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December 10, 2010

 

DiNapoli: Selden Fire District Needs Better Control Over Cash Transfers



The Selden Fire District failed to establish written procedures for wire transfers or enter into written agreements with banks for wire transfers and, as a result, made 35 wire transfers totaling more than $2 million without obtaining proper authorization, according to an audit released today by New York State Comptroller Thomas P. DiNapoli.

“Money is tight; every local government has to watch every tax dollar,” DiNapoli said. “The Selden Fire District put tax dollars at risk. Two million dollars in wire transfers without proper authorization is a gamble the district should not have made. This isn’t good for the fire district, and it isn’t fair to the taxpayers. The district must do a better job overseeing its financial operations.”

In addition, the district made 15 payments, totaling $93,125, without proper auditing of the claims by the board, as required, prior to the distribution of payments. Because of deficiencies in the documentation, DiNapoli’s auditors were also unable to determine when payments totaling $693,084 were audited.

District officials also failed to follow district purchasing policies when buying goods and services. Consequently, district officials did not publicly advertise for bids for a truck costing $34,897, or televisions and audio systems totaling $25,420. Additionally, proposals or quotes were not obtained for accounting and auditing services from three firms, totaling $42,895.

DiNapoli recommended that the board and district officials:
  • Establish written rules and procedures for wire transfers and enter into written agreements with banks for authenticating wire transfers;
  • Adopt written procedures for claims processing that require the board to audit all claims prior to payment. Such an audit should include verification that the claims are for appropriate and necessary purposes, contain adequate supporting documentation, and are authorized for travel;
  • Publicly advertise for bids, for purchases and public work contracts in excess of competitive bidding thresholds, modify the purchasing policy to require the use of competition in the procurement of professional services; and
  • Ensure district staff complies with the procurement policy when purchasing goods and services that are not subject to competitive bidding.

District officials generally agreed with DiNapoli’s recommendations, and indicated they planned to take corrective action.

For a copy of this report, visit here.



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