Jeff Davis County’s financial audits document recurring accounting failures under Treasurer Dawn Kitts, culminating in a finding that the county’s fiscal 2025 accounting and financial reporting problems constituted a material weakness.
The latest audit, issued Sept. 17, 2026, required 39 adjusting entries to prepare the county’s accounting records for financial statements that complied with generally accepted accounting principles. Auditors attributed the problem primarily to insufficient monthly and year-end review by the treasurer’s office.
The finding follows years of warnings about accounting practices, budget compliance and financial oversight. Records document accounting concerns dating to at least 2022, when Kitts acknowledged that she had posted transactions to incorrect cash accounts.
The reports distinguish between shortcomings attributed directly to the treasurer’s office and broader county failures involving purchasing officials, department heads and the Commissioners Court. They also document improvements: Four other findings from fiscal 2024 were not repeated as deficiencies in the latest audit.
But the central accounting problem persisted and received a more serious classification.
A material weakness means there is a reasonable possibility that a significant error in the financial statements will not be prevented or detected and corrected promptly. The county’s accounting and financial reporting problem had been classified as a less severe significant deficiency in the preceding audit.
For fiscal 2025, auditors said the treasurer’s office needed to review accounting records more thoroughly throughout the year and conduct a comprehensive review before submitting them for the annual audit.
They identified several areas requiring attention: grant accounting, payroll accruals, unpaid bills, reconciliation of accounting-system cash balances with bank balances, and incorrectly posted transactions.
Those are functions that affect whether county officials have reliable information when making spending and budget decisions.
Auditors warned that some internal financial reports generated during fiscal 2025 might have been inaccurate. They also said the extent of the adjustments encroached on the audit firm’s ability to remain independent of the county.
That warning did not say the firm had lost its independence. It identified a concern arising from the amount of corrective accounting work needed during the audit.
The firm recommended that the county treasurer improve accounting and financial reporting and continue receiving outside accounting assistance.
Similar recommendations had appeared before.
The fiscal 2024 report reproduced a fiscal 2023 finding that a significant number of adjustments were needed to prepare the county’s books for external reporting. That finding attributed the problem primarily to the treasurer’s office needing a more thorough year-end closing process.
The report said the condition remained present in fiscal 2024.
Auditors acknowledged in the 2024 finding that the number of necessary adjustments had improved over a two-year period. Nevertheless, they continued to warn that internal reports might have been inaccurate and recommended regular outside accounting assistance.
Kitts’ earlier responses show that the county had already been working on those problems.
In the corrective action plan accompanying the 2022 audit, she said she was working with Malynda Richardson to address problems involving the county’s accounting software and her own posting of transactions to incorrect cash accounts. She described the work as ongoing and expressed satisfaction with its progress.
The fiscal 2024 corrective action plan again described work to straighten out funds and accounts.
Kitts, identified as the contact person for all five findings in that report, said having a second employee would give her more time to examine reports and accounts. She also described plans for monthly checks intended to improve the next audit.
The following fiscal year’s accounting finding was classified as a material weakness.
Budget compliance was another recurring concern.
The fiscal 2024 report’s summary of prior findings said the county exceeded its fiscal 2023 General Government appropriation by $48,562 and its Capital Outlay appropriation by $43,724. Necessary budget amendments had not been brought to commissioners for consideration and approval.
That condition recurred in fiscal 2024, when General Fund capital outlay exceeded appropriations by $44,384 and transfers out exceeded appropriations by $366,873.
Those amounts represent expenditures and transfers above their authorized budget allocations. They do not establish that the money was stolen or missing.
Auditors recommended that departments monitor their budgets monthly and that the treasurer’s office provide monthly or at least quarterly comparisons of budgeted and actual spending.
The reports also show that responsibility for responding to budget problems extended beyond the treasurer.
In her response to the 2022 budget finding, Kitts said she had repeatedly warned the county judge and EMS director about the EMS budget being exceeded, but no action was taken. That was her explanation in the corrective action plan, rather than an independently established conclusion about those officials’ conduct.
For fiscal 2024, her corrective action response said she was trying to identify needed budget amendments more consistently.
The latest audit reported that budget overages were not encountered again in fiscal 2025.
The 2024 audit also identified weaknesses in credit card oversight.
Auditors examined a Chase credit card statement closing July 6, 2024, containing 14 charges by county personnel. Six charges, about 43% of that sample, lacked supporting invoices or receipts.
For charges with supporting records, auditors found no indication of management review or approval, or additional explanations of the business purpose where needed.
The finding concerned the transactions sampled. It did not establish that 43% of all county credit card purchases lacked documentation or that the sampled purchases were personal expenses.
Auditors said practices were not in place to hold card users accountable for submitting required documentation, making it harder for the treasurer’s office to determine proper accounting classifications and whether charges were allowable.
They recommended documented business purposes, receipts, department approval and a designated monthly reviewer.
A separate finding said the county lacked a process for documenting, reviewing and approving journal entries used to adjust its general ledger.
The fiscal 2025 audit reported improvement in both credit card controls and journal entry documentation. Neither was repeated as a deficiency finding.
The 2024 report also found that a $70,375 purchase of a 2023 Dodge Ram 3500, identified in the audit as a vehicle for the sheriff’s office, failed to comply with state purchasing requirements.
According to auditors, the officials who made the purchase mistakenly believed obtaining quotes was sufficient. The report did not identify Kitts as the official who selected the vehicle or made the purchasing decision.
Although she was listed as the contact for the county’s corrective action response, that designation alone does not establish personal responsibility for the procurement violation.
The fiscal 2025 audit said that purchasing condition was not observed again.
The latest corrective action plan says the county has hired a county auditor for fiscal 2026-27 who will assist with the fiscal 2025-26 and 2026-27 audits. It says the treasurer will learn from the new auditor how to check accounts throughout the year.
That plan describes the county’s proposed response. It does not establish that the recurring accounting weakness has been resolved.
Both the fiscal 2024 and fiscal 2025 audits issued unmodified opinions on the county’s financial statements, meaning the completed statements fairly presented its finances in all material respects under applicable accounting standards.
Those opinions coexist with the findings about the underlying accounting process. The auditors could conclude that the final statements were fairly presented after adjustments while still identifying serious weaknesses in how the county maintained its books.
The documented record is one of repeated accounting deficiencies, promises of corrective action and improvement in several financial controls — followed by an escalation of the accounting problem most directly attributed to the treasurer’s office.
