Purpose of Audit

The purpose of our audit was to assess the financial oversight provided by the Board of Trustees for the period June 1, 2012 through December 19, 2013.

Background

The Village of Catskill is located in the Town of Catskill in Greene County and has a population of 4,100. The five-member Board of Trustees is the elected legislative body responsible for the general management and control of the Village’s finances and operations. For the fiscal year ending May 31, 2013, the Village reported expenditures of $4.2 million in its general fund, $1.1 million in its water fund and $888,000 in its sewer fund. The Village’s annual budget for the 2013-14 fiscal year is $4.3 million.

Key Findings

• Because the Village did not maintain complete and accurate financial records, the Board did not have reliable information on which to base its decisions.
• The Village filed AFRs for years ended May 31, 2009 through 2012 were filed 10 to 22 months late. When the year-end report is untimely, effective oversight and transparency are reduced.
• The water and sewer funds have substantial unassigned and unappropriated fund balances of $361,360 and $554,138 as of May 31, 2013, without plans for reserves or use of the funds. Such plans would be a useful tool for the Board to address the need to make essential repairs and replacements to water and sewer infrastructure and ensure that no more user fees are assessed than necessary.
• The Board did not develop a comprehensive, multiyear financial and capital plan and it did not have any other mechanism to adequately address the Village’s long-term operational and capital needs.

Key Recommendations

• Maintain complete, accurate and timely accounting records which are properly adjusted to reflect correct account balances.
• Ensure that the required annual financial report is filed with OSC within 60 days after the close of the fiscal year.
• Establish written policies and procedures governing the budgeting process, which include defining reasonable amounts of unexpended surplus funds and reserves that the Village should maintain.
• Develop a comprehensive multiyear financial and capital plan to address long-term operational and capital needs.