Audits of Local Governments and School Districts
Village of Otisville – Accounting for Fire Protection Funds (2012M-157)
Released: November 23, 2012 -- [read complete report - pdf]
Purpose of Audit
The purpose of our audit was to examine the Village's records for fire protection district funds for the period June 1, 2010, through November 9, 2011.
The Village of Otisville is located in Orange County, and has a population of 1,068. The Village is governed by an elected Board of Trustees comprising a Mayor and four Trustees. The Village's 2010-11 budgeted general fund expenditures were approximately $965,000, and the fire department's expenditures were approximately $434,000.
We identified some improper accounting practices and questionable transactions relating to the Village's fire protection district funds.
- Cash disbursement records were not accurate and complete. The Deputy Clerk-Treasurer did not number checks in the accounting software in sequential order, and 204,265 check numbers were omitted from the accounts payable check registers for fiscal years 2009-10 and 2010-11. Similarly, 3,663 check numbers were missing from the 2009-10 and 2010-11 fiscal years' payroll check registers. We also found 22 instances of duplicate check numbers used.
- Village officials could not locate records authorizing the establishment of two fire reserves and the purpose and use of the reserves.
- The Board did not review the Deputy Clerk-Treasurer's work for accuracy, and did not audit the Clerk-Treasurer's accounting records, as required by Village Law.
- Ensure that the Deputy Clerk-Treasurer issues checks in sequential order and maintains a list of checks issued. Ensure that there is an independent review of all canceled checks, and investigate any checks that are missing and checks that have been issued with the same check number.
- Ensure that it has all resolutions for reserve funds on file to document that the reserves have been properly established. Ensure that all reserves are reviewed on an annual basis to assess if their balances are reasonable and close all reserves that have met their purpose and are no longer being used.
- Audit or cause an audit of the Clerk-Treasurer's records on an annual basis.
Local Government and School Accountability Contact Information:
Phone: (518) 474-4037; Email: firstname.lastname@example.org
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236