Audit finds flaws in former Cary manager’s leadership and financial practices
AI-generated summary reviewed by our newsroom.
- Audit finds leadership flaws and staff feared retaliation.
- Recommendations: anti-retaliation protections, surveys, stronger reporting.
- Investigations underway; audit flagged a missing $2.1M grant statement.
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Cary under scrutiny
The town of Cary has been in the spotlight since late November, when Town Manager Sean Stegall was put on administrative leave without any explanation from the town. Stegall resigned Dec. 13, 2025, amid reports of questionable spending. Here is ongoing coverage from The News & Observer.
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The annual audit requested by the Town of Cary and conducted by auditors Cherry Bekaert is nearing completion.
During the Town Council meeting on Thursday night, the findings were presented, revealing deficiencies in the “tone at the top” set by former town manager Sean Stegall.
Stegall stepped down as town manager in December after 10 years following revelations of financial issues, including a questionable land deal and the town paying council member Lori Bush’s tuition.
Audit Director Lee Ann Watters presented the results, recommendations and identified weaknesses from the audit.
“Your former town manager did not always adequately communicate the importance of compliance with policies and procedures, accountability, and other internal control responsibilities,” she said. “Unfortunately, we learned that employees did perceive that there was a risk of retaliation if they raised concerns.”
It was recommended that the town implement periodic anonymous surveys to get the tone of the culture and strengthen retaliation protections.
“We further recommend that you consider strengthening your reporting mechanisms,” Watters said to the council. “So what you might sometimes call whistle-blower mechanisms and particularly your anti-retaliation protections that are provided to employees.”
The independent auditor’s report comes while other entities are investigating the town following Stegall’s departure.
Cary town leaders will pay the Womble Bond Dickinson law firm up to $150,000 to examine Stegall’s and others’ spending with procurement cards and reimbursements, The News & Observer previously reported.
The North Carolina State Auditor’s Office is looking into alleged cases of fraud, waste and abuse of taxpayers’ dollars. The State Bureau of Investigation is also determining whether there is evidence to support a criminal investigation into Stegall.
Auditor’s recommendations
Other recommendations in the audit presented Thursday include implementing a comprehensive policy that defines permissible benefits for elected officials, such as allowable expenses for conferences, training or town business.
The town should also establish a dollar threshold requiring employees to reimburse the town for transactions made with a procurement card, known as a “P-Card,” exceeding that amount.
A missing financial statement detailing $2.1 million in grant expenses eligible for reimbursement was identified as an area of concern; Watters confirmed this issue was resolved.
Watters began her presentation by explaining that the audit’s purpose was to provide an opinion on the town’s financial statements as a whole and ensure they are materially accurate.
She anticipates the Town of Cary will receive a clean unmodified opinion, indicating the financial records are free from material misstatement.
Cary’s Finance Director Kimberly Branch echoed Watters and said the town has a strong financial position. Cary has focused on cash flow, strategic investment and existing assets.
“As a result, budget line items were monitored more closely and additional capital projects were closed out due to the reassessment work that council went through as part of the budget planning process, both of which supported a stronger operational bottom line for this year,” Branch said.
She added that the town is in a strong financial position, with $23.6 million added to the fund balance for the fiscal year, increasing the total to $106 million.
Mayor Harold Weinbrecht said he’s not expecting results of the outside investigations to be favorable.
“I have a feeling it won’t be very rosy, but we will hear from them,” he said. “We also have the DA and the SBI looking into things. I don’t know if they’ll find anything. We have no idea, no information, what’s going on with them. And then we have the internal investigation where they will try to come up with additional policy and procedure changes to make us stronger.”
The finished audit report is expected by Feb. 12 and will be included in the 2025 annual comprehensive financial report.
This story was originally published February 6, 2026 at 3:24 PM with the headline "Audit finds flaws in former Cary manager’s leadership and financial practices."
