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September 15, 2011

 

Comptroller DiNapoli Releases Municipal Audits

New York State Comptroller Thomas P. DiNapoli today announced his office completed audits for Warren County, Olcott Fire Company, Inc., Town of Arcade, Corfu Fire District, City of Corning, Town Justice Courts and the Montezuma No. 1 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."

Warren County - Internal Controls Over Payroll and Maintenance of Leave Records
Payroll staff duties were not adequately segregated, and the treasurer did not provide sufficient oversight to mitigate the risk of erroneous or inappropriate transactions. The treasurer’s two payroll employees prepared and processed the county’s payroll without management review or verification of their work. Further, because the board did not establish a countywide time and attendance policy, departments maintained inconsistent time records, and time records did not always reflect the actual employee time worked.

Olcott Fire Company, Inc. - Internal Controls Over Financial Activities (Niagara County)
Controls over the company’s financial activity were nonexistent. The board exercised no oversight of the treasurer’s duties and did not audit bills or approve payments as defined in the company by-laws. Charge card usage was not monitored or restricted. The treasurer did not maintain even the most basic accounting records. As a result, the company could not substantiate 193 disbursements totaling $67,744 in fiscal year 2010 and there was no documentation to indicate the purpose of $15,662 in payments to related parties in 2009 and 2010.

Town of Arcade - Tax Collector (Wyoming County)
In general, the tax collector properly received, deposited and recorded tax payments. However, the tax collector was not remitting taxes to the supervisor in a timely manner and the collector’s bank account has large unexplained balances of as much as $12,500.

Corfu Fire District - Controls Over Financial Operations (Genesee County)
The board did not provide adequate oversight of the district’s financial activities. The board did not ensure that the annual financial reports were filed for the last three fiscal years as required by law. Moreover, while at least two commissioners review and sign every claim, the board consistently failed to identify problems with charges made to the district’s credit cards.

City of Corning - Internal Controls Over Information Technology and Payroll Processing Cost Savings (Steuben County)
City officials have not developed a formal disaster recovery plan. Although data back-up files are created daily, those files are not adequately secured or tested. Additional deficiencies include the lack of a secure server room, and failure to segregate IT duties or provide for proper supervisor oversight/authorization. Also, by changing to a bi-weekly payroll period, the city would reduce payroll processing costs by approximately $11,000 annually.

Town of Junius, Town of Phelps, Town of Romulus and Town of Tyre - Internal Controls Over Selected Justice Courts’ Financial Activities (Seneca and Ontario Counties)
Court personnel in the town of Phelps managed their court well. However, there were deficiencies in depositing, reconciling, or reporting of court moneys in the other three courts audited. The justice in one court said he performed monthly bank reconciliations, but had no records to support this. Court personnel in the other two courts did not deposit approximately $31,345 in a timely manner, did not perform monthly reconciliations of bank to book balances, and did not maintain accurate bail listings. Justices in the same two courts had not properly segregated incompatible duties or established adequate procedures for reviewing the court clerks’ work. One of these courts also was late in filing the monthly report to the JCF in 22 instances.

Montezuma No. 1 Fire District - Internal Controls Over Financial Operations (Cayuga County)
The board failed to adopt financial policies for investments, procurements, cash management, capital planning, budgeting, and claims processing. The board has not ensured that written procedures concerning financial recording and reporting were developed. The annual budget was not prepared in accordance with town law and the board did not calculate the district’s statutory spending limitation. As a result, the treasurer’s accounting duties were not properly segregated and the treasurer failed to complete and file an annual report as required by law for the past three years. The board was also unaware that the district’s 2010 unreserved, unappropriated fund balance was excessive.

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