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June 8, 2010

DiNapoli’s Office Completes Local Government Audits

State Comptroller Thomas P. DiNapoli today announced his office completed the following audits: Town of Cicero – Internal Controls Over Cash Receipts (Onondaga County); Town of Clinton – Long-Term Planning for Wind Power Revenues (Clinton County); and Town of Tupper Lake – Fiscal Oversight and Internal Controls Over Selected Financial Activities (Franklin 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.”

Town of Cicero – Internal Controls Over Cash Receipts
DiNapoli’s auditors found that neither the board nor department managers had established written policies and procedures for recording and processing cash receipts within the Comptroller’s office or the Zoning and Planning Department. Town officials had not adequately segregated cash handling and recordkeeping duties, instituted compensating controls, or provided independent oversight of these units’ cash receipts activities. Furthermore, neither cash collection location had adequate procedures to ensure that employees recorded and promptly deposited all town moneys collected. These deficiencies were cited in an independent audit report issued during 2006. The board and department managers have not taken appropriate corrective action to address these identified control weaknesses.

Town of Clinton – Long-Term Planning for Wind Power Revenues
Auditors from DiNapoli’s office noted that the board did not develop a comprehensive, multi-year financial and capital plan, nor did they have any other mechanism in place to adequately address the town’s long-term operational and capital needs. The town’s need for long-term planning is especially important due to the significant change in town revenues, resulting from the construction of major wind power projects in the town. In 2007, a 100.5 megawatt windpark, consisting of 67 separate 1.5 megawatt wind turbines, was constructed within the town’s boundaries. As a result, the town received $1,438,788 in wind power related revenues during the period January 1, 2006 through July 31, 2009. Since 2007, the town has received an annual payment of $301,500 for host community fees and beginning in 2008 has received annual payments of $172,659 for payments in lieu of taxes and $34,532 for royalties.

Town of Tupper Lake – Fiscal Oversight and Internal Controls Over Selected Financial Activities
DiNapoli’s auditors noted that the supervisor assigned accounting duties to the town administrator, but did not provide sufficient oversight. Consequently, auditors found that the town’s accounting records were not complete, timely, or accurate. The accounting records’ inadequacy makes it impossible for the board to determine the financial condition of the town’s operating funds and to make informed financial decisions, and precludes preparing and filing accurate annual financial reports. The board did not establish comprehensive written policies and procedures to provide guidance and internal controls over cash receipts. Recreation and campground cash receipts were not properly accounted for, and town officials were unable to account for $900 of recreation cash collections. Internal controls over purchasing and the payroll process were inadequate.

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.


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