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Audit Objective

Determine whether the Town of Shelby (Town) Supervisor (Supervisor) adequately performed his financial duties.

Key Findings

The Supervisor did not adequately perform his financial duties. The Supervisor did not:

• Maintain accurate accounting records. As a result, the accounting records contain significant variances between the bank balance and the recorded cash balance. The variances ranged from more than $1 million as of January 1, 2017 to $153,000 as of December 31, 2020.
• Provide the Board with adequate monthly reports that included cash balances and the detail of revenues received.
• Ensure annual financial reports were filed on time. The 2017, 2018 and 2019 annual financial reports were filed from 106 to 194 days late.

In addition, each year the CPA firm hired to conduct the Town’s annual audit reported financial reporting control deficiencies. However, the Board has not addressed the deficiencies.

Key Recommendations

• Resolve discrepancies in the accounting records.
• The Supervisor should attend and require the bookkeeper to attend training to better understand and perform their job duties.

Town officials agreed with our recommendations and indicated they have initiated or planned to initiate corrective action.