Purpose of Audit

The objective of our audit was to assess the Town’s financial condition and analyze the health center’s direct and indirect costs for the period January 1, 2015 through March 30, 2016.

Background

The Town of Cherry Valley is located in Otsego County and includes the Village of Cherry Valley within its boundaries. The Town, which has a population of approximately 1,270, is governed by an elected five-member Town Board. The Town’s health center primarily serves the Town residents but also accepts patients from surrounding areas. The Town’s 2016 budgeted appropriations are approximately $1.7 million.

Key Findings

• The Supervisor is not maintaining separate accounting records for the health center’s activity and some costs are not allocated to the health center accordingly.
• Without planning for unexpected additional expenditures, the ability to continue operating the health center may be significantly hampered because of the Town’s current fiscal condition.

Key Recommendations

• The Supervisor should segregate the accounting records for the health center and allocate direct and indirect costs so the Board can properly evaluate the impact of the health center on the Town’s financial condition.
• The Board should assess the future operation of the health center and develop long-term plans to ensure the health center functions in the best interest of the Town’s residents.