Determine whether the Pompey Hill Fire District (District) Board of Fire Commissioners (Board) properly established and managed capital reserve funds, ensured records were audited and annual reports were filed timely.
The Board did not properly establish and manage the capital reserve fund, establish a written reserve fund policy or adopt a written multiyear capital plan. In addition, annual update documents (AUDs) were not filed timely and the required independent audit of the financial statements was not conducted. We also found:
- Expenditures totaling $427,305 from the capital reserve were not authorized by proper Board resolutions and legal notices were not published for certain purchases subject to permissive referendum.
- The District used $97,000 of capital reserve funds for operating costs which was not an authorized use of the reserve funds.
- Officially establish the capital reserve and written reserve fund policy.
- Ensure reserve expenditures comply with legal requirements.
- Ensure the AUD is filed with our office within 60 days after the close of the fiscal year and annual independent audits are performed.
District officials generally agreed with our recommendations and have initiated or indicated they planned to initiate corrective action. Appendix B includes our comments on issues raised in the District’s response letter.