The Board did not ensure that financial reports it received were timely, accurate, and contained the necessary information it needed to properly monitor the District's financial condition and fund balance. If the Board does not adequately control expenditures and monitor and rebuild the District's fund balance, there is a risk that the District may not have sufficient financial resources available to address unexpected occurrences or meet its cash flow needs.

The Board did not provide adequate oversight of the District's financial operations. As a result, the Board hindered their ability to make informed financial decisions and levied taxes that were more than necessary to fund operations.

Pursuant to a court order, certain assets may be provided to the court and then delivered to the County Commissioner of Finance (Commissioner) for safekeeping. Payments made pursuant to court orders commonly involve surplus money from foreclosures and contract disputes resulting in a mechanic's lien. These actions are recorded in the County Clerk's office when payments are deposited as required by court order. Additionally, in certain circumstances, funds from estates are entrusted to the Commissioner for safekeeping by order of the Surrogate's Court. Together, the Commissioner, County Clerk and Surrogate's Court must develop sound procedures and processes which, when implemented properly and consistently, provide a system of internal controls to account for and safeguard these funds.

BOCES officials did not develop and manage a comprehensive investment program. During the 12-month audit period, BOCES held $7.4 million in money market accounts and earned interest totaling $105,000, and held $4.6 million in non-interest bearing accounts. Had officials considered other available investment options, BOCES may have earned $448,000 in investment income, or $343,000 more than the $105,000 earned during our audit period.

District officials did not properly claim State aid for special education students who received services in 10-month public and summer placements. As a result, as of April 30, 2023, the District will not benefit from $28,832 in State aid that was not claimed and had not claimed an additional $224,976 in aid, of which $195,844 would have already been received if claimed in a timely manner. Officials also claimed and received $57,650 in aid to which the District was not entitled.

The North Chautauqua County Water District's (District's) Board (Board), County Legislature (Legislature) and other County officials did not adopt realistic budgets, routinely monitor the District's financial operations or take appropriate actions to maintain the District's fiscal stability. As such, all County taxpayers have been funding District operations instead of just the real property owners who benefited from the District's services.

The Town was not reimbursed equitably for shared service costs related to the intermunicipal agreement (IMA) and the operating group Chadwick Bay Intermunicipal Water Works (CBI). In addition, the Board did not convey land to Chautauqua County (County) in a transparent and equitable manner.

District officials did not develop and manage a comprehensive investment program. During the 22-month audit period, the District had an average of $12.4 million in operating and debt service funds available for investing, and earned $154,099 in investment earnings. Had officials utilized their investment accounts more effectively, the District may have earned $356,452, or $202,353 more than the $154,099 of investment earnings during our audit period.

Claims and payroll-related disbursements were not always adequately supported, properly approved or for Town purposes.

District officials did not properly bill and collect tuition for nonresident foster care students enrolled at the District. As of March 27, 2023, the District had not collected $59,336 of tuition billed and did not bill $4,345 for tuition due. As a result, the District had not been paid $63,681 of the $107,167 (59 percent) in tuition owed to the District during the 2019-20 through 2021-22 school years.

The Board did not provide adequate oversight over financial operations and capital projects. As a result, the Board did not have sufficient information to oversee financial operations and capital projects. The Board was unaware of the Village's financial position and that financial records were disorderly and incomplete.

BOCES' capital asset records were not complete or accurate to ensure that assets were accounted for and protected from loss, theft, misuse and obsolescence. We selected 94 capital assets purchased for $247,918 and identified one or more exceptions for 49 capital assets purchased for $115,351 (two capital assets, with a purchase price of $4,437, had more than one exception).

Officials did not provide adequate oversight of water fund operations.

District officials generally paid the 33 employees we tested accurately and properly calculated their leave accruals.

Pursuant to a court order, certain assets may be provided to the court and then delivered to the County Treasurer (Treasurer) for safekeeping. Payments made pursuant to court orders commonly involve surplus money from foreclosures and contract disputes resulting in a mechanic's lien. These actions are recorded in the County Clerk's office when payments are deposited as required by court order. Additionally, in certain circumstances, funds from estates are entrusted to the Treasurer for safekeeping by order of the Surrogate's Court. Together, the Treasurer, County Clerk and Surrogate's Court must develop sound procedures and processes which, when implemented properly and consistently, provide a system of internal controls to account for and safeguard these funds.

The Board did not properly audit claims before payment. As a result, there was an increased risk that improper or unsupported payments could have been made and may not have been detected and corrected.

BOCES' capital asset records were incomplete and inaccurate.

The Town Board (Board) and Town officials did not ensure that credit card purchases were supported and for proper Town purposes. The former Director of Finance (former Director) was arrested in September 2022 for charges relating to her use of the Town's credit card. She pleaded guilty to disorderly conduct in December 2022. Additionally, the Board and Town officials did not ensure Finance Office payroll was accurate and supported.

The Board did not always properly audit claims before approving them for payment. Due to insufficient documentation, we were unable to determine and the Board was unable to support they approved claims before payment. We reviewed 71 claims (out of 353 claims) totaling approximately $55,100 and determined that Town officials did not comply with the Town's procurement policy.

The Town Board (Board) did not consistently seek competition for purchases or avoid conflicts of interest. As a result, goods and services may not have been procured in a cost-effective manner.