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Audit Objective

Determine whether the Town of Machias (Town) Town Supervisor (Supervisor) adequately performs his financial duties.

Key Findings

The Supervisor did not adequately perform his financial duties and cannot provide support for almost $1.6 million in interfund loans.

Although interfund loans must be repaid by the close of each fiscal year, interfund loans have grown from $246,280 in 2015 to almost $1.6 million as of December 31, 2019. The Supervisor also did not:

• Provide adequate oversight of the bookkeeper.
• Provide detailed monthly financial reports to the Board.
• Review monthly bank reconciliations.
• Prepare and file the annual financial reports for 2019 and 2020 with the Office of the State Comptroller (OSC) in a timely manner.

Key Recommendations

The Supervisor should:

• Periodically review the work of the bookkeeper to ensure the records and reports are adequately maintained.
• Provide monthly financial reports to the Board, which include a detail of money received and disbursed.
• Ensure appropriate bank reconciliations are completed in a timely manner and review the reconciliations.
• Prepare and file the annual financial report with OSC as required.

Town officials generally agreed with our recommendations and indicated they are taking corrective action. Appendix B includes our comments in response to issues raised in the Town’s response.