The Spruce Pine Town Council voted to hire a new auditing firm last week.
Town Manager Daniel Stines informed the council that town staff had consulted with the North Carolina League of Municipalities to find an accounting firm that is suitable for auditing small town finances and settled on Carter, P.C.
“This is a dedicated auditing firm with a dedicated auditing division — this division does not switch over to taxes in January,” Stines said. “We think they’ll do a fantastic job.”
The contract with Carter is for $42,500.
“Audits should be filed in December, not last month,” Stines said.
The council heard the results of the town’s 2025 audit at a previous meeting in May. At the time, Town Manager Daniel Stines said that the town was looking for a new auditing firm.
Audit issues
The council heard a report on Spruce Pine’s 2025 audit from accountant Jason Carpenter. Carpenter works with Combs, Tennant & Carpenter, a certified public accounting firm with offices in Boone and Newland.
Carpenter noted that the need for quick procurement during the unexpected disaster recovery period following Hurricane Helene (downgraded to a tropical storm after slowing down over land) had an impact on the town’s financial procedures, leading to several audit findings.
“So keep in mind, we've had a very unusual year this year with the hurricane — this audit is going to be very different than what's been in the past,” Carpenter said.
Carpenter noted that changes in staffing also could cause issues. In 2025, two different town finance managers stepped down.
“With everything we've had and all the changes we've had this year, you're going to have some findings,” he said. “You had a lot of changes this year, but the staff changes, with the flood, like I said, this year will be the same way — you're going to have a lot of changes this year. It's going to take you several years to get back to normal.”
Town Hall response
Stines said that his staff has been going over the audit and working to improve procurement processes and other issues, and he had prepared a response to send to the state explaining how the auditors’ concerns have been addressed.
“We go through and address each of the deficiencies that were found in the financial summaries,” Stines said.
Stines noted that the town is working to improve investment in water and sewer utilities.
“Some of the highlights are the water and sewer capital asset ratio is below 50 percent,” he said. “This is generally related to a lack of investment in your capital assets and (28:11) infrastructure for a town.”
Stines said that the town’s new budget addresses some of these problems.
“Upgrading infrastructure, upgrading assets within the water sewer system as well vehicles and things and equipment to be able to better serve those services for the citizens,” he said.
The town manager also noted that rapid staff turnover in the months following Helene exacerbated some of the town’s financial issues.
“Another deficiency is over expenditure of budgeted funds,” Stines said. “The town over-expended (the) FY2025 (budget) during disaster relief. During FY2025, the town experienced 100 percent turnover of both administrative and financial related functions.”
Both the town manager and finance manager stepped down a few months after Hurricane Helene.
“An interim was appointed to the role for three months and a permanent replacement was appointed in February of 2025,” Stines said. “While the newly-appointed finance officer had served in the county government finance role, she was new to the director of finance position, lacked key experiences in several facets of municipal finance operations, utility and FEMA management. Utility clerk and customer service specialists were also replaced between September and October.”
Stines said that the new finance manager left abruptly in September 2025, and was replaced with a new finance manager “who has an MBA and a moderate level of accounting background in 20 years of data analytics.”
That new finance manager, Brian Hobson, has now been working for the town for almost a year.
“The finance officer identified several inefficiencies including the preaudit function which serves as a safeguard against over-expending appropriations,” Stines said. “The purchase order system was rudimentary.”
Stines also said the town is pursuing additional training and safeguarding to improve financial procedures.
“Brian, our new finance officer, has already enrolled, as has myself, in the UNC School of Government and Finance, our officer classes,” he said. “Brian will certainly outpace me, but once completed, we'll both have our certificates for budgeting and local government finance from the UNC School of Government.”