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March 10, 2011

 

Comptroller DiNapoli Releases Municipal Audits


New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of the Broome-Tioga-Delaware County Health Insurance Consortium, the City of Mechanicville and the North Bellmore 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."

Broome-Tioga-Delaware County Health Insurance Consortium, Segregation of Duties
The consortium treasurer's cash disbursement duties were not adequately segregated. In addition to receiving and paying claims invoices, the treasurer recorded those transactions and maintained custody of all cash assets. She also executed all electronic transfers. Although the administrator verified the activity listed in each month's bank statement, this practice will detect issues only after they arise. Further, the administrator was an employee of the law firm, whose salary was paid through the claims audit process, thus providing an interest in the claims he was reviewing. Finally, because the treasurer did not maintain cash records, consortium officials were unable to verify that the cash balances were accurate.

City of Mechanicville, Internal Controls Over Payroll (Saratoga County)
Except for minor deficiencies, auditors generally found that the city's system of internal controls over Department of Public Works' timekeeping had been adequately designed and was operating effectively.

North Bellmore Fire District, Internal Controls Over Financial Operations (Nassau County)
District officials did not properly segregate the superintendent's duties or have mitigating controls in place. As a result, the superintendent processed cash disbursements, prepared bank reconciliation, wire transfers, and employee time entries without board oversight. The board did not obtain the necessary number of quotes when procuring goods and services for five purchases. Additionally, the district did not use competitive proposals to obtain services, and district officials incurred travel expenses which exceeded recommended reimbursement rates.


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