Audit Objective
Did the Kerhonkson Fire District (District) Board of Fire Commissioners (Board) provide adequate oversight of District financial activities?
Audit Period
January 1, 2024 – March 12, 2025.
We extended our audit period to review the District’s 2008 through 2024 Annual Financial Report (AFR) filings as of March 12, 2025.
Understanding the Audit Area
A board of fire commissioners, responsible for the general management and control of a fire district’s financial operations, must provide adequate oversight of the financial activities to ensure public funds are managed with accountability, transparency and integrity. This critical function can help maintain public trust, prevent mismanagement, waste, fraud and legal non-compliance.
The District’s budgeted appropriations totaled $310,411 for the 2025 fiscal year. The District paid 227 claims totaling $275,324 during the audit period.
Audit Summary
The Board did not provide adequate oversight of the District’s financial activities and was not transparent. The District’s required AFR was last filed in 2007, more than 18 years ago. As a result, the Board, taxpayers, New York State Office of the State Comptroller (OSC) and other interested parties have been denied the ability to assess the District’s financial standing.
In addition, because the Board did not request or review the Treasurer’s financial records, there was an increased risk that errors and irregularities could occur and go undetected. Additionally, the Board’s inadequate review of claims led to claims potentially being paid without sufficient budgetary appropriations being available. Because the Board did not adopt financial policies and plans and the individual members of the Board did not complete the required fiscal training, the Board’s ability to set long-term financial priorities and goals was limited. As a result, the Board hindered its ability to make informed financial decisions and cannot ensure taxpayers and other interested parties that the District’s financial activities are adequately accounted for and reported.
Specifically, the Board did not:
- Audit the Treasurer’s records in accordance with New York State Town Law (Town Law) Section 177.
- Ensure the Treasurer prepared and provided the Board with monthly bank reconciliations.
- Request, and the Treasurer did not provide, monthly budget-to-actual reports. As a result, the Board approved expenditures without available appropriations and overspent five appropriation budget lines totaling $50,792, or 43 percent more than budgeted.
- Ensure the Treasurer filed the District’s AFR with the OSC for 17 fiscal years (2008 through 2024).1
- Perform an adequate audit of claims prior to approving the claims for payment. We reviewed 11 claims totaling $46,075 and the Board did not properly audit all 11 claims. For example, 10 claims totaling $45,792 had no evidence that quotes were obtained to demonstrate that the purchases complied with the District’s procurement policy, which required officials to obtain competitive quotes.
- Develop and adopt required policies, including an investment policy, and ensure established policies are adequate.
- Develop and adopt written multiyear capital and financial plans to anticipate and prepare for infrastructure repairs, future purchases and asset upgrades.
- Ensure all members of the Board completed the mandatory fiscal oversight training within the required time period.
The report includes 12 recommendations that, if implemented, will improve the Board’s oversight of the District’s financial activities. District officials agreed with our findings and recommendations and indicated they plan to initiate corrective action.
We conducted this audit pursuant to Article V, Section 1 of the State Constitution and the State Comptroller’s authority as set forth in Article 3 of the New York State General Municipal Law. Our methodology and standards are included in Appendix C.
The Board has the responsibility to initiate corrective action. Pursuant to Section 181-b, of New York State Town Law, a written corrective action plan (CAP) that addresses the findings and recommendations in this report must be prepared and forwarded to our office within 90 days. To the extent practicable, implementation of the CAP must begin by the end of the next fiscal year. For more information on preparing and filing your CAP, please refer to our brochure, Responding to an OSC Audit Report, which you received with the draft audit report. We encourage the Board to make the CAP available for public review.
1 OSC’s website provides more information on AFR nonfilers and the District’s current AFR filing status at: https://web.osc.state.ny.us/localgov/afr-non-filers/.