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Taxpayers' Guide to State and Local Audits

Audits of Local Governments and School Districts

Town of German Flatts – Board Oversight (2012M-17)


Released: April 13, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to evaluate the Board oversight of the Town’s financial operations for the period January 1, 2010, to September 30, 2011.

Background

The Town of German Flatts is located in Herkimer County. The Town is governed by an elected Town Board, which comprises the Town Supervisor and four Board members. For the 2011 year, the Towns budgeted expenditures were approximately $2.2 million.

Key Findings

  • The Board did not authorize the wages paid to highway employees or the part-time assessor totaling $405,292. The Supervisor also increased the salaries of seven employees by a total of $15,044 without seeking Board approval, and without informing either the Board or the public of the additional payments.
  • The Board did not ensure that the Town’s financial activity was accurately recorded and did not take appropriate action to maintain taxpayer equity. Town officials did not allocate highway expenditures to the highway-outside Village fund or the Town-wide highway fund based on the type of service provided as required by law.
  • The Board did not perform complete annual audits of the records and reports of the officers and employees who received or disbursed cash.

Key Recommendations

  • Establish pay rates, by resolution, for all officials and employees and do not pay any official or employee any amount in excess of the amount authorized by the Board.
  • Ensure the bookkeeper allocates all costs to the proper tax base based on the actual services performed.
  • Conduct an effective annual audit of the records and reports of all officers and employees who received or disbursed moneys during the preceding fiscal year or hire an independent auditor to conduct the audits.

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