Purpose of Audit

The purpose of our audit was to examine internal controls over water fees for the period June 1, 2012 through June 14, 2013.

Background

The Village of Rhinebeck is located in Dutchess County. The Board of Trustees comprises four elected members and an elected Mayor. The Village’s budgeted water fund expenditures were $862,000 for the fiscal year ending May 31, 2013.

Key Findings

• The Village’s internal controls over billing, collecting and enforcing water fees need to be improved. The Clerk’s duties were inadequately segregated, unpaid water bills were not accurately re-levied, water bills were not prepared in accordance with the Village’s local law, and the Board did not approve all customer account adjustments the Clerk made in the water accounting system.
• The Board did not annually audit, or cause to be audited, the Treasurer’s records.

Key Recommendations

• Segregate the Clerk’s water billing and collecting duties or implement compensating controls, such as providing routine management oversight activities.
• Establish criteria to determine which water accounts are re-levied.
• Ensure that water bill finance charges are assessed in accordance with its local law, as written, or consider amending its local law to agree with the procedures that are currently in place to assess such charges.
• Approve all of the Clerk’s water account adjustments.
• Annually audit, or cause to be audited, the Treasurer’s financial records.