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April 25, 2012

 

Comptroller DiNapoli Releases Municipal Audits


New York State Comptroller Thomas P. DiNapoli today announced his office completed the audits of the Town of Duanesburg, Village of Endicott, Village of Herkimer, Village of North Collins, Village of South Blooming Grove and the Spencerport Fire District.

“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."

Town of Duanesburg – Financial Condition and Internal Controls Over Justice Court Operations and Information Technology (Schenectady County)
For fiscal years 2006 through 2010, the board adopted budgets that underestimated revenues by approximately $1.4 million and overestimated expenditures by approximately $235,000, contributing to annual operating surpluses that averaged nearly $195,000. Consequently, fund balances that the board appropriated as funding sources were never used. As of December 31, 2010, the town has accumulated unexpended surplus funds in the general fund totaling $2,032,986, or 224 percent of the ensuing year’s general fund budget. These significant idle moneys were not used to reduce the tax levy; in fact, the amount that the fund balance increased was nearly equal to the cumulative real property taxes raised, which totaled $979,377 during that time. Auditors also identified weaknesses in the justice court’s internal controls over financial operations. Finally, the town’s internal controls over information technology need to be improved.

Village of Endicott – Budget Review (Broome County)
Based on the results of the review, auditors found that the significant revenue and expenditure projections in the tentative budget are reasonable. The village has adopted a local law to override the tax levy limit in 2012-13.

Village of Herkimer – Budget Review (Herkimer County)
There are significant concerns with the village’s proposed budget. First, the village budget as proposed results in a tax levy that appears to exceed the village’s constitutional tax limit, which could result in reductions of $40,000 in other village revenue. In addition, the village has very limited fund balance and has proposed a limited contingency account. Auditors have identified at least $228,000 of expenses that are not included in the budget. Further, the budget does not make provisions for any possible cost increases that may result from collective bargaining agreements. The village’s finances are too precarious to adopt a budget that does not clearly account for all known expenses and contains revenues that are not within the constitutional limits.

Village of North Collins – Cash Disbursements (Erie County)
The board should improve its oversight over the village’s cash disbursements. The entire board does not audit all claims prior to payment as required, and village officials do not prepare a salary schedule detailing salary amounts the board approved for village officials and employees. The clerk-treasurer is the only full-time employee responsible for the village’s financial activity, and she performs incompatible duties. The board has not instituted compensating controls to provide sufficient oversight, or performed an annual audit of the clerk-treasurer’s records.  Further, the board does not receive monthly financial reports, and no one reviews the clerk-treasurer’s bank reconciliations.

Village of South Blooming Grove – Internal Controls Over Financial Operations (Orange County)
Prior to the formation of the village in 2006, the Town of Blooming Grove provided and managed water and sewer services for the current village residents. The village, upon its formation, assumed the responsibility of providing these services to about 1,000 households. The village’s purchasing policy does not require the use of competition when procuring professional services. Therefore, village officials did not use competitive methods to obtain services for water and sewer. Instead, the village continued to use the vendor that provides services to the Town of Blooming Grove. The village pays the vendor approximately $250,000 per year.

Spencerport Fire District – Internal Controls Over Financial Operations (Monroe County)
The board generally provides adequate oversight of district financial activities. Even with adequate oversight, there is a certain level of inherent risk that exists with district cash disbursements. Due to this inherent risk, auditors reviewed all 217 cash disbursements, totaling approximately $532,000, made during four randomly selected months. Auditors also reviewed all bank statement activity for our audit period, ensured that all non-check withdrawals were appropriate, and reviewed bank reconciliations for two randomly selected months during the audit period.  Generally, the financial activity was properly recorded and supported, and disbursements appeared to be for proper district purposes.


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