Purpose of Audit

The purpose of our audit was to assess the Town’s financial condition for the period January 1, 2015 through August 31, 2016.

Background

The Town of Colchester is located in Delaware County and has a population of approximately 2,100. The Town is governed by an elected five-member Town Board. Budgeted appropriations for the general and highway funds in 2016 totaled approximately $2.8 million.

Key Findings

• The Board does not have a written fund balance policy that addresses reasonable levels of fund balance to be maintained.
• From 2013 through 2015, the Board underestimated revenues by 7 percent and overestimated expenditures by 18 percent, on average, in the general fund.

Key Recommendations

• Adopt a comprehensive fund balance policy that establishes reasonable levels of unassigned, committed and reserved fund balances and how and when committed and reserved funds will be used.
• Adopt reasonable budgets that more accurately reflect historical trends in actual revenues and expenditures.