Both the Superintendent and Assistant Superintendent have a private interest in a company that conducted business with the District. Therefore, we question whether they adequately complied with the District's ethics policy. The responses to financial disclosure forms and subsequent discussions with the Superintendent and the Assistant Superintendent showed that they had an ownership interest in a limited liability company (LLC) that had previously contracted with the District to provide software and technical support for online report cards. In at least one year after the LLC discontinued providing the service, the Superintendent recommended to the Board, and the Board approved, a contract with the LLC's principal owner to provide services similar to what the LLC had previously provided. Specifically, the District paid the LLC $45,342 between February 3, 2006 and April 18, 2008, and paid the principal owner (personally) $28,800 between March 2010 and June 2013 for online report card software and support services. Also, District records showed that the Superintendent signed an agreement for $7,800 for the LLC's principal owner to provide online software support and report card services for the 2013-14 school year. Similarly, the Assistant Superintendent signed an agreement for $5,800 for the LLC's principal owner to provide a similar type of service during the 2011-12 school year. We found no evidence that the District requested proposals or solicited quotes procuring this service.

The Justices failed to establish appropriate internal controls over the Court's financial process. Court moneys were not properly recorded, deposited or reported to the JCF during the audit period. Court's liabilities of $66,297 exceeded the Justices' total available cash of $2,661 as of February 6, 2014 resulting in a cash shortage of $63,636. Because the Clerk controlled all phases of the Court's cash collection processes, she was able to manipulate the records and apparently misappropriate funds. By letting the Clerk have complete control over the collection and reporting process, the Justices failed to provide proper oversight of their financial activity. In addition, neither the Justices nor the Clerk performed monthly accountabilities. We also found no indication that the Board conducted, or retained anyone to conduct, the required annual audit of the Justices' records since July 2011.

The Board failed to establish adequate internal controls or provide oversight of the Department’s financial operations, which resulted in the misuse of funds and unaccounted-for raffle proceeds.

The Board has not provided adequate oversight of Library operations. It has not established appropriate controls over the authorization and payment of overtime. We found that part-time employees worked 830 hours of overtime without necessary management approval. Part-time employees received over $21,000 of overtime payments for overtime work that was not properly approved by management. Furthermore, we found that the Board did not provide prior approval for eight of 12 programs held at the Library in 2013. In addition, the Board did not ensure that all program performers/presenters signed contracts with the Library and submitted the required applications for use of the Library facility as required by Board policy. We also found that the Board spent $8,500 for four Board members and a Board member's relative to travel to an event in Birmingham, Alabama that may not have been for official Library business. The Library also does not have an accurate and complete inventory record that is periodically reconciled. As a result, the Board was unaware that laptops valued at $1,699 each and assigned to two Board members had been stolen; one within days of the Board member receiving it, and the other from the Board member's relative in North Carolina. We also found that the Board did not implement policies or procedures to help properly classify individuals as independent contractors or employees. Finally, the Board did not have adequate controls over the disbursement process and did not audit and approve claims before payment.

The Board needs to improve controls over cash management to adequately safeguard cash collected in three Town departments. The Town does not have effective policies and procedures to ensure that departmental cash is properly protected by the Receiver, the Clerk and Waste Management departments. Additionally, job duties in these departments were not adequately segregated and proper bank reconciliations were not performed. The Board also did not ensure that Town officials followed statutory bidding requirements and the Town's procurement policy. We identified $115,529 in purchases that were not properly bid as required by law and approximately $24,000 in purchases that were made without obtaining quotes as required by Town policy. Further, officials did not develop and follow formal procedures for obtaining professional services and did not have written contracts in place with all professional service providers. In addition, Town officials did not ensure that employees were paid correctly or that leave accrual records were accurate, because controls over payroll and leave time were not properly designed or operating effectively. While the Board adopted policies and procedures over timekeeping, it did not ensure that these policies and procedures were followed. As a result, Town officials spent more than $157,000 on a timekeeping system that was not used effectively. Finally, the Board has not established adequate policies and procedures for maintaining leave accrual records or monitoring leave accruals earned and used.

We found that the Board generally ensured that Company funds were properly deposited and disbursed. The Board-adopted bylaws established adequate controls over Company funds. The Board also hired an independent auditor and appointed a committee; each individually performed an annual audit of the Treasurer's records. However, both audits did not have procedures in place to obtain or review cancelled check images. Therefore, these audits could not effectively ensure disbursements were paid to Company vendors. Additionally, adequate documentation of the President's approval for disbursements was not always kept.

Company officials did not have sufficient controls over cash collected for fund-raising events to ensure that all moneys received were deposited. The Company held fund-raisers through cider sales, ice cream socials and chicken barbeques. The Company officials felt that their current procedures were sufficient to provide adequate oversight for fund-raising events. However, although officials report the net profit to the membership, there is no documentation to verify the amounts that should have been collected.

The Board complied with applicable laws, rules and regulations including the adoption of a code of ethics. The Board adopted bylaws, and established procedures to ensure receipts were deposited and accurately recorded and disbursements were for legitimate Company purposes. The Treasurer maintains complete, accurate and timely records and presents monthly reports of Company financial activities to the Board. Except for minor weaknesses which we discussed with Company officers, we determined that controls are adequate to ensure moneys are safeguarded and financial activity is properly recorded and reported.

The County's internal controls over the timekeeping system were not adequate to ensure employees received only the pay and leave-time benefits to which they were entitled. Although the County Legislature has adopted policies and procedures related to the timekeeping system, we identified weaknesses in those policies. Furthermore, the Legislature has not established procedures to ensure that the Supervisors and department heads comply with the adopted policies. Enforcement of the policies and procedures is handled at the departmental level and has resulted in inconsistencies among the departments in the approval of overtime, modifying time records and the process for charging leave accruals.

We found that the Board has established adequate internal controls over the departmental processing of cash collections. We commend Town officials for designing and implementing an appropriate system of controls over departmental cash receipts.

The former Chief left Town service in September 2011, and the highest ranking sergeant took over the Chief's responsibilities at that time. However, the Town did not hire a replacement until April 2013. During this time, Department employees did not comply with established procedures regarding payroll, creating an environment that allowed errors and irregularities to occur. Specifically, all eighteen officers did not sign the member attendance record, or sign-in sheets, 746 times, and overtime of approximately $19,300 was not properly documented. In addition, an officer working for another entity had time overlaps of about 47 hours totaling $2,153. We also found six instances where a full-time officer scheduled to work did not appear to have worked the hours claimed on his timesheet. This officer received payment, at his higher rate, while a part-time officer who was not on the schedule worked in his place, but did not claim or receive payment for time worked. Additionally, four officers, including a sergeant, were given a total of 11 chart days (paid days off due to scheduling) totaling approximately $3,300 to which they were not entitled. Furthermore, these four officers claimed and received a total of $240 in Officer-In-Charge pay to which they were not entitled. Finally, leave time was not properly managed. Leave time records maintained at the Department did not match those in the Town payroll register.

The District's Point System is not consistent with GML. District officials did not implement standards and procedures to ensure that the records maintained for activities performed under the Point System were accurate and complete. District officials also did not ensure that District employees were not granted LOSAP points for performing activities as volunteer firefighters during their regularly scheduled work hours. Our review of LOSAP records for 23 of the District's 73 LOSAP participants showed that none of these 23 volunteer firefighters received accurate LOSAP points. In addition, three volunteer firefighters, who are also District employees, were incorrectly granted LOSAP points for performing activities during their regularly scheduled work hours.

We identified 15 actions totaling $49,493 which have not been turned over to the State Comptroller as abandoned property even though the funds have been in the custody of the Treasurer for over three years. In addition, New York State County Law requires the County Clerk to maintain a register (Clerk's Register) of all moneys and securities paid, transferred, or deposited, or ordered to be paid, transferred or deposited to a court. Although the County Clerk maintains this record, it is inaccurate. Finally, the Surrogate's Court Clerk has not kept the required Surrogate's Register. As a result, the Surrogate's Court Clerk was unable to readily identify all assets ordered to be paid into a court, and her records could not be used to verify that all court-ordered deposits had been properly received and deposited by the Treasurer.

While District officials generally had effective controls over the use of District fuel cards, they inappropriately paid more than $11,000 in federal, State and local taxes on fuel purchases. District officials were unaware that that they were being charged these taxes on their fuel purchases from both vendors. By paying these taxes on its fuel purchases, the District incurred unnecessary costs.

The Supervisor did not maintain complete, accurate and up-to-date accounting records because he did not properly oversee the bookkeeper's work. As a result, the Supervisor did not provide the Board with the monthly financial information of cash balances for the Town's accounts, bank reconciliations and the required detailed statement of moneys received and disbursed. We also found that certain account balances in the Town's general ledger did not agree with its audited financial statements. The annual audit performed by an independent certified public accountant (CPA) is not reliable because the CPA told us that he did not assess internal controls. In addition, the CPA audits did not ensure that financial records were complete and did not properly account for Justice Court revenue. The Town's poor accounting records have created an environment where the Town's financial condition cannot be effectively assessed or monitored. Finally, the Board and the Supervisor did not ensure that all disbursements were for proper Town purposes. The bookkeeper performs, or has the ability to perform, all aspects of the disbursement process. We identified disbursements totaling almost $6,100 that were not properly reviewed or approved by the Board.

We found that District officials established adequate controls over payroll and leave accruals. District officials implemented specific procedures to ensure that duties were segregated, employees were paid at their approved salaries and wages and received the benefits to which they were entitled, and individuals reported and paid on the payrolls were bona fide District employees.

We found that the Board does not provide adequate oversight of the Company's financial activities. Further, the President did not appoint a finance committee to review and approve Company bills or the Treasurer's records as required by the bylaws. While the Treasurer verbally presented all bills for payment to the Board, the Board did not actually review the bills for payment. Also, the Treasurer did not submit written monthly or annual financial reports to the Board. The Board's lack of internal controls over financial activity creates a risk that Company disbursements may not be for appropriate purposes and that all money due the Company may not be received and deposited.

Internal controls over cash disbursements were not properly designed and operating effectively. Cash disbursement duties were not properly segregated, because the Comptroller maintained the Town's records, had custody of cash (i.e., the ability to disburse funds) and performed bank reconciliations. The Comptroller disbursed cash totaling $596,577 during our audit period. Although these payments were for proper Town purposes, by statute the Supervisor is required to disburse Town money. In addition, the Supervisor disbursed questionable payments totaling $9,340. Finally, the Board did not annually audit the Comptroller's records.

Water customers were not billed in accordance with the Code. Village officials did not collect late fees totaling $3,600 for 155 bills because they allowed an additional grace period after the 30-day payment period and also did not collect one percent late fees after 60 days. Village officials also did not bill two commercial customers because those customers had broken water meters. As a result, one commercial customer received $400 of free water and a second customer received an unknown amount of free water from two meters over the course of two billing cycles.

Our audit identified significant weaknesses in the Department's internal controls which allowed certain records, reports and supporting documentation to be inadequate. The Board did not provide adequate oversight of Department financial activities, and did not perform an annual audit of the Treasurer's books as the bylaws required. While we found no evidence that Department funds were misused, the weak control environment provides ongoing opportunity for potential theft without detection. For example, the Treasurer could not prepare appropriate reports to substantiate the accuracy of revenue received and deposited from the Department's biggest fund-raiser, because receipts from sales were not properly tracked. Furthermore, cash advances and deposits could not be reconciled with ticket sales and proceeds received because there were no suitable records to substantiate them. As a result, $1,365 in cash advances could not be properly accounted for.