We also issued 10 individual reports to the following Villages: Almond, Cedarhurst, Copenhagen, Great Neck, Holley, Hoosick Falls, Lisle, Mount Kisco, North Syracuse and Pomona
Executive Summary
New York State (NYS) has 532 villages ranging in size from fewer than 50 residents with a budget of $173,450 to almost 60,000 residents with a budget of $93.8 million. Villages provide essential services for their residents, who elect a board to plan, guide and manage operations, including the funding of the annual budget to provide those services. Village officials in NYS should be transparent and accountable, by making financial information readily available to the public. By being open, providing information and keeping public records regarding their financial activities current and accessible, residents are able to see how their tax dollars are being spent, and they are given the opportunity to provide feedback to officials.
Annual Financial Report – Of the 532 villages, 246 (46 percent) filed their statutorily required fiscal year 2023 Annual Financial Report (AFR) with the Office of the State Comptroller (OSC) on time, 210 villages (40 percent) filed the AFR with OSC after the statutory due date and 76 villages (14 percent) did not file.1 While the share of villages filing on time to ensure the public has access to financial information has improved from 30 percent to 46 percent since 2019, the number of villages that do not file their required AFR has grown from six in 2019 to 76 in 2023, a concerning trend.
We reviewed2 the fiscal year 2023 AFR filing status for 30 villages (Villages) across NYS and identified the primary reasons for not filing, as explained by Village officials, which were due to incomplete accounting records, turnover in the Chief Fiscal Officer (CFO) position, and needing training or technical help in filing. Failure to file by the statutory deadline, or not filing the AFR at all, calls into question the financial standing of the Village as well as the general effectiveness of the management of the Village, and leaves residents, policymakers and other interested parties with little to no information regarding the fiscal performance of their government.
CFO Records and Reports – We identified that CFOs in 28 of the 30 Villages we reviewed provided either untimely and incomplete, timely but incomplete, or no financial reports to the Village Board (Board).As such, in only two of the 30 Villages that we reviewed did the CFOs provide timely and complete financial reports. Without timely and complete financial information, a board may not be able to develop realistic budgets, adopt proper property tax levies, monitor operations, or create long-term financial plans. Furthermore, if financial information is not available to the public, taxpayers are less able to assess a village’s fiscal standing and may question whether property tax increases are justified and needed.
Annual Audits – For the 30 selected Villages, there was no evidence of an annual audit being conducted for 28 villages, or 93 percent. A board cannot determine whether the CFO’s accounting records are properly maintained, and reports are complete and accurate without performing the annual audit. The primary reasons for no annual audit, as explained by Village officials, were due to being unaware of the audit requirement, poor accounting records and delays encountered by the Certified Public Accounting (CPA) firms that were engaged to perform the audit. OSC audits of the Villages selected had identified that 21 had failed to maintain complete and up-to-date accounting records.
Village boards should ensure openness by making adequate financial information accessible and by performing annual audits. Ultimately, transparency serves as a cornerstone of good governance, promoting accountability, reducing opportunities for financial mismanagement and ensuring that public funds are used effectively.
1 Data as of September 13, 2024. Since then, 11 villages have filed with OSC as of December 13, 2024.
2 The scope of our review does not constitute an audit under generally accepted government auditing standards (GAGAS).