Richmond’s outside auditor has uncovered a $12.8 million error that has inflated the amount of surplus the city has reported for several years, the Free Press has been told.

According to the information, the error was found in an account that relates to the fund balance, an untouchable savings account that reportedly topped $110 million in the 2020-21 fiscal year that ended June 30.

As described, $12.8 million mistakenly was added to the account several years ago. Until the mistake was caught, that money continued to roll over each year

so that it artificially added to the savings balance, according to the information the Free Press received.

CliftonLarsonAllen, or CLA, the firm that has provided auditing services to the city for five years, discovered the mistake while reviewing the city’s cash position in preparing for the annual audit, the Free Press was told.

City Finance Director Sheila White and Lincoln Saunders, the city’s chief administrative officer, have not responded to a Free Press request for comment.

The finding that the fund balance has been overstated for several years has emerged as Mayor Levar M. Stoney’s administration continues to struggle to complete the Comprehensive Annual Financial Report, or CAFR, for the 2020-21 fiscal year that ended June 30.

As a candidate, Mayor Stoney made completing the annual audits a priority and expressed pride that his administration was able to do so since he took office in 2017 in contrast to the delays that occurred under his predecessor, Dr. Dwight C. Jones.

However, as he completes the first year of his second term, Mayor Stoney and his administration are finding it tougher to finish the audit.

Members of City Council have not made an issue of the delay.