Audits of Local Governments and School Districts
Hamilton College Sewer District – Internal Control Over Sewer District Financial Operations (2012M-161)
Released: November 30, 2012 -- [read complete report - pdf]
Purpose of Audit
The purpose of our audit was to review internal controls over District financial operations for the period January 1, 2010, to December 31, 2011.
The Hamilton College Sewer District is a special district created in 1910 and is located in the Town of Kirkland in Oneida County. The District is governed by a Board of Sewer District Commissioners, comprising three members who are appointed by the Kirkland Town Board. Operating expenditures of the District were approximately $169,000 for the year ended December 31, 2011.
- The Board has not segregated the duties of the Clerk who is responsible for maintaining the customer file, preparing and mailing sewer bills, and collecting, recording and preparing deposits.
- Although the Treasurer does periodically review the Clerk's sewer billing and receipt records, there are no procedures to ensure that all customers are billed accurately or that all payments are deposited in the same form as received.
- The District overbilled customers by $8,400 and underbilled customers by $500.
- The Board does not review supporting documentation for claims or cash balances reported by the Treasurer.
- Establish procedures for someone independent from the billing process to periodically compare the master customer list to the billing records and spot-check bills to verify they are complete and accurate.
- Establish a master customer list to ensure all customers are accounted for. Any changes to the master customer list should be made by someone independent of the billing process.
- Ensure that any overbilled customers are properly credited and that customers who were underbilled are properly billed.
- Audit claims prior to payment and ensure that all claims contain appropriate supporting documentation and are for valid District purposes. Review monthly bank reconciliations prepared by the Treasurer along with the related bank statements and canceled checks.
Local Government and School Accountability Contact Information:
Phone: (518) 474-4037; Email: firstname.lastname@example.org
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236