Audit Objective
Determine whether the Roosevelt Fire District (District) Board of Fire Commissioners (Board) properly monitored the District’s length of service award program (LOSAP).
Key Findings
The Board did not effectively monitor all aspects of the District’s LOSAP. Specifically, the Board did not ensure that the LOSAP was annually audited in accordance with New York State General Municipal Law (GML) Section 181-b, or in the alternative, ensure LOSAP disclosure notes were included in the District’s annual audit.
During the audit period, the value of the District’s LOSAP assets declined. As a result, the District’s annual contributions to the LOSAP had to steadily increase to ensure that there were enough assets to cover all benefits paid to the LOSAP participants and beneficiaries.
By obtaining an annual LOSAP audit or alternatively ensuring LOSAP disclosure notes in a timely manner, the Board increases its ability to thoroughly monitor the LOSAP. Prudent management of LOSAP assets can help minimize costs to taxpayers, as well as protect the “pension-like” benefits earned by the volunteers. Given that most LOSAP plans require investment and actuarial expertise, it remains important that the plans be reviewed by the Board, as part of the annual audit process, to help protect the benefits earned by the volunteers for service to their communities.
The Board also could not demonstrate that the procurement of LOSAP investment management services was made in accordance with the District’s procurement policy.
Key Recommendations
- Ensure that the District obtains an annual audit of the LOSAP, or in the alternative, include LOSAP disclosure notes in the District’s annual audit.
- Comply with the District’s procurement policies and procedures when seeking to contract for LOSAP investment management services.
District officials agreed with our recommendations and have initiated or indicated they plan to initiate corrective action.