Purpose of Audit

The purpose of our audit was to review the establishment and use of the Town’s reserve funds and to examine internal controls over the Town’s Justice Court’s financial activity for the period January 1, 2013 through May 31, 2014.

Background

The Town of Indian Lake is located in Hamilton County and has a population of approximately 1,350. The Town, which is governed by an elected five-member Town Board, operates a Justice Court with two elected Justices. Budgeted appropriations for 2014 totaled approximately $4.4 million.

Key Findings

• The Board did not properly establish 14 reserve funds and did not make reserve fund expenditures in accordance with State law.
• One Justice did not perform bank reconciliations or month-end accountabilities and another Justice did not perform accountabilities or maintain adequate bail records.

Key Recommendations

• Refund moneys in the non-legally established reserve funds to the operating funds that funded the reserves and ensure that expenditures from legally established funds are properly authorized.
• Perform bank reconciliations and accountability analyses and maintain adequate bail liability records.