New York State Comptroller Thomas P. DiNapoli today announced the following local government audits were issued.
The board did not provide adequate oversight of district financial activities. The board did not establish compensating controls over the work of the treasurer, who was responsible for receiving and disbursing cash, signing district checks and maintaining the accounting records. The board also did not audit district claims prior to payment and conduct an annual audit of the treasurer’s records. In addition, the board did not ensure the treasurer filed required annual financial reports for 2017 through 2019 and they did not complete mandatory fiscal oversight training. Auditors reviewed all $44,227 disbursements made during the audit period and found that they were for proper district purposes.
The city treasurer did not properly enforce and the common council did not properly monitor delinquent water, sewer and tipping fee balances. The treasurer did not follow the enforcement procedures prescribed by the city code.
The justice collected, deposited, disbursed, recorded and reported the fines and fees we reviewed in an accurate and timely manner. During the audit period, the justice deposited cash receipts totaling $25,398 and made disbursements totaling $30,398. Auditors reviewed a sample of 42 cash receipts totaling $7,307 and all disbursements totaling $30,398.
Town officials did not always use a competitive process to procure goods and services. Officials did not develop detailed procedures for procuring professional services in their procurement policy. Auditors also found officials did not seek competition for professional services obtained from eight service providers. In addition, officials did not competitively bid for sanitation services totaling $186,821.
The board did not provide adequate oversight to ensure that financial activities were properly recorded and reported. They did not properly manage fund balance. The treasurer did not maintain adequate accounting records or provide regular financial reports to the board. She also did not file required annual financial reports with the Office of the State Comptroller in a timely manner. The 2017 through 2019 annual reports were filed between 331 and 1,018 days late. The board did not audit all claims prior to payment and did not annually audit the treasurer’s records. In addition, the board did not adopt realistic budgets based on historic trends. The district ended 2019 with $345,000 in surplus fund balance — enough to fund nearly two years’ of expenditures. Auditors project the district will end 2020 with a surplus of about $308,800 (177% of 2021’s budget).
The board did not effectively manage the town’s financial condition. They did not have a clear understanding of the laws governing the finances of the general fund tax bases and did not have an understanding of the finances for the closed landfill. In addition, the board did not treat taxpayers equitably when budgeting for and allocating certain revenues and expenditures in the “town-wide” and “town-outside-village” general funds. Town-wide funds are used for the benefit of residents of the entire town, including the village. Town-outside-village funds are used only for the benefit of residents in the portion of the town that lies outside of the village. The board also adopted unrealistic budgets and did not maintain reasonable levels of fund balance. They also did not adopt a multiyear financial and capital plan or detailed reserve plan. The board’s ability to effectively manage the town’s financial condition is further hampered by not requiring regular financial reporting.
The board did not ensure that information technology (IT) assets were adequately safeguarded. The board also did not adopt any IT policies or a disaster recovery plan. They did not provide users with cybersecurity awareness training. In addition, the board did not ensure the financial software, town clerk’s software and justice court software had the necessary controls to maintain data integrity. Sensitive IT control weaknesses were communicated confidentially to officials.
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