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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 Lake Grove – Internal Controls Over Selected Financial Activities (2011M-292)


Released: May 23, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to examine the Village’s internal controls over selected financial activities during the period June 1, 2009, to January 31, 2011.

Background

The Village of Lake Grove is located in the Town of Brookhaven in Suffolk County and has a population of approximately 11,160 residents. The Village is governed by an elected Board of Trustees, which consists of a Village Mayor and four trustees. The Village’s general fund operating expenditures for the fiscal year ending May 31, 2010, were approximately $4.1 million.

Key Findings

  • Village officials did not always follow competitive bidding laws. For example, the Village paid $220,990 to two vendors and purchased a used garbage truck for $29,000 without soliciting competitive bids.
  • The Board does not audit each claim before directing the claims processing clerk to pay them. A Board member had a prohibited interest in contracts with the Village.
  • The Board did not adopt policies and Village officials did not establish written procedures for the collection, verification, and deposit of cash receipts.
  • The Justices did not ensure that the Court clerks performed monthly accountability analyses or bank reconciliations and did not provide adequate oversight of the work performed by the Clerks.
  • Village officials have not established a comprehensive computer policy and/or written procedures to ensure that the Village IT system was secure.

Key Recommendations

  • Comply with GML and the Board’s adopted procurement policy when procuring goods and services for the Village.
  • Audit and approve all claims before they are paid. Establish procedures to help detect and prevent the Village from entering into contracts in which an officer or employee has a prohibited interest.
  • Adopt policies and establish written procedures for the collection, verification, and deposit of cash receipts.
  • Ensure that the court clerks prepare monthly accountability reports, perform bank reconciliations on a monthly basis and ensure an adequate segregation of the court’s cash custody and recordkeeping duties.
  • Develop and implement comprehensive IT policies and procedures that adequately address all major areas of concern.

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