Purpose of Audit

The purpose of our audit was to review the Town’s financial management and controls over information technology (IT) for the period January 1, 2010, through May 30, 2012.

Background

The Town of Pulteney is located in Steuben County and has a population of 1,285. The Town is governed by an elected Town Board (Board), which comprises the Supervisor and four elected Board members. The Town’s 2012 general, highway, and water district appropriations totaled approximately $1.29 million.

Key Findings

During the last two fiscal years the Town’s financial condition has improved primarily because the Town hired a bookkeeper who enhanced the development and monitoring of the annual budgets adopted by the Board.

• The Board has not adopted formal policies, and the Supervisor has not developed detailed procedures, for ensuring that financial duties are adequately segregated or that sufficient review and oversight procedures are in place.
• The Board also did not perform an audit of the water department and did not maintain adequate documentation of its audit of the records and reports of the Supervisor, Town Clerk, or Town Justice.
• The Board has not established policies and procedures related to acceptable use, online banking, breach notification, or disaster recovery.
• There is no system in place for monitoring IT activity or changes in the system, maintaining a computer inventory, or sanitizing computer equipment before disposal.

Key Recommendations

• Adopt written policies and the Supervisor should establish procedures to ensure that financial duties are adequately segregated and/or supervisory oversight controls are in place.
• Conduct an annual audit of the records of the Town Clerk, Supervisor, Town Justice, and Water Department.
• Adopt computer-related policies regarding acceptable use, online banking, information breach notification and disaster recovery.
• Review an adjustment report from the water billing software and a report that describes deletions and changes made in the financial software used by the bookkeeper. Require that an inventory of the Town’s electronic equipment be completed and regularly updated. Establish a policy to ensure that hard drives and other electronic media are properly sanitized before they are disposed of.