New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of the Clarence Public Library, Village of Fort Johnson, Town of Green Island, Village of Lindenhurst, Sayville Public Library and the Village of Springville.
“In today’s fiscal climate, budget transparency and accountability for our local communities is a top priority,” said DiNapoli. “By auditing municipal finances and operations, my office continues to provide taxpayers the assurance that their money is being spent appropriately and effectively.”
The board did not audit and approve claims prior to payment. The library’s bylaws do not address the requirement for an audit of claims and the board did not adopt a written claims audit policy. The director reviews and approves invoices and provides them to the library’s senior clerk, who then prepares checks. Checks require two signatures prior to payment – the director and the board president. However, the board president pre-signs blank checks and does not review the claims for which checks are written.
Village officials have established effective procedures that ensure claims are adequately documented and properly supported, for legitimate village purposes and approved prior to payment. The clerk-treasurer receives vendor invoices from a department head or by mail and prepares claim packets. Each board member reviews each individual claim packet and board resolutions approving payment of claims are then passed and documented in the meeting minutes.
The justices properly collected, recorded and reported court money in a timely manner. Court records were current and accurate and reports to the Justice Court Fund were timely and complete. The justices also ensured that court money was deposited in a timely manner.
While the board, by resolution, generally approved abstracts of claims, it did not perform an effective claims audit or establish an adequate process to ensure that transactions were properly authorized and approved or that claims were for proper village purposes. Although all claims reviewed appeared to be reasonable and legitimate, the use of confirming purchase orders circumvents internal controls and weakens the procurement and budget control process. Moreover, when the board does not audit and approve claims prior to payment and has the same person that audits the claims sign checks, there is an increased risk that the village could pay for goods and services that are not proper village expenditures.
The treasurer’s status, as either a library officer or independent contractor, is unclear. While this appointment and the duties attached to this function are indicative of those of a public officer, it appears this individual was engaged to perform the duties of treasurer as an independent contractor. Among the indications of an independent contractor relationship, the treasurer does not take an oath of office, which is a requirement for holding public office, and is not compensated through the payroll, as are other library officers and employees.
Although the board adopted a procurement policy that required obtaining competition for purchases not subject to bidding requirements, village officials did not always ensure that purchases were made in compliance with the requirements. Furthermore, the policy did not include procedures for procuring professional services. Auditors selected a sample of purchases from 30 vendors totaling approximately $1.7 million and found that village officials did not use competitive methods to procure goods and services from six vendors who were paid a total of $196,732 for professional services. In addition, village officials did not competitively bid purchases from four vendors totaling $148,387, as required.
For access to state and local government spending and 50,000 state contracts, visit OpenBookNY. The easy-to-use website was created by Comptroller DiNapoli to promote openness in government and provide taxpayers with better access to the financial workings of government.