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NYS Comptroller

THOMAS P. DiNAPOLI

Taxpayers' Guide to State and Local Audits

Audits of Local Governments and School Districts

Village of Amityville – Internal Controls Over Selected Financial Operations (2011M-280)


Released: April 6, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to examine the Village's financial operations and internal controls over selected financial activities for the period June 1, 2009, to November 30, 2010.

Background

The Village of Amityville is located in the Town of Babylon, on the south shore of Suffolk County. The Village Board of Trustees serves as the legislative body and is comprised of four elected trustees and an elected Mayor. The Village's general and capital fund expenditures totaled about $17.4 million for the 2009-10 fiscal year.

Key Findings

  • The Board has not adopted realistic budgets, does not routinely monitor the budget, and has not taken appropriate actions to maintain the Village's financial stability. For the 2008-09 and 2009-10 fiscal years, the Village overspent appropriations resulting in a decline in the Village's general fund balance from $1,880,880 at May 31, 2008 to a deficit of $603,888 at May 31, 2010 or by a total of $2,484,768 million.
  • The Board did not properly authorize or monitor capital projects and did not ensure that each capital project's financial records contain sufficient information to detect and prevent cost overruns. Consequently, the Village borrowed more than $450,000 from the general fund to finance various projects and the expenditures for four projects exceeded contract amounts by $122,420.
  • Internal controls over purchasing are not appropriately designed or operating effectively to safeguard Village assets.

Key Recommendations

  • Develop a comprehensive plan to address the declining fiscal health of the Village and to eliminate the deficit in the general fund.
  • Adopt resolutions authorizing the maximum estimated cost of each project at its inception and require periodic capital expenditure reports showing the authorization for each project, expenditures and encumbrances to date, and available authorizations.
  • Appoint a purchasing agent to ensure compliance with the Board's purchasing policy and ensure that personnel adhere to guidelines set forth in the purchasing policy regarding quotes.

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