DiNapoli's Office Completes Local Government Audits
State Comptroller Thomas P. DiNapoli today announced his office completed the following audits: Village of Endicott – Budget Review (Broome County); Village of Hempstead – Budget Review (Nassau County); Town of Randolph – Controls Over Cash Receipts and Disbursements (Cattaraugus County); and Village of Brockport – Budget Review (Monroe County).
“My office’s audits of local governments improve their financial management practices,” DiNapoli said. “These audits are tools for local officials to make sure proper policies and procedures are in place to protect taxpayer dollars and provide the best possible service these taxpayer dollars can deliver.”
Village of Endicott – Budget Review
DiNapoli’s auditors found that the revenue and expenditure estimates in the proposed budget appear reasonable.
Village of Hempstead – Budget Review
DiNapoli’s auditors found the revenue and expenditure estimates in the proposed budget to be reasonable. However, the village should continue to monitor the revenues and expenditures in both the general fund and the water fund.
Town of Randolph – Controls Over Cash Receipts and Disbursements
Auditors from DiNapoli’s Office found that internal controls over cash receipts and disbursements are not appropriately designed or operating effectively. Opinions of the attorney general have established that the positions of town clerk and bookkeeper to the supervisor are incompatible and therefore should not be held by the same individual. In the town’s case, virtually all of the fiscal duties of the clerk’s office and supervisor’s office are performed by the clerk, resulting in a lack of segregation of duties. The clerk has performed all of these duties with little oversight by the board. Although the records contained evidence that annual audits were conducted, the records did not indicate the extent of the testing or the results of those audits, and the supervisor participated in the audit of his own records, which is prohibited.
Village of Brockport – Budget Review
Given the village’s precarious fiscal condition, auditors caution village officials that the proposed budget does not provide adequate resources to fully fund village operations and to handle any unforeseen events that may occur. For example, the village has experienced cash flow problems in the current fiscal year; given that the unreserved balance in the general fund is only about 2 percent of appropriations, it is likely that the village will continue to have cash flow problems in 2010-11. The proposed budget includes an 11.8 percent property tax increase; however, the board has reduced proposed tax increases in prior years without identifying alternate revenue sources or cost reductions – actions which aggravated the village’s deteriorating financial condition by consuming the fund balance. In addition, the proposed budget for 2010-11 underfunds retirement costs by $106,000 compared to the estimated bill provided to the village, and underestimates police overtime costs by about $86,000 compared to historical patterns. Village officials did not have plans in place to reduce actual costs to stay within these lowered budget provisions. Further, the proposed budget does not make any provision for pay raises that could result from ongoing negotiations, or for a contingency account that could help pay for such raises or for any unforeseen expenses.
If you have any questions or would like a comment from the Comptroller’s Office regarding these audits, please call the Press Office at 518-474-4015.