Purpose of Audit

The purpose of our audit was to determine whether the Board properly monitored the Village’s financial operations for the period June 1, 2011, to September 30, 2012.

Background

The Village of Herrings is located in the Town of Wilna in Jefferson County, and has a population of 90 residents. The Village Board consists of a Mayor and two trustees, all elected for two-year terms. Budgeted appropriations for the fiscal year ended May 31, 2013 were approximately $130,000 in the general fund and $33,500 in the sewer fund.

Key Findings

• The Board did not provide adequate oversight of the fiscal duties of the Clerk-Treasurer. The former Clerk-Treasurer did not create or maintain cash journals, general ledgers or subsidiary revenue and expenditure ledgers and did not provide a monthly budget-to-actual report.
• The Board has not audited, or caused to be audited, the Treasurer’s records since at least 2007. An effective audit of the Clerk-Treasurer’s records and reports would have identified the serious deficiencies in the accounting records.
• The former Clerk-Treasurer did not complete monthly bank reconciliations.
• The former Clerk-Treasurer paid claims before they were audited and approved by the Board.
• The Board did not take sufficient action to ensure the sale of unneeded Village-owned property to the Mayor for $500 was in the best interest of the taxpayers.

Key Recommendations

• Maintain cash receipt and disbursement journals, general ledgers and subsidiary revenue and expenditure records for all funds. Ensure that the Clerk-Treasurer prepares and submits necessary financial reports, such as budget-to-actual reports, to the Board.
• Ensure that an annual audit of the Clerk-Treasurer’s records is performed by the Board or by a Village officer, employee or a public accountant, as required by Village Law.
• Designate another individual to prepare monthly bank reconciliations.
• Audit all claims prior to payment.
• Take appropriate steps to obtain the best price or the most beneficial terms in the public interest when selling unneeded Village-owned property.