Audit Objective 

Determine whether the Village of Herkimer (Village) Clerk- Treasurers maintained complete, accurate and up-to-date financial records and reports.

Key Findings 

The current and former Clerk-Treasurers did not maintain complete, accurate or up-to-date financial records and reports. As a result, the Village Board (Board) lacked the financial information necessary to properly monitor and manage Village finances. The Clerk-Treasurers did not: 

• Properly record financial activity totaling $10.5 million that related to the processing of bank transfers, payroll, real property taxes and cash receipts and disbursements.

• Perform bank reconciliations in an accurate or timely manner, allowing discrepancies between general ledger cash balances and adjusted bank balances to remain unidentified and unresolved.

  As of February 29, 2024, cash balances did not agree with bank balances for 27 of the 37 bank reconciliations we prepared, and total cash in the financial records was $1.9 million higher than the Village’s total adjusted bank balance.

• Provide monthly balance sheet reports to the Board or comply with New York State General Municipal Law Section 30 by filing required Annual Financial Reports (AFRs) with the New York State Office of the State Comptroller (OSC).

Furthermore, the Board did not annually audit the Clerk- Treasurers’ records and reports, as required by New York State Village Law (Village Law) Section 4-408(e).

Key Recommendations 

The audit report includes seven recommendations that will improve the Clerk-Treasurer’s records and reports and the Board’s oversight of financial operations.

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