essential.

But the findings do demonstrate that the financial relationship between City Hall and JTA involves transactions requiring accurate accounting on both sides. The mayor's executive order specifically recognizes that independent agencies can create financial obligations affecting the City's budget. The City's own auditors have now documented examples of why those relationships require careful review.

That makes the new certification proposal particularly relevant. If independent-agency executives are expected to certify information provided to City Hall, what comparable procedures ensure that the City's own records of agency-related revenues, obligations and transfers are accurate? And who independently verifies that the information is reconciled across the organizations?

The Council Auditor Found Weaknesses in the City's Accounts Payable System

Another important report is Council Auditor Audit #892, issued June 10, 2025, examining the City's accounts payable operation. Auditors concluded that vendor payments were generally accurate, properly supported and approved, but identified significant internal-control weaknesses and delays. The review covered payments processed between August 2023 and January 2024, with additional testing of financial-system access.

Among the findings were excessive user permissions, inadequate separation of duties and 241 former-employee or never-hired accounts that had not been deactivated at the financial-system level as of September 2024. The audit also found that employees involved in creating payments had made numerous changes to supplier banking information. Auditors recommended stronger restrictions and documentation to reduce the risk of unauthorized changes.

The report identified more than $3.8 million in duplicate payments that were subsequently detected and corrected. It also documented delayed bank reconciliations, payment-processing problems and incomplete or outdated operating procedures. These are examples of control weaknesses that may allow mistakes to persist longer than they should.

The administration's response described corrective actions, including changes to system permissions and supplier-account monitoring. Those responses are relevant, but they do not eliminate the original findings. A useful measure of accountability is whether subsequent independent testing confirms that the corrective actions work.

A 2026 Grants Audit Found Hundreds of Thousands in Questionable Payments

Council Auditor Report #901, issued March 2, 2026, examined the Finance Department's Grants and Contract Compliance Division. Auditors tested $1,367,925 in payments and identified $477,825 involving insufficient documentation, unsupported costs or expenses that were not allowable under the relevant grant agreements at the time of payment. The report also identified weaknesses in grant monitoring and the authorization or documentation of budget changes.

The timing requires clarification. The audit examined grants from fiscal years 2021–22 and 2022–23, primarily before the Deegan administration. The report itself acknowledged changes in division leadership and noted that its testing period related to the previous administration.

Nevertheless, the findings illustrate the type of institutional problems that financial training should address. The auditors identified payments that were made despite insufficient documentation and instances in which budget reallocations lacked proper authorization. The Finance Department described corrective measures, including additional reviews, updated procedures and changes to payment forms.

The broader lesson is that training must address the controls used to prevent inaccurate payments and unauthorized changes, not simply the ability to read a financial statement after transactions have been recorded. Effective oversight requires reliable processes at the point where expenditures are reviewed and approved.

Additional 2026 Audits Found Problems With Purchasing Cards and Reimbursements

The Council Auditor's April 28, 2026, purchasing-card audit identified further weaknesses involving City financial procedures. The review found that 202 transactions totaling more than $94,000 from calendar 2024 had not been fully recorded in the financial system by April 21, 2025. Following additional testing, 45 transactions totaling $10,946 remained unprocessed or inadequately supported as of June 26, 2025.

Auditors also found delays in submitting and approving purchasing-card transactions, gaps in reconciliation procedures and instances of insufficient authorization. The report nevertheless concluded that transactions were generally appropriate, documented, approved and accurately recorded. Its concerns focused on the consistency and effectiveness of financial controls.

A separate employee-reimbursements audit, issued May 15, 2026, found delayed processing, incomplete procedures, problems closing travel cash advances and limited reimbursement errors. Again, auditors concluded that the transactions reviewed were generally appropriate. The recurring concern was whether established controls were operating consistently and whether weaknesses were corrected promptly.

Taken together, these audits show why Jacksonville's new training program should be grounded in the City's actual experience. The problems are not hypothetical examples from an accounting textbook. They are documented findings involving the financial systems public officials are already responsible for overseeing.

Why Aren't Jacksonville's Independent Auditors Leading the Financial Oversight Training?

Jacksonville already has a Council Auditor's Office, led by Phillip Peterson, with authority to examine City financial systems and conduct audits involving City departments and independent agencies. The City also retains an external auditing firm, Carr, Riggs & Ingram, to audit its annual financial statements. Both perform oversight functions separate from the executive-branch Finance Department.

Deegan's executive order does recognize the Council Auditor's Office. Section 1.4 calls for the Mayor's Boards and Commissions staff to coordinate development of the broader governance curriculum with several offices, including the Council Auditor, as each may agree. That is an invitation to participate, not a requirement that the auditors design, approve or deliver the training.

Section 2 separately directs Brosche's Finance Department to develop and provide financial-literacy training. The order does not require the Council Auditor or external auditors to lead the financial-statement component or independently evaluate its effectiveness. Whether those professionals will have a substantive role remains an implementation question.

That distinction matters because the City's own auditors have documented weaknesses involving financial reporting, internal controls, grant monitoring, vendor payments and account reconciliations. They are familiar not only with the rules governing public finance but also with the specific procedures that have failed to operate as intended in Jacksonville.

CFOs and financial managers bring essential operational expertise. Independent auditors bring a different perspective: testing management's representations, identifying unsupported assumptions and evaluating whether internal controls actually work. A training program intended to strengthen public accountability should benefit from both.

The question is not whether Brosche should be excluded. It is whether the officials who independently identified weaknesses in the City's financial operations should have a defined and meaningful role in teaching board members how to recognize similar problems.

JTA's CFO Turnover Illustrates the Importance of Reliable Financial Reporting

The JTA investigation provides a timely example of the challenges the new training is intended to address. The authority experienced repeated changes in financial leadership, including CFO Greg Hayes, successor Raj Srinath, interim CFO Heather Obora and current CFO Randall Bernard Barnes. Those transitions occurred as JTA developed budgets involving declining revenues, rising expenses and major transportation commitments.

Obora, previously JTA's chief procurement officer, was named interim CFO in July 2025 following Srinath's retirement. She held senior financial responsibilities during a period when the authority was developing plans to reduce spending and address projected deficits. By summer 2026, Barnes had arrived as the new CFO, and Obora returned to procurement leadership.

In September, after the larger financial crisis became public, JTA eliminated Obora's procurement position as part of its workforce reductions. Her departure has drawn attention because of her previous financial responsibilities, but there is no established finding that she caused the shortfall or was dismissed because of improper budgeting. Her precise role in preparing or revising the disputed financial projections remains an unresolved question.

Barnes has since participated in explaining the authority's financial condition to City Council. Investigators are examining how earlier budgets were constructed and whether the figures submitted by operating departments were altered after reaching JTA's CFO office. Those questions require a review of procedures and records across multiple executives' tenures.

The lesson for the mayor's training initiative is straightforward: board members need to understand financial reports, but they also need confidence that the figures were produced through reliable, documented and reviewable procedures.

October 23 Testimony Raises Questions About JTA's Budget Preparation

At the October 23 meeting of City Council's Financial Audit and Oversight Select Committee, Chair Chris Miller described testimony indicating that departmental budget submissions were changed within JTA's CFO office. He said figures originating from operating departments were altered after reaching finance leadership. The committee is examining those revisions as part of its investigation into the authority's financial crisis.

Budget revisions are not inherently improper. Finance offices routinely adjust departmental requests to reflect revenue limitations, management priorities and approved spending targets. The relevant questions are who authorized the changes, whether supporting explanations were retained and whether the revised figures accurately represented the organization's obligations.

Council members have also heard concerns involving underbudgeted labor, paratransit and NAVI expenditures. Those issues suggest the need to examine how spending commitments were incorporated into JTA's financial forecasts. A board cannot evaluate a realistic operating deficit if material costs are missing from the information presented.

This is where independent auditors may provide particularly valuable training. They can explain the importance of tracing budget figures to departmental submissions, reconciling forecasts with actual spending and documenting management adjustments. Those are practical oversight skills that go beyond simply interpreting a balance sheet.

Would the New Executive Order Have Prevented JTA's Crisis?

The question should become the central test of Deegan's proposal. Would the training and certifications required under the proposed reforms have identified JTA's financial problems before they developed into a major crisis? Or would board members have continued receiving reports whose underlying assumptions were incomplete or inadequately verified?

Financial literacy could improve oversight by helping board members recognize inconsistent projections, declining reserves, debt risks and unexpected spending increases. Executive certifications could clarify who is responsible for financial submissions. But neither measure guarantees that inaccurate assumptions will be discovered.

The City's own audit history illustrates why additional safeguards matter. Independent auditors identified material accounting corrections, inadequate reconciliations and weaknesses in financial controls even within Jacksonville's established Finance Department. Those findings demonstrate that professional financial management and independent verification serve different purposes.

The proposed training should therefore include more than general financial education. It should teach appointees how to use independent audit findings, demand reconciliations, evaluate corrective-action plans and identify discrepancies between budgets, actual spending and financial forecasts.

Deegan's Financial Oversight Plan Must Address City Hall's Own Audit Findings

Mayor Deegan's executive order acknowledges that independent-agency finances can affect Jacksonville taxpayers and that public board members need better tools to exercise oversight. That recognition is an important starting point. The proposal also creates an opportunity to establish clearer accountability for executives who submit financial information to the City.

But the independent audit record raises questions about the administration's own financial reporting and oversight procedures. Jacksonville's external auditors identified a material weakness in FY2025 reporting, while Council Auditor investigations documented weaknesses involving payments, grants, financial-system access and reconciliations. Several corrective actions remain important measures of whether the City's financial management is improving.

The administration has accepted findings and described corrective steps, and the external auditors issued an unmodified opinion on the City's final FY2025 financial statements. Those facts deserve recognition alongside the deficiencies. The question is whether the improvements are being independently verified and incorporated into the new oversight initiative.

Brosche's office can provide valuable financial expertise, while the Council Auditor and external auditors can contribute the independent perspective necessary to evaluate financial controls and reporting risks. A training program combining those functions would offer public board members a more complete understanding of their responsibilities.

If Jacksonville wants stronger oversight of its independent agencies, should the people who identify weaknesses in the City's own financial systems also have a defined role in teaching board members how to recognize them?

And before City Hall begins teaching independent agencies how to identify financial warning signs, should it demonstrate how the City is correcting the warning signs its own auditors have already documented?

Those questions are not arguments against Deegan's executive order. They are tests of whether the proposed reforms will produce meaningful accountability rather than another layer of government procedure.

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