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February 28, 2012

 

Comptroller DiNapoli Releases Municipal Audits


New York State Comptroller Thomas P. DiNapoli today announced his office completed the audits of the Bolton Fire District, Town of Ellicottville, City of Peekskill, Town of Providence and the Village of Orchard Park.

"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."

Bolton Fire District – Internal Controls Over Financial Operations (Warren County)
Although the board was aware that it was required to adopt procurement and investment policies and a code of ethics, it has not done so and did not provide any explanation for its failure to do so. The district did not contract with an IPA to perform an independent audit of its records for the 2007 to 2010 fiscal years, and the treasurer has not filed an annual financial report with OSC since 2006. The board did not require district officials to submit supporting documentation of all purchases that were made with the district’s credit card. Additionally, the board did not ensure that the treasurer reported and remitted payroll tax withholdings and the district’s share of payroll taxes in a timely manner.

Town of Ellicottville – Unauthorized Salaries (Cattaraugus County)
The board did not authorize salary changes for employees that were not covered by the town’s collective bargaining agreement. As a result, 10 employees received salary or wage increases totaling $23,246. The clerk, who processed the payroll, paid the amounts without formal authorization.

City of Peekskill – Internal Controls Over Leave Accruals (Westchester County)
The city did not have comprehensive written policies and procedures for leave time. As a result, 12 employees had negative leave time balances, two employees used leave time to which they were not entitled, and seven employees earned leave time that was not added to their balances. In addition, 33 employees who left the city were not deactivated in the payroll system, increasing the risk they could receive payments for leave time they are not entitled to.

Town of Providence – Financial Operations (Saratoga County)
The supervisor’s accounting records were in poor condition, and did not provide an accurate portrait of the town’s financial condition at any time, nor did they accurately state the fund balances. The supervisor annually filed the annual update document; however, the board has no assurance that the amounts reported were accurate because of the state of the accounting records. The budgets adopted by the board for 2010 and 2011 did not include appropriated fund balance as a funding source and misclassified debt service costs. The board did not require the supervisor to provide adequate monthly budget-to-actual comparison reports. The board did not properly audit claims prior to payment and has authorized the use of debit cards which circumvents the claims auditing process. Finally, town officials have not implemented policies and procedures regarding the sale of garbage bags and resident transfer station permits.

Village of Orchard Park – Water Operations (Erie County)
During the four year period reviewed, water losses totaled more than 105 million gallons. Using an average of $2.23 per thousand gallons paid to the Erie County Water Authority, auditors estimate the cost associated with this water loss is approximately $235,000. It is also possible that a portion of the unaccounted-for water is due to inaccurate meters or customers not being properly billed. As such, the village may be missing an opportunity to collect additional water user charges. For perspective, at a rate of $5.00 per thousand gallons billed to customers, 105 million gallons of water represents $526,000 in potential revenue.

 

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