Audits of Local Governments and School Districts
Town of Copake – Financial Oversight and Information Technology (2011M-284)
Released: April 6, 2012 -- [read complete report - pdf]
Purpose of Audit
The purpose of our audit was to examine internal controls over selected Town financial operations for the period January 1, 2010, to December 31, 2010.
The Town of Copake is located in Columbia County. The Town is governed by an elected five-member Town Board comprising the Town Supervisor and four Board members. In the 2010 fiscal year, the Town's operating expenditures were approximately $793,000 for the general fund and $1,026,000 for the highway fund.
- The Board has not developed written policies and procedures for online banking or entered into an adequate agreement with its financial institution, and there is an inadequate segregation of duties with online transfer capability.
- The Board does not conduct an adequate audit of claims, payroll registers were not certified, and the Town's payroll processing company keeps an electronic copy of the Supervisor's signature which it uses to sign the payroll checks.
- The Board has not adopted policies and procedures for data backup, developed a formal disaster recovery plan, or instituted breach notification procedures.
- Several Town employees have access to areas of the financial software that are not consistent with their job responsibilities.
- Adopt an official policy for online banking and electronic transfers. Enter into an online banking and transfer agreement with its bank that complies with GML. Realign online transfer functions so that the ability to execute online transfers is restricted to employees in the Supervisor's office.
- Develop detailed written procedures to guide and govern the processing of claims against the Town. Certify that services indicated on the payrolls were actually performed. Require the payroll processing company to return payroll checks to the Town unsigned.
- Adopt formal IT policies and implement procedures to effectively safeguard the Town's IT resources.
- Periodically review user access rights to the financial software functions to ensure that users have access only to those functions that are consistent with their job responsibilities.
Local Government and School Accountability Contact Information:
Phone: (518) 474-4037; Email: email@example.com
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236