Purpose of Audit

The purpose of our audit was to review the City’s financial condition and oversight of its financial operations for the period July 1, 2014 through June 30, 2016.

Background

The City of Yonkers is located in Westchester County and has a population of approximately 200,000. The City, which is governed by an elected seven-member City Council, was given responsibility for managing the Yonkers Public Schools’ (YPS) finances in 2014. Budgeted appropriations for the 2017-18 fiscal year, including those for YPS, total approximately $1.2 billion.

Key Findings

• The City has repeatedly borrowed without first exhausting prior bond proceeds.
• The Council has continued to appropriate fund balance in the City’s budget without using it.
• For the fiscal year ending 2015-16, nonspendable fund balance was overstated by approximately $4 million.
• The City did not perform internal audits or establish a fund balance policy.

Key Recommendations

• Review unused debt proceeds prior to issuing new bonds and limit borrowing to only those amounts actually needed.
• Prepare and review year-end fund balance projections during the budget preparation process.
• Evaluate components of fund balance to ensure they are properly reported and supported.
• Review the Charter and evaluate the need for an internal audit function, and develop and adopt a fund balance policy.