Audit Objective
Did the City of Fulton (City) Clerk-Chamberlain maintain accurate and up-to-date financial records?
Audit Period
January 1, 2024 – May 12, 2026
We extended the audit period to July 9, 2026, to determine the status of the City’s Annual Financial Report (AFR) filings and certified public accountant (CPA) compiled financial statements.
Understanding the Audit Area
The Clerk-Chamberlain is responsible for maintaining complete, accurate and up-to-date financial records, providing the Common Council with timely, accurate and comprehensive financial reports and filing the required AFR with the Office of the New York State Comptroller (OSC). This critical function helps maintain public trust, ensure compliance with legal requirements and prevent mismanagement, waste and fraud by providing the Council with reliable financial information needed to effectively oversee the City’s financial operations, monitor its financial condition, and make informed decisions. Timely filing of the AFR also promotes transparency and accountability by providing officials, taxpayers and other stakeholders with reliable financial information.
For 2026, the City’s budgeted appropriations totaled $27.1 million.
Audit Summary
While the City had two different Clerk-Chamberlains1 during the audit period, the former Clerk-Chamberlain did not maintain accurate and up-to-date financial records and, therefore, did not properly report the City’s financial position and activity to the Council each month or file the City’s 2022 and 2023 AFRs with OSC in a timely manner. The current Clerk-Chamberlain has made progress towards improving the records, but the errors we identified during the audit have not been corrected and the City’s 2024 and 2025 AFRs have not been filed.
The Clerk-Chamberlains could not provide the Council with reliable financial reports because of unrecorded and improperly recorded transactions. For example, we identified approximately $9.9 million in transactions that were not properly recorded or not properly accounted for in the City’s accounting records. As a result, the Council lacked the information necessary to effectively manage the City’s financial condition.
As of May 2026, the Clerk-Chamberlains had not reconciled bank accounts since December 2022. Cash balances in the financial records were not accurate, with differences between recorded cash and adjusted bank balances for 21 of the City’s 22 bank accounts (95 percent), as of December 2024. In total, cash in the financial records was $1.0 million (20 percent) lower than the City’s $5.0 million adjusted bank balance.
The former Clerk-Chamberlain did not make necessary cash transfers between the City’s bank accounts. Specifically, transfers related to 2024 routine collections and disbursements activity totaling $5.3 million were not completed or otherwise accounted for (i.e., shown as amounts due to or from other funds). This may explain why some individual cash accounts did not reconcile, but does not explain why cash was off in total.
Our testing also identified $1.6 million in unrecorded retirement expenditures, and $1.8 million in collections and $1.2 million in disbursements that the former Clerk-Chamberlain did not properly record. These issues were not identified or corrected, in part, because the Clerk-Chamberlains did not reconcile any of the City’s bank accounts during the audit period.
Additionally, the former Clerk-Chamberlain did not maintain adequate financial records for the City’s capital projects. As a result, the records could not be used to determine each project’s complete financial history or current position. While the current Clerk-Chamberlain has begun to set up new projects with appropriate accounts, the accounting records for older projects have not been corrected.
This report includes 10 recommendations that, if implemented, will strengthen the City’s financial recordkeeping and reporting practices and help provide the Council with complete, accurate and timely financial information needed to effectively oversee and manage the City’s financial condition. City officials agreed with our recommendations and their response is included in Appendix B.
This audit was conducted pursuant to Article V, Section 1 of the State Constitution and OSC’s authority as set forth in Article 3 of the New York State General Municipal Law (GML). The audit’s methodology and standards are included in Appendix C.
The Council has the responsibility to initiate corrective action. A written corrective action plan (CAP) that addresses the findings and recommendations in this report should be prepared and provided to OSC within 90 days, pursuant to Section 35 of GML. For more information on preparing and filing the CAP, please refer to the OSC brochure, Responding to an OSC Audit Report, which was provided with the draft audit report. The Council is encouraged to make the CAP available for public review in the Clerk-Chamberlain’s office.
1 The current Clerk-Chamberlain was appointed on July 1, 2025. The former Clerk-Chamberlain served from June 30, 2022 until June 30, 2025.