October 16, 2009
Legislators address findings of audit
Budget and Finance Committee members request solutions from treasurer, auditor
Legislators at Thursday’s Budget and Finance Committee meeting directed County Treasurer Pat O’Mara to report at the Nov. 12 meeting on how he will address deficiencies found in an audit of county finances during 2008.
The audit found funds that did not balance at the end of the year, untimely reconciliation of checking accounts and a lack of procedures established for payment of installment agreements on delinquent taxes.
Legislators also asked that next month County Auditor Dennis Whitt recommend a purchasing policy for the county to implement since the county’s current policy does not require purchases be approved before they are made.
The requests came in response to deficiencies that Certified Public Accountant Richard McNeilly found in the county’s audit during the year ending Dec. 31, 2008.
The Budget and Finance Committee impaneled itself as the Audit Review Committee, which means it is now in charge of reviewing the findings of the audit and recommending remedies.
McNeilly stressed the findings of the audit are not the fault of one single department, but rather county-wide policies that should be reviewed.
For example, McNeilly advised the county to implement a mechanism to ensure that grant spending balance with the amount of the grant received.
“Does anyone look at that after... to make sure you didn’t spend $100,000 to only bring in $50,000?” McNeilly said.
He gave an example of state aid vouchers which could sit for several months and result in paying the county only about half of what was expected. He advised the county to get monthly or quarterly reports from departments that would detail any variation between what has been received and what is expected.
O’Mara said that during 2010 he will require that accounts be reconciled monthly or quarterly instead of at the end of the year.
McNeilly advised the county to establish a policy for installment agreement payments on delinquent taxes that would determine threshold levels, timeframes for payment and set a person responsible for overseeing the payments.
“If there is a policy in place, you follow the policy,” McNeilly said.
He added this is not a Treasurer’s Office deficiency, but rather a county-wide problem and something that should be addressed with the county administrator, county attorney and the treasurer.
O’Mara said next month he will report on the tax payment policy that he uses for property owners, saying it is problematic because he is flexible in certain situations.
“If you don’t abide by the 24 monthly payments, then the county forecloses but there are quite a few people ... who have health problems or a death in the family,” O’Mara said.
He said he works with these people to allow them to pay as their funds allow, saying he would not foreclose on someone who owes the county only $120, for example.
“If there is no contact or someone quits paying, then we foreclose,” O’Mara added. McNeilly advised the county to establish a structured policy that reconciles accounts every month or quarterly. McNeilly said this would prevent accounts from falling behind.
McNeilly pointed to the fact the account in question was only off by approximately $500, saying the problem was not as bad as it has been in past years — but setting a procedure would improve things. Another area that McNeilly would like to see improved is the county’s purchasing policy, where he thinks approvals should be made before money is spent.
But Cortland County Sheriff Lee Price said there are some emergency situations that call for a blanket purchase order to be used, such as when an inmate requires emergency medical attention.
Legislator Jack Williams (D-8th Ward) said it is time for the Legislature to establish a policy.
McNeilly assured legislators he does not think the county is at risk of having its bond rating adversely affected.
“There is not a huge problem. There are no material weaknesses, which are the worst thing you could have,” McNeilly said, when asked by Legislator Gene Waldbauer (R-Cortlandville) about the report’s seriousness.
Budget and Finance Chairman John Troy said he feels better about the report than he did originally but is concerned that some problems have recurred. “I feel there are a lot of issues that are minor issues that can be easily corrected, we just have to do them.”
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