Audit Objective
Did the Town of Cato (Town) Supervisor (Supervisor) maintain complete, accurate and up-to-date accounting records and reports?
Audit Period
January 1, 2022 – November 6, 2025.
We extended our audit period to review the Town’s 2017 through 2024 Annual Financial Report (AFR) filings as of November 6, 2025.
Understanding the Audit Area
A town supervisor must maintain complete, accurate and up-to-date accounting records and reports for informed decision-making, legal compliance, accountability and transparency. These records are essential for a town board and officials when monitoring a town’s financial health, making sound fiscal decisions, ensuring that the town complies with various laws and maintaining the public’s trust.
The Supervisor, as chief fiscal officer, is responsible for receiving, disbursing and retaining custody of Town money, maintaining accounting records and providing financial reports to the Town Board (Board).
The Town’s budgeted appropriations for 2025 totaled $2.27 million.
Audit Summary
The Supervisor did not maintain complete, accurate and up-to-date accounting records and reports. As a result, the Board lacked reliable records and reports to effectively manage the Town’s financial operations. Furthermore, there is an increased risk of theft, waste and abuse of Town resources.
The Supervisor assigned his duties of maintaining accounting records and preparing disbursements and financial reports to an appointed bookkeeper without providing adequate oversight. The lack of oversight resulted in errors and deficiencies in the Town’s accounting records remaining undetected and uncorrected. These errors and deficiencies included $348,817 in receipts and $744,572 in disbursements that were not recorded in the accounting records or reported in the monthly reports provided to the Board.
The bookkeeper also prepared inadequate bank reconciliations that identified large unreconciled differences, which were not investigated, and indicated the financial records maintained by the bookkeeper on the Supervisor’s behalf were incomplete and inaccurate. Had the Supervisor ensured that bank reconciliations were properly prepared for all accounts and reviewed, recording errors in the accounting records may have been identified. We confirmed that these variances were most likely due to unrecorded transfers between bank accounts and nine handwritten checks totaling $7,403 that were not recorded. Due to the recording errors, the monthly financial reports, including the Supervisor’s report of receipts and disbursements and budget-to-actual report prepared by the bookkeeper and presented to the Board, were also incomplete and inaccurate. Furthermore, the Supervisor’s payroll records were inaccurate because he did not perform an adequate payroll certification, including reviewing supporting documentation for all employees paid. As a result, one employee was overpaid $2,600.
In addition, the Supervisor did not file the Town’s AFR, as required by New York State (NYS) General Municipal Law (GML) Section 30, since 2017.1 While the bookkeeper filed the 2017 AFR in August 2022, it was filed more than four years late. However, as of November 6, 2025, the 2018 through 2024 AFRs remained unfiled.
The report includes 10 recommendations that, if implemented, will improve the Supervisor’s records and reports. Town officials generally agreed with our recommendations, and their response is included in Appendix B.
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. A written corrective action plan (CAP) that addresses the findings and recommendations in this report should be prepared and provided to our office within 90 days, pursuant to Section 35 of the New York State General Municipal Law. 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 in the Town Clerk’s office.
1 More information on AFR non-filers and the Town’s current AFR filing status can be found on OSC’s website at https://web.osc.state.ny.us/ localgov/afr-non-filers/.