Internal Controls Over the Town Clerk’s Office and Purchasing
We found that approximately $12,400 in cash was diverted and not deposited by the Town Clerk’s Office. As of the completion of our fieldwork, the Erie County District Attorney’s Office was investigating this matter. We also found that Town officials did not always adhere to competitive bidding requirements or to the Town’s procurement policy. Finally, We tested 38 claims totaling $36,619 to determine if they were properly authorized, itemized, had evidence of receipt of the goods or service, included proper supporting documentation and were approved for payment by the Board. Although we found that tested claims generally met these requirements, we discussed certain exceptions with Town officials. Town of Alden[complete audit - pdf]

Internal Controls Over Selected Town Operations
The Town did not properly allocate highway payroll expenditures and tax revenues between the town-wide and town outside village funds for the 2008 fiscal year, resulting in town-wide and town outside village fund balances being over and understated by $97,000, respectively. We also found that Town officials had not solicited bids for purchases totaling more than $190,000 in 2008 and 2009. Finally, the Highway Superintendent did not ensure that fuel supplies were adequately safeguarded and accounted for. We found that approximately 34 percent of the fuel purchased is not accounted for. Town of Antwerp[complete audit - pdf]

Internal Controls Over Financial Condition and Town Clerk Receipts
Because the Supervisor and the Town Clerk did not ensure that all necessary financial records were maintained and that all financial activity was reported accurately and timely, as required, the Board did not receive adequate information on which to base its financial decisions and consequently it failed to adequately monitor the Town’s financial operations and the operations of the Town Clerk, respectively. In addition, internal controls over cash receipts in the Town Clerk’s office were not appropriately designed or operating effectively. Our accountability at June 25, 2009 showed an overage in the Town Clerk’s account of $8,587. Town of Belfast[complete audit - pdf]

Financial Condition and Internal Controls Over Selected Financial Operations
The Board has not adopted a policy nor have Town officials developed procedures to govern the level of unreserved, unappropriated fund balance to be maintained and/or to determine whether the amount maintained is reasonable. At fiscal year end December 31, 2008, the unreserved, unappropriated fund balance in the general fund was reported as $938,586; 103 percent of the ensuing year’s total budget and in the highway fund at $332,174; 26 percent of the ensuing year’s highway budget. In addition, the Town has established reserve funds for medical expenses totaling $69,136 without the legal authority to do so. Internal controls over the Supervisor’s records and reports need to be improved. The Board also did not conduct a proper audit of claims or records. Our review of 14 claims totaling $94,070 found that 11 claims totaling $23,133 lacked evidence of department head approval, 10 claims totaling $90,565 lacked evidence of receipt, and one claim totaling $16,921 included an overpayment of $1,741. Finally, although there was evidence that Town officers and employees presented their books and records to the Board, Board members did not have any documentation to indicate that a proper audit of Town records was actually conducted. Town of Berne[complete audit - pdf]

Justice Court
We reviewed Justices Shea’s and McBride’s records and reports and found that internal controls over Court operations were not designed appropriately or operating effectively to properly account for financial transactions. Accountabilities reconciling Court assets to known liabilities were either not prepared or were inaccurate; Justices did not always make deposits intact and in a timely manner, and the Board did not report the extent of testing or the results of its audit of Court records. These weaknesses increase the risk that Court funds could be misidentified, lost or misused. Town of Bethany[complete audit - pdf]

Internal Controls Over Cash Receipts
Neither the Board nor department managers have established written policies and procedures for recording and processing cash receipts within the Comptroller’s Office or the Zoning and Planning Department. Town officials have not adequately segregated cash handling and recordkeeping duties, instituted compensating controls, or provided independent oversight of these units’ cash receipts activities. Furthermore, neither cash collection location had adequate procedures to ensure that employees recorded and promptly deposited all Town moneys collected. These deficiencies were cited in an independent audit report issued during 2006. The Board and department managers have not taken appropriate corrective action to address these identified control weaknesses. Town of Cicero[complete audit - pdf]

Financial Condition and Internal Controls Over Selected Financial Operations
The Board has not adopted a policy nor have Town officials developed procedures to govern the level of unreserved, unappropriated fund balance to be maintained and/or to determine whether the amount maintained is reasonable. At fiscal year end December 31, 2009, the general fund unreserved, unappropriated fund balance was reported at $322,688, 102 percent of the ensuing year’s total budgetary appropriations of $316,395. The highway fund unreserved, unappropriated fund balance was $175,279, 64 percent of the ensuing year’s total budgetary appropriations of $274,215. Collectively, these factors have contributed to the highway fund levying more property taxes than necessary to fund operations. The Town also spent about $100,750 for professional services without seeking competition and did not enter into written agreements with these service providers. Finally, Town officials donated $10,000 that were not appropriate because they were for events considered social in nature, which did not further legally authorized Town purposes. Town of Clermont[complete audit - pdf]

Long-Term Planning for Wind Power Revenues
The Board did not develop a comprehensive, multi-year financial and capital plan, nor did they have any other mechanism in place to adequately address the Town’s long-term operational and capital needs. The Town’s need for long-term planning is especially important due to the significant change in Town revenues, resulting from the construction of major wind power projects in the Town. In 2007, a 100.5 megawatt windpark, consisting of 67 separate 1.5 megawatt wind turbines, was constructed within the Town’s boundaries. As a result, the Town received $1,438,788 in wind power related revenues during the period January 1, 2006 through July 31, 2009. Since 2007, the Town has received an annual payment of $301,500 for host community fees and beginning in 2008 has received annual payments of $172,659 for payments in lieu of taxes and $34,532 for royalties. Town of Clinton (Clinton County)[complete audit - pdf]

Internal Controls Over Financial Operations
Internal controls were not established to ensure the Town’s financial activity was accurately recorded and reported on a timely basis. The bookkeeper attempted to keep track of Town finances, but lacked the training and experience to adequately do so. As a result, financial operations were deficient because the Supervisor failed to maintain complete and accurate financial records and did not submit, along with other officers and employees of the Town, his records to the Board for the required annual audit. The lack of complete and accurate accounting records limits the Board’s ability to make informed financial decisions and the lack of Board oversight exposes Town assets to the risk of fraud and abuse without detection by Town officials. Finally, internal controls over fuel inventory and usage were not appropriately designed to adequately safeguard the Town’s fuel. Neither the Superintendent nor the golf course manager maintained adequate inventory records. Town of Elizabethtown[complete audit - pdf]

Unauthorized Payments and Lack of Board Oversight
Based on our examination of the Town’s bank account activity from 2004 to 2009, approximately $378,000 in Town funds was misappropriated on 347 checks that were drawn payable to the former Supervisor or his wife. Shortly after the completion of our fieldwork in April 2010, the former Supervisor’s wife was indicted on 350 counts related to the theft of approximately $378,000 of Town funds. From 2004 to 2009, the Town Board failed to exercise appropriate oversight over the Town’s financial activities. It did not establish an effective system of internal controls to ensure that cash was safeguarded and that all transactions were supported and recorded. By approving the purchase of a signature stamp for the former Supervisor in March 2007, the Town Board actually increased the risk associated with incompatible duties. The former Supervisor’s wife admitted in a sworn statement to using this signature stamp to sign unauthorized checks to the former Supervisor and herself. Town of Fairfield[complete audit - pdf]

Sales and Use Tax Revenues and Town Clerk Cash Receipts
Since 2004, the Town has incorrectly budgeted and accounted for sales and use tax revenues totaling $206,222 through 2009 in the town-wide funds. Consequently, the revenues were not credited to the town-outside-village funds where they could have been used to reduce the real property taxes levied. After we brought this to the attention of Town officials, the Board correctly adopted the 2010 budget without budgeting for sales and use taxes in the town-wide funds. The Board should now seek legal counsel to determine what remedies are available to address the inequities that have occurred prior to 2010. We also found that internal controls over the Clerk’s cash receipts should be improved. For example, the Clerk did not issue duplicate receipts for collections that were received from January 2009 to December 2009 totaling $10,578. Town of Franklinville[complete audit - pdf]

Internal Controls Over Personal, Private and Sensitive Information
The Board did not establish adequate policies and procedures to safeguard personal, private and sensitive information (PPSI). Consequently, we found that Town personnel were using social security numbers as employee identifiers on paper and electronic correspondence that was routinely prepared and distributed by department managers. In addition, Town personnel in several departments collected credit card, driver’s license, checking account, and PPSI that was not necessary for business purposes and/or not properly secured. Lastly, the Town has not performed a town-wide data classification, adopted a breach notification policy or provided information security awareness training to safeguard PPSI. Further, internal controls over information technology are not appropriately designed and operating effectively. Town of Glenville[complete audit - pdf]

Tax Collector
The Collector’s system of recording tax payments does not allow her to easily identify if there has been an error or omission in recording a tax payment. Although the Collector can compare the daily bank deposits to the receipts recorded in the daily cash book, there is no way for the Collector to compare the receipts recorded in the daily cash book, which are recorded by the date of receipt, to the tax roll book which is organized by tax bill number. As a result, at the time of settlement with the County Treasurer in 2008 and 2009, the Collector was unable to identify the sources of surplus balances of approximately $8,000 and $8,550, respectively. Town of Hancock[complete audit - pdf]

Internal Controls Over Selected Financial Operations
The Board has not established written procedures governing cash receipts or provided sufficient oversight over Town officers and employees who receive cash on the behalf of the Town. Because there is no policy or procedure governing issuing cash receipts, the Town Clerk and other Town employees did not issue receipts for cash transfers and transactions, including $18,320 worth of construction and demolition disposal fees and $5,130 in vending machine water sales in 2008. Also, the Board and the Supervisor have not established an adequate segregation of the Town Clerk’s duties related to water rents receipts. Finally, the Town’s two water districts (#1 and #2) did not repay interfund advances totaling $209,138 transferred from the general fund by the close of the fiscal year in which they were made, as required by General Municipal Law. Town of Henderson[complete audit - pdf]

Justice Court
We reviewed the Justices’ records and reports and found that generally, internal controls were appropriately designed and operating effectively, and that the Justices properly maintained their accounting records. However, we found that Justice Lovell did not prepare written bank reconciliations or monthly accountability analyses. Although the accountability analysis we performed as of October 2, 2009 did not find any significant discrepancies, it is important that Justices maintain documented bank reconciliations and prepare monthly accountability analyses to identify errors that may occur in a timely manner. Town of Hinsdale[complete audit - pdf]

Internal Controls Over Town Operations
During fiscal years 2006 to 2008, Town officials inaccurately reserved an average of $14.3 million per year in fund balance for purchase orders that did not support actual Town obligations. During the 2007 and 2008 fiscal years, the Town Comptroller, following a long-standing practice, incorrectly charged a total of $9,958,007 of revenues and expenditures to the wrong funds, which resulted in an inequitable tax levy on certain taxpayers. In addition, poor accounting for capital projects in the early 1990’s led to deficits in the capital projects fund of $3,324,744 that have never been resolved, and the Town was expending bond proceeds for purposes other than those intended.

Cash transactions were not posted in a timely manner, cash receipts books were not controlled, blank checks were not secure, and 22 duplicate receipt books were missing. As a result, a cash shortage of at least $12,250 occurred and was not detected.

Employees received leave time and other fringe benefits without Board authorization, resulting in the Town incurring over $111,000 in unauthorized expenses. The Town also inappropriately provided three independent contractors with health insurance coverage through the Town’s participation in the New York State Health Insurance Program. Finally, Town personnel did not solicit competition when procuring the services of 18 professional service providers who were paid $1,154,094. Town of Islip[complete audit - pdf]

Internal Controls Over Selected Financial Operations
Although the Board adopted a Code of Ethics, they did not establish adequate procedures to prevent conflicts of interest from occurring. The Town Supervisor and the Deputy Town Supervisor had prohibited interests in contracts with companies with which the Town did business. During our audit period, the Town paid more than $87,500 to these two companies combined. In addition, Town officials did not properly segregate duties or implement compensating controls over cash disbursements and payroll processes. Town of Lansing[complete audit - pdf]

Internal Controls Over Selected Operations
Internal controls over the Town’s highway payroll were inadequate. There was no prior Board approval for a raise given to one highway employee, resulting in a $1,400 unauthorized increase in his 2008 wages. One employee improperly received a separation payment of $2,900, and three employees accrued sick time up to 14 days in excess of the Board-authorized limit. In addition, the Town made payments totaling $11,000 to four private organizations which were prohibited. The Town also improperly provided up to $7,200 in services to two other organizations without ensuring that these services were for a valid Town purpose. The Town did not comply with General Municipal Law for the purchase of $65,548 in fuel, and could have saved $6,400 through State contract. Finally, the Superintendent did not ensure that fuel supplies were adequately safeguarded and accounted for. Town of Lenox[complete audit - pdf]

Internal Controls Over Selected Financial Activities
The Town improperly paid $20,000 in December 2007 to an incorporated fire company for the stated purpose of purchasing a generator, but which Town officials told us was a loan to the fire company with no generator actually received. In June 2008, the Town received $20,000 from a resident to whom the Town had granted a special-use permit with the condition that he donate $20,000 to the fire company. The payment of taxpayer moneys is improper without a statutory or contractual obligation to do so, or without receiving any goods or services in return for the payment. Further, the misleading record of the transaction intentionally circumvented internal controls and compromised the transparency of Town operations. In addition, the Board did not properly audit claims, instead delegating this responsibility to two Board members. We also found that Town officials did not properly bid two purchases totaling approximately $90,500. Finally, the Town spent over $182,000 for professional services procured without the benefit of competition, and did not have formal written agreements with the providers. Town of Marilla[complete audit - pdf]

Wastewater Capital Project
The Town did not properly plan the Wastewater Infrastructure Capital Improvement Project (Project). As a result of Town officials’ poor planning and their use of a contract that did not protect the Town’s interests, the Project’s costs have grown from $22.1 million to approximately $47 million. Moreover, the Project is still not complete and the Town will incur additional costs. Furthermore, Town officials did not fully inform taxpayers of the entire costs at the outset of the Project to enable them to make informed decisions concerning the Project. We also found that the Board did not follow the New York State Energy Law (Energy Law) when procuring an energy performance contract. The Town now owes $37,500 in fines for failing to remedy a sewage overflow problem that the Project was designed to correct. Town of Orangetown[complete audit - pdf]

Internal Controls Over Selected Financial Operations
The Town does not have procedures in place to ensure that all moneys received by the Clerk are properly receipted, correctly recorded and deposited intact, which creates a risk that receipts could be handled inconsistently or inappropriately. Town officials also have not established procedures to analyze the difference between the amount of water pumped into a particular water district and the total amount billed to residents. Therefore, officials did not know that the 22 percent water loss in the Versailles Water District far exceeded the acceptable water loss percentage of 10 percent. Finally, the Town does not separately account for or adequately monitor water district capital project transactions. Instead, the Town accounts for capital projects within two of the water district operating funds. In addition, the accounting records do not reflect over $962,000 in loans and $107,000 in interfund liabilities for these projects from 2008, thus overstating the financial position of these activities. Town of Perrysburg[complete audit - pdf]

Financial Condition
The Town has experienced significant signs of fiscal stress and deterioration in its financial condition. Over the last three years, the general fund balance has declined by $247,410 to a deficit fund balance of $9,404, as of December 31, 2009. In addition, the town-outside-village highway fund has experienced an unplanned operating deficit of $39,000 in 2009, which caused a decline in fund balance to $124,240. However, because the Board appropriated $155,000 of fund balance in the 2010 budget, this will create a potential deficit of $30,760 in the town-outside-village highway fund for the 2010 fiscal year. These deficiencies were caused by the Board’s failure to ensure that budgets were realistic and properly monitored. Despite the declining fund balances, the Board has not developed a comprehensive financial plan to restore the Town’s fiscal standing. As a result, the Town’s financial condition is likely to continue to deteriorate, which will limit the ability of Town officials maintain adequate services and to manage emergencies and other unanticipated occurrences. Town of Philipstown[complete audit - pdf]

Internal Controls Over Billed Receivables
We found weaknesses in the Town’s internal controls over water and sewer billed receivables. The Board had not established written policies and procedures for the billing, collecting and accounting for water and sewer billed receivables. Further, we found that the Town failed to reconcile the detailed customer account and billing records maintained by the Water and Wastewater Department to the Accounting Department’s records. The Town also did not adequately monitor the operations of its two ambulance districts, including the collection of fees imposed upon users of its ambulance districts’ services by the service providers. Town of Plattsburgh[complete audit - pdf]

Internal Controls over Water and Sewer Operations
The water and sewer clerk’s duties are not properly segregated and the Board did not implement any compensating controls to mitigate the lack of segregation of duties. In addition, adequate receipts are not always issued when water and sewer bills are paid. The clerk also makes billing adjustments with no oversight. We also found that the Town does not have a system in place to reconcile the total amount of water purchased and processed to the amount of water billed to its customers and used for municipal purposes. The lack of an overall comparison increases the risk that the Town may be paying more than necessary for water or, that water may be lost within the system or misused without being detected by Town officials. As a result, the Town cannot account for over 11 million gallons of water valued at over $34,000. Town of Pomfret[complete audit - pdf]

Controls Over Cash Receipts and Disbursements
Internal controls over cash receipts and disbursements are not appropriately designed or operating effectively. Opinions of the Attorney General have established that the positions of Town Clerk and bookkeeper to the Supervisor are incompatible and therefore should not be held by the same individual. In the Town’s case, virtually all of the fiscal duties of the Clerk’s office and Supervisor’s office are performed by the Clerk, resulting in a lack of segregation of duties. The Clerk has performed all of these duties with little oversight by the Board. Although the records contained evidence that annual audits were conducted, the records did not indicate the extent of the testing or the results of those audits, and the Supervisor participated in the audit of his own records, which is prohibited. Town of Randolph[complete audit - pdf]

Internal Controls Over Selected Financial Activities
Internal controls over purchasing and information technology were not appropriately designed and operating effectively because the Board did not provide sufficient oversight over the purchasing process and the Board and Town officials did not establish adequate policies and procedures to address the possible loss or misuse of the Town's information technology (IT) system and computerized data. In addition, we reviewed internal controls over the police payroll and found them to be appropriately designed and operating effectively. Town of Rotterdam[complete audit - pdf]

Internal Controls Over Selected Financial Operations
The Town of Rotterdam Industrial Development Agency (RIDA) Board members did not establish specific criteria for evaluating projects and documenting their approval decisions and, therefore, the public has no assurance of a consistent and fair process being used. In addition, RIDA officials did not have applications on file, as required by policy, for two projects, and did not receive an application for another project’s PILOT revision. They also did not verify key information included on the applications prior to project approval. Additionally, the Board did not adequately monitor project performance to ensure that approved projects were meeting their goals. RIDA officials also did not effectively monitor compliance with PILOT agreements and sales tax exemption applications. Finally, RIDA’s 2008 annual financial report was not complete and accurate. Town of Rotterdam Industrial Development Agency[complete audit - pdf]

Town Clerk’s Office
We found that the former Town Clerk did not accurately record and deposit all moneys collected, resulting in a shortage of over $50,000. She has admitted to the Town Supervisor and Deputy Town Clerk that she embezzled Town funds for the last eight years. We also found that the Town has not adopted comprehensive policies and procedures relating to user access rights. The Town officials and employees had full access to all financial applications. We calculated a shortage of approximately $27,800 for water rents during our audit period, this is over half of the total shortage we identified. For this reason, it is important that user access rights in the financial application be based on the needs of particular job duties. Town of Sodus[complete audit - pdf]

Highway Fund Purchasing and Financial Condition
The Superintendent purchased $100,000 of overpriced highway supplies even as $83,000 in inventory remained unused, and admitted to accepting $2,000 in gift-card kickbacks from the vendor who sold him $84,000 of those supplies. On September 23, 2009, the Superintendent was charged with counts of receiving a reward for official misconduct (a Class E felony) and official misconduct (a Class A misdemeanor). The Superintendent’s unethical behavior was enabled by the Board’s failure to provide proper oversight of highway purchasing activities. Finally, the Board adopted budgets that were not structurally balanced, and relied on the appropriation of nonexistent fund balance and advances from the general fund to finance highway operations. As a result, the unreserved highway fund balance declined from $68,000 on December 31, 2004 to a deficit of $162,000 on December 31, 2008, a decrease of approximately $230,000 (340 percent) over four years. Town of Ticonderoga[complete audit - pdf]

Fiscal Oversight and Internal Controls Over Selected Financial Activities
The Supervisor assigned accounting duties to the Town Administrator, but did not provide sufficient oversight. Consequently, we found that the Town’s accounting records were not complete, timely, or accurate. The accounting records’ inadequacy makes it impossible for the Board to determine the financial condition of the Town’s operating funds and to make informed financial decisions, and precludes preparing and filing accurate annual financial reports. The Board did not establish comprehensive written policies and procedures to provide guidance and internal controls over cash receipts. Recreation and campground cash receipts were not properly accounted for, and Town officials were unable to account for $900 of recreation cash collections. Internal controls over purchasing and the payroll process were inadequate. Town of Tupper Lake[complete audit - pdf]

Financial Management
The Board has not adopted budgets that were based on realistic estimates of revenues and expenditures. As a result, fund balances that were appropriated as funding sources were not used, and the Town has accumulated general and highway unreserved, unappropriated fund balances totaling $1,035,143 and $285,261, respectively, which are excessive in comparison to the Town’s expenditure levels. Furthermore, the excessive fund balances do not include an additional $220,000 that is being held in four reserve funds that Town officials have no long-term plans to use. We found that the vast majority of real property taxes raised in the past 10 years were not needed. Town of Wales[complete audit - pdf]

Internal Controls Over Selected Financial Operations
The Town’s fund balance in the general and highway funds steadily declined from 2006 to 2008, resulting in a general fund deficit of over $525,000 in 2008, a total decline of $4.3 million in the general fund, and a decline in fund balance of over $1.9 million in the highway fund due to poor budgeting. For example, in the general fund, the budgeted amount for police personnel services was overspent by more than $740,000 in 2008; legal contractual expenditures went over budget by over $236,000 in 2008; and building contractual expenditures were over budget by more than $112,000 in 2007. In addition, Town officials did not have documentation to show that they solicited competition through a request for proposal (RFP) or quotation process for the services of eight of 14 vendors who were paid a total of $1,764,554. Furthermore, there were no contracts for eight of the vendors, who were paid a total of $1,018,082. Finally, the Town has an excessive number of open bank accounts; it has 41 bank accounts in 11 different banks with deposits totaling $9,981,557 as of October 22, 2009. Town of Wallkill[complete audit - pdf]