Purpose of Audit

The purpose of our audit was to examine the Town’s financial activities for the period January 1, 2011 through April 8, 2014.

Background

The Town of Candor is located in Tioga County, has a population of approximately 5,000 residents and includes the Village of Candor within its boundaries. The Town’s 2014 budget of $2.3 million is funded primarily with real property taxes, sales tax and State aid. The Town is governed by an elected Town Board comprising the Town Supervisor and four Board members.

Key Findings

• The Board has not adopted long-term financial and capital/infrastructure plans to set forth the Town’s objectives and goals. From fiscal years 2011 through 2013, fund balance available for use in each of the four major operating funds has either increased significantly or remained at a high percentage of the ensuing year’s budget.
• The Board has not established any policies or procedures to govern the level of fund balance to maintain for each fund.
• Although Town officials told us about their various financial and capital/infrastructure plans for these excess fund balances, the Board has not formally documented any of these plans or set aside funds in reserves for these purposes.

Key Recommendations

• Develop a fund balance policy that establishes reasonable levels of fund balance to be maintained in each fund in order to meet the Town’s needs.
• Adopt comprehensive multi-year financial and capital plans, including when to use accumulated fund balances in a manner that will benefit taxpayers.
• Formally establish authorized reserves to finance certain anticipated future expenditures and adopt a policy to establish funding and use of the reserves.