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March 31, 2009

 

DiNapoli's Office Completes Municipal Audits

New York State Comptroller Thomas P. DiNapoli today announced his office completed the audits of the City of Oswego – Medicare Part D Retiree Drug Subsidy, and the Village of Keeseville – Financial Condition and Purchasing (Clinton and Essex counties).

“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.”

City of Oswego – Medicare Part D Retiree Drug Subsidy
The city did not participate in the Retiree Drug Subsidy program during our audit period. Auditors estimate that the city could realize an annual net subsidy of $106,200 by participating. It is too late for the city to obtain the subsidy for the 2007 or 2008 fiscal years because the application deadlines have expired. However, the city could realize this amount in future years, if it applies for the program on a timely basis and continues to provide equivalent drug coverage and drug usage remains at 2007 levels. After auditors discussed tentative findings with city officials, they submitted an application to participate starting in 2009. This application has been approved.

Village of Keeseville – Financial Condition and Purchasing
The board overestimated budgeted revenues, resulting in actual revenues falling short of the amounts needed to fund the budget. The board also adopted budgets that relied upon the availability of unreserved fund balance as a funding source to finance operations in its general, water and sewer funds. The combination of these factors has resulted in declining financial trends over the past four fiscal years. The combined unreserved fund balances of the general, water, and sewer funds declined from $273,125 on June 1, 2004 to a deficit of $20,634 as of May 31, 2008 and has significantly impaired the village’s financial flexibility and operations. In addition, auditors’ review of the village’s cash flow disclosed that the water and sewer funds routinely had negative balances that were subsidized by informal borrowings from the general fund within a commingled bank account. The board also did not comply with the village’s procurement policy and did not competitively bid items as required by the General Municipal Law (GML) Finally, proceeds from the sale of scrap metal were used to purchase various items for village use, but the transactions were not recorded in the village’s accounting records, and some of the items did not appear to be valid village expenses.

Click here to view the audits above. If you have any questions or would like a comment from the Comptroller’s office regarding these audits, please call 518-474-4015.


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