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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Summit Fire District – Internal Controls Over Financial Operations (2013M-264)


Released: November 22, 2013 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to determine whether District controls are adequate to ensure that financial activity is properly recorded and reported and that District moneys are safeguarded for the period January 1, 2012, to July 26, 2013.

Background

The Summit Fire District is a district corporation of the State, distinct and separate from the Town of Summit, and is located in Schoharie County. The Board of Fire Commissioners consists of five elected members. The District’s general fund budget totaled $127,000 for the 2013 fiscal year.

Key Findings

  • The District does not have adequate financial policies and procedures. The Board has not adopted purchasing, investment, or code of ethics policies, as required by statute.
  • While the Board generally provided adequate oversight over cash disbursed from the general fund, it did not provide the same oversight of cash disbursed from the District’s building reserve account. For example, the Board did not review or approve any disbursements being made out of this checking account; it allowed the Treasurer to generate, sign and disburse checks with little to no oversight. While the Treasurer maintained a file that contained the bank statements, vendor invoices and copies of disbursement checks from the building reserve account, the Treasurer did not provide this file to the Board for its review. We also found that the Board did not audit claims from this account, because the Treasurer did not prepare claim vouchers for the Board’s review prior to moneys being disbursed from the account.
  • The Treasurer did not prepare monthly bank reconciliations for the building reserve account activity, but submitted monthly financial reports to the Board and filed the required annual financial report with the Office of State Comptroller.

Key Recommendations

  • Adopt a procurement policy, an investment policy and code of ethics, as required by statute.
  • Ensure that all disbursements made follow the established review and approval procedures currently being followed for general fund disbursements.
  • Require that the Treasurer complete monthly bank reconciliations for all District bank accounts.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236