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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 Canton – Internal Controls Over Records and Reports and Financial Condition (2012M-90)


Released: August 3, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to evaluate the Village's financial operations for the period June 1, 2010, through May 31, 2011.

Background

The Village of Canton is located in the Town of Canton, St Lawrence County. The Board of Trustees is the legislative body consisting of four trustees and the Mayor, who are responsible for the Village's overall management and fiscal oversight. Budgeted appropriations for the fiscal year ended May 31, 2011, were approximately $3.0 million in the general fund, $968,000 in the water fund, and $1.5 million in the sewer fund.

Key Findings

  • The Clerk-Treasurer did not maintain accurate computerized accounting records and reports, which impaired the Board's ability to monitor the Village's financial operations. Although the Mayor reviewed all bank statements and cancelled checks, the Board did not ensure that timely bank reconciliations were properly performed. In addition, as of May 31, 2011, the Village's two main bank accounts had not been reconciled for more than two years.
  • The Board did not have procedures in place to ensure that the annual financial reports are completed and filed timely. The latest annual reports for May 2008 and 2009 were both filed in 2011. The 2010 and 2011 reports remain unfiled.
  • Due to the poor condition of the Village's general ledger accounting records, the amounts of the Village's unexpended surplus funds or deficit fund balances were not readily available. However, based on our review of the Village's operations, it appears that at May 31, 2011, the general fund had an excessive surplus fund balance while the sewer fund had a deficit fund balance.

Key Recommendations

  • Maintain accurate and timely accounting records and reports. Ensure that bank reconciliations are performed timely and that all discrepancies are investigated and corrected immediately.
  • Ensure that the Clerk-Treasurer files the Village's annual financial reports within the prescribed statutory period.
  • Prepare an accurate estimate of the unreserved fund balance at the end of the fiscal year for the Board's consideration in developing the ensuing year's budget. Use the surplus fund balance in the general fund in a manner that benefits Village taxpayers.

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