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Audit Objective

Determine whether Town officials maximized interest earnings and minimized bank fees.

Key Findings

• The Board did not develop and manage a comprehensive investment program to ensure interest earnings were maximized and bank fees were minimized.
• Had the Supervisor invested available funds in a financial institution with higher available interest rates, revenue could have increased by $56,324 during the audit period.
• The Town incurred bank fees totaling $3,327 while receiving $920 in interest earnings during the audit period resulting in a net cost of $2,407 related to banking services.

Key Recommendations

• Periodically request proposals for banking services from multiple financial institutions to maximize the return on investments and minimize bank fees.
• Prepare monthly cash flow forecasts that estimate available funds for investment.
• Ensure available funds are invested in a manner, within legal limits, to maximize interest earnings.

Town officials generally agreed with our recommendations and indicated they planned to initiate corrective action.