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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Report Highlights

Town of Frankfort - Board Oversight (2018M-58)

Released: June 8, 2018 -- [read complete report - pdf]

Audit Objective

Determine whether the Town Board (Board) provided adequate oversight over financial activity and ensured receipts were deposited and disbursements were supported and authorized.

Key Findings

  • The Board did not establish compensating controls to help oversee the former Supervisor’s work.
  • Our tests of check disbursements totaling $1.4 million disclosed three payments totaling $36,380 that did not contain adequate support. In addition, one employee was overpaid $1,100 and detailed time records were not maintained to support $1,922 in hourly wages paid to another employee.
  • The Board did not properly authorize health insurance benefits averaging $183,000 annually for elected officials in 2016 and 2017.

Key Recommendations

  • Segregate the Supervisor’s financial duties or establish sufficient compensating controls to provide oversight.
  • Ensure that claims are retained and include proper supporting documentation before authorizing payment.
  • Authorize all fringe benefits provided to all officials and employees.

Town officials agreed with our recommendations and indicated they plan to initiate corrective action.

Background

The Town of Frankfort (Town) is located in Herkimer County (County). The Town is governed by an elected five-member Board composed of four council members and a Town Supervisor (Supervisor). The Board is responsible for oversight and general management of financial operations.

Subsequent to our prior audit,1 the former Supervisor resigned in September 2017 and turned his chief fiscal officer duties over to his appointed Deputy Supervisor (Deputy). The Deputy served as chief fiscal officer through December 31, 2017 until the current Supervisor took office on January 1, 2018.

The Town and the Village of Frankfort (Village) formed the Frankfort Consolidated Health District (FCHD), which has been in existence since before 1990. The Supervisor2 served as the FCHD’s Board president and chief fiscal officer.

Quick Facts
Employees48
Population7,600
2017 Budget$4.2 million

Audit Period

January 1, 2016 – August 31, 2017. We extended our audit scope period back to January 1, 2013 to quantify the amount of FCHD cash in the Town’s bank account as of August 31, 2017.

1 Refer to our prior audit report, Town of Frankfort – Supervisor’s Fiscal Responsibilities (2017M-192), issued in 2017.

2 The former Supervisor and other prior supervisors


Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.ny.gov
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236