Purpose of Audit

The purpose of our audit was to review the Village’s purchasing practices for the period June 1, 2011, through April 26, 2013.

Background

The Village of Gowanda is located in Cattaraugus and Erie Counties and has a population of approximately 2,700 residents. The Village is governed by an elected five-member Board of Trustees consisting of the Mayor and four Trustees. The Village’s adopted budget for the 2012-13 fiscal year included appropriations of $1.6 million for the general fund, $695,327 for the sewer fund and $445,993 for the water fund.

Key Finding

• We tested 16 purchases totaling $408,028 made in the 2011-12 and 2012-13 fiscal years. These purchases required bids or quotes, or were purchased from State and County contracts. We found that purchases were not formally bid or awarded by the Board, quotes were not always obtained, and Village officials did not determine if they received the correct State or County contract pricing. The Board’s failure to ensure that Village officials obtained bids and quotes in accordance with the Village’s procurement policy, and verify that they were receiving the correct State and County contract pricing, resulted in the Village incurring higher costs than necessary for goods and services purchased.

Key Recommendations

• Ensure that Village officials comply with the adopted procurement policy and approve contracts awarded through the competitive bidding process, as required.
• Attach the obtained quotes to the vendor’s claim so that the Board can audit and approve these claims for payment.
• Verify that the Village is receiving the appropriate State and County contract pricing.