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November 12, 2008

 

DiNapoli's Office Completes Local Government Audits

State Comptroller Thomas P. DiNapoli today announced his office completed audits of the Town of East Greenbush, Essex Fire District #2, Fort Johnson Fire Company, Inc., Village of Salem, and village Enforcement of Unpaid Electric Charges.

“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 East Greenbush – Budget Review (Rensselaer County)
The significant revenue and expenditure projections in the tentative budget are reasonable. However, the 2009 budget does not reflect the fiscal action necessary to address the town’s accumulated deficit and the deteriorated financial condition that exists in the general and highway funds.

Essex Fire District #2 – Internal Controls Over Financial Operations (Essex County)
The district had a weak control environment. The board did not provide oversight in key areas of operations, maintain budgets below the district’s spending limit or establish internal control policies and procedures over financial operations or fuel usage. For example, the district’s fuel costs and usage increased substantially from $682 for 668 gallons in 2003 to $4,866 for 2,667 gallons in 2005. In 2007, after the new Board of Commissioners instituted better controls, fuel costs and usage decreased substantially to $502 for 176 gallons.

Fort Johnson Fire Company, Inc. – Internal Controls Over Cash Receipts and Disbursements (Montgomery County)
The board did not adequately monitor the company’s financial activities. We found that the company had a very weak control environment. The board did not audit or engage an accountant to audit the chairman’s records. The board did not properly audit claims prior to payment to ensure they represented proper company charges. There were $46,875 in claims and $33,073 in debit card purchases that lacked adequate documentation to prove they were valid company purchases. In addition, another $36,141 in claims contained no supporting documentation other than information on the corresponding bank statements.

Village of Salem – Internal Controls Over Selected Financial Operations (Washington County)
The village did not adequately monitor its fiscal affairs. This was evidenced by the board’s failure to segregate the duties of the Clerk-Treasurer or provide compensating controls, to require and receive adequate periodic financial reports necessary for making informed financial decisions, and to review and update the village’s investment policy. As a result, the board adopted a structurally imbalanced general fund budget, the Clerk-Treasurer’s accounting records were inaccurate and not up-to-date, and the village missed an opportunity to maximize interest income.

Enforcement of Unpaid Electric Charges – Covering the villages of Fairport (Monroe County), Rockville Centre (Nassau County), Sherburne (Chenango County), Solvay (Onondaga County), and Tupper Lake (Franklin County)
Auditors found that the villages were generally doing a good job at billing and collecting payment for the electric utility services they provide. However, there were opportunities for improvement. For example, consistent assessment of late fees would have resulted in an additional $16,300 in revenue for two villages. Further, offering a variety of payment methods, such as on-line or third-party credit card payment, could speed up the payment process and improve collections. The villages mailed out disconnection notices according to their policies, but they rarely charged reconnection fees when they were entitled to do so. Two villages could have collected $61,500 in additional security deposits to offset uncollected account balances.

Click here to view the audits above.

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

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