The Board did not properly monitor and manage the Village's financial condition. As a result, fund balance for all three major funds (general, water and sewer) decreased significantly from 2008-09 to 2011-12 due to operating deficits caused primarily by poor budgeting which resulted in revenue shortfalls and overspent appropriations. For example, the fund balance of the general fund dropped from $927,214 in fiscal year 2008-09 to a deficit of $39,827 at the end of the 2010-11 fiscal year before showing some improvement in the 2011-12 fiscal year. The Board also relied on fund balance and interfund loans to fund recurring operating expenditures. The Board also did not adequately monitor the budget and allowed appropriations to be overexpended for many line items and in total for the general fund budget. General fund appropriations were overexpended by $143,908 in 2011-12, $197,420 in 2010-11 and $313,832 in 2008-09. Although the 2009-10 budget was not overspent in total, several individual line items were overspent. The lack of monitoring also caused expenditures to consistently exceed appropriations in the water and sewer funds. Finally, the Board has not developed comprehensive, multiyear financial and capital plans to improve the budget development process.

The Department recorded collections of $74,685 in DWI fees, $39,797 in administrative fees, $21,312 in ignition interlock fees and $17,672 in restitution and surcharges during the audit period. We found that the Department has instituted proper controls and is collecting revenues due the Department.

We found that the Board and membership generally do not provide adequate oversight of Company financial activities. The Board has not adopted any written policies and procedures for financial operations. The Board has not set standards of conduct for the guidance of the officers and members with respect to disclosure of interests. The Company's financial duties are not adequately segregated and there are no sufficient compensating controls. The Treasurer provides a monthly report at the membership meeting detailing receipts, disbursements, cash balances and the list of bills to be approved that month. Although the written report is available, no one reviews it; instead, the Treasurer reads it aloud. The individual claims are not audited for accuracy or examined for supporting documentation. The President did not provide the legally required written disclosure of his ownership interest in a business used for the Company's website hosting. The Board did not conduct an annual audit of the Treasurer's books at any time. Finally, the Treasurer has not filed the annual foreign fire insurance report for 2012, as required, and does not maintain separate records of expenditures from these moneys.

We found that the records maintained by the Surrogate's Court were generally up-to-date and complete, and we noted no material discrepancies. However, we found that the County Clerk (Clerk) is not maintaining appropriate court and trust fund records. Although the Clerk maintains scanned copies of all court orders filed in his office, he does not make an entry into the court and trust fund register of the moneys ordered to be paid into court. As a result, the Clerk was unable to readily identify assets ordered to be paid into court, and his records could not be used to verify that all court-ordered deposits had been properly received and deposited by the Treasurer. We also found that the Treasurer established adequate procedures, maintained appropriate records and properly reported the condition of court and trust funds to the State Comptroller as prescribed by statute. However, we identified funds which improperly remained in the Treasurer's custody and should have been turned over to the State Comptroller as abandoned property. Finally, we found that the Treasurer had retained a fee in excess of the amount allowed by law when disbursing court funds.

The Board did not effectively manage the Village's financial condition. The Board did not develop sound revenue budget estimates; it also failed to increase water and sewer rates, which drive the revenues in these funds. As a result, water and sewer revenues were overestimated by an average of 25 percent and 21 percent, respectively, which caused fund balance to decrease significantly in both funds from fiscal years 2009-10 through 2011-12. Unplanned operating deficits caused both the water and sewer funds to have a deficit fund balance. Over a four-year period, the deficit fund balance in the water fund grew by a total of $61,274, or 51 percent, while the sewer fund balance declined by a total of $42,974, or 132 percent. Although both funds had an operating surplus in the 2012-13 fiscal year, the funds still ended the year with deficit fund balances of $181,522 in the water fund and $10,424 in the sewer fund. The Village's general fund loaned moneys to these funds to offset the funds' deficit balances. Furthermore, the poor financial condition of the water and sewer funds has negatively impacted the cash flow of the Village's general fund.

Based on the results of our review, we found that the significant revenue and expenditure projections in the tentative budget are reasonable. The District's proposed budget complies with the property tax levy limit.

Based on the results of our review, we found that the significant revenue and expenditure projections in the tentative budget are reasonable. The Village's proposed budget includes a tax levy which exceeds the allowable property tax levy limit. Therefore, to comply with the Law, the Board must adopt a local law overriding the tax levy limit before they adopt the proposed budget.

The unexpended surplus funds in the Village's general fund increased nearly $200,000 (45 percent) over the past five years to almost $640,000 as of May 31, 2013. As a result, the general fund's unexpended surplus funds in 2012-13 reached 182 percent of next year's appropriations. Unexpended surplus funds increased from 2008-09 through 2012-13 despite the Board adopting budgets that indicated that the Board planned to use some of the fund balance to partially fund operations. Village budgets included planned operating deficits in each of these years. However, from 2008-09 through 2012-13 Village operations generated a combined operating surplus totaling more than $187,000, eliminating any need for using appropriated fund balance except in 2011-12.

We found that the Clerk did not number claims or prepare abstracts of claims to be approved by the Board for payment by the Supervisor. Only the total amount of claims approved by the Board for payment was included in the Board minutes. We found that the amounts in the minutes did not agree with the total amounts of the approved claims for two of the four months we reviewed. For example, the February 2012 Board minutes indicated that the amount of claims approved for payment was $9,630 more than the claims filed with the Clerk. Conversely, the February 2013 Board minutes indicated that the amount of claims approved for payment was $1,128 less than the claims filed with the Clerk. The Clerk stated that she may have calculated the totals incorrectly before entering the amounts in the minutes.

The Board needs to improve its oversight and management of the District's budget. Over the last four fiscal years, the District's conservative budgeting practices resulted in operating surpluses that totaled approximately $164,000. To reduce fund balance, the Board appropriated unexpended surplus funds each year, for a four-year total of nearly $1.3 million, to help finance the ensuing year's operations. However, because of the District's surpluses, approximately $1 million of the fund balance appropriations over the four years went unused. As a result, the District accumulated unexpended surplus funds equivalent to 11 percent of the ensuing years' budgets, or nearly three times the amount allowed by law. Further, we found that the amount retained in the District's retirement contribution reserve is excessive and the District made retirement payments out of the general fund rather than the reserve fund. The Board also improperly appointed its President, in place of the Treasurer, as the sole signatory on District checks under $5,000, with its Vice President as co-signor for all District checks over $5,000. This Board action allowed one of its members to, in effect, also act as Treasurer for the purpose of disbursing District funds, which is prohibited by Education Law. Finally, the Board has not developed and adopted policies, including a disaster recovery plan and a breach notification policy, to ensure the District's electronic data is adequately safeguarded.

We found that the Board and District officials did not adopt and implement appropriate policies and procedures for the extra-classroom activity fund. As a result, the Board did not receive monthly extra-classroom activity fund records during the audit period. In October 2013, subsequent to the start of our fieldwork, the central treasurer started providing the Board with extra-classroom activity fund records. In addition, the student treasurers lacked sufficient documentation/accounting records for collections totaling $23,676, such as profit and loss statements, up-to-date activity ledgers or inventory control forms. The central treasurer did not provide the student treasurers with duplicate receipts for remittances from the various clubs totaling $23,676. Further, of these funds, there was insufficient documentation supporting $22,491 collected by the student treasurers to determine if the cash and checks collected were remitted timely to the central treasurer.

The Library retained excessive fund balance in each of the fiscal years 2006-07 through 2011-12 by as much as $2,435,455, which was 71 percent of the ensuing year's appropriations. For the fiscal years ended June 30, 2008 through June 30, 2012, Library officials increased unexpended surplus fund balance from $323,014 to $1,123,014, yet did not expend any of these funds during that period. Library officials have not communicated these surplus funds to taxpayers. Library officials have also maintained a capital projects fund despite having no current capital projects in place and no planned capital projects in the near future. In addition, using moneys from this fund, they purchased items that appear to be day-to-day expenditures that should have been paid from the general fund. Finally, Board members did not receive or request adequate financial information from the Director; as a result, the Board is not adequately informed of the Library's fiscal affairs.

The Board and College officials did not provide adequate oversight of the College's financial operations to ensure that College assets were adequately safeguarded. The Bursar's Office did not grant tuition waivers in accordance with the provisions of the College's collective bargaining agreements. Of the 97 waivers granted during the 2012-13 fiscal year, the Bursar's Office granted 43 waivers (approximately 45 percent) totaling $54,364 to individuals that were not eligible, resulting in lost revenue to the College in the same amount. We also found that some students were overbilled and/or underbilled for services received; adjustments were made to student accounts without approval; student refund checks were printed and disbursed without approval; and the timing of methods used to enforce delinquent student accounts were not consistent from one semester to the next. In addition, College officials have not properly limited users' access within the student management system and the system allowed for the ability to delete receipts and then issue the same receipt number a second time for a different transaction. Finally, we found that College officials did not solicit quotes for 15 purchases totaling $99,584 and the College paid $376,415 to eight professional service providers without soliciting competition. In addition, neither the Board nor any College official performed a proper audit of claims, resulting in the College paying credit card charges totaling $11,798 without sufficient documentation of the purchases that were made and $223,873 in payments being made to three professional service providers without written contracts.

The Board and Town officials were aware of revenue shortfalls in the water district fund, but did not take appropriate action to align estimated revenues in the adopted budgets with actual rate schedules. This resulted in an accumulated operating deficit totaling more than $14,000 from fiscal years 2011 through 2013 and, ultimately, a $4,000 deficit fund balance estimated as of December 31, 2013. Furthermore, the water district fund owed the general fund a cumulative balance of $66,388 as of December 31, 2013. The Board continued its inaccurate budgeting practices with the 2014 budget, which makes it unlikely that the water district fund will be able to begin to repay the general fund or improve its financial condition. We also identified weaknesses in the Justice Court's internal controls over financial operations. There was no documentation indicating that monthly bank reconciliations or accountabilities had been performed, and neither Justice reconciled their bail accounts. Furthermore, computerized records for bail were not accurate for Justice Mackey as well as three former Justices. Also, the former Justices' open case files within the computer system had not been properly transferred to the current Justices. Finally, the Board did not perform an annual audit of the Justices' books and records.

District officials did not verify that all non-original equipment manufacturer (OEM) school bus options were consistent with State contract pricing for the 16 school buses they purchased in 2012-13 and 2013-14. District officials did not obtain the State contract list price books, apply the appropriate contract discounts or compare the resultant prices with the invoice prices. As a result, they overpaid by $12,080 for two non-OEM options (rust proofing and heaters) installed on 12 of the buses. In addition, the Board did not properly plan for the use of reserve funds. As of June 30, 2013, the District had seven reserve funds with balances totaling $5 million. We analyzed these reserves for reasonableness and adherence to statutory requirements, and found the balances of five of the reserves appeared to be reasonable. However, the balances of two reserves (the unemployment insurance and tax reduction reserves) with balances totaling approximately $2.2 million appeared higher than necessary to fund costs that may be legally paid from these reserves.

The Board did not develop policies and procedures for budget preparation and monitoring and, as a result, repeatedly adopted budgets with inaccurate estimates for revenues, expenditures and appropriated fund balance. In the town-wide (TW) general fund, the overestimation of expenditures and underestimation of revenues created a positive budget variance of nearly $568,000 over five years. At the 2012 fiscal year end, the unrestricted fund balance amounted to 48 percent of the Town's general-fund expenditures for that year. Similarly, the 2012 year-end unrestricted fund balance in the town-outside-village (TOV) general fund amounted to 68 percent of the year's expenditures; and in the TOV highway fund, to 34 percent. These excess funds are considerably more than reasonably necessary for a financial cushion. Additionally, the Board did not appropriately allocate the Deputy Highway Superintendent's compensation, placing an inequitable burden on TW taxpayers. We also found that the Board did not establish sufficient controls over payroll records and leave time. Employees did not keep daily time records of regular and overtime hours worked or leave time used, and did not formally request leave time usage. Thus, payroll reports did not include leave time usage and inaccurately reported all paid hours as hours worked. In addition, the Highway Superintendent's sick leave accumulation surpassed the maximum by 64 days with leave time credited for 2013.

The Board did not adopt reasonable budgets and adequately manage the District's financial condition. The Board continually overestimated appropriations for the last three years causing the District to exceed the 4 percent statutory limit each year with the District's unassigned fund balance reaching $1,334,486 as of June 30, 2015, or 10.7 percent of the ensuing year's appropriations. Although the Board appropriated fund balance each year, the adopted budgets actually produced operating surpluses. As a result, none of the appropriated fund balance was used. When the unused appropriated fund balance was added back, the recalculated unassigned fund balance reached $2,034,486 or 16.4 percent of the ensuing year's appropriations. In addition, the District maintained a total of $565,000 in three reserve funds but had no plan for their use. The tax certiorari reserve is overfunded by as much as $145,000 (96 percent). Lastly, officials did not adopt a multiyear financial or capital plan.

The Board has not established policies and procedures to ensure adequate internal controls over the cash receipt process for taxes. Library personnel do not maintain a record of taxes received by fiscal year and they have no process in place to ensure the Library received the full amount of real property taxes levied for the Library each year. We determined that for the last four completed fiscal years the amounts transmitted to the Library by the District were $3,500 in 2010-11, $880 in 2011-12 and $46,500 (or 4.26 percent) in 2012-13 less than the voter approved tax levies. We discovered that the District has been reducing the amount of money paid to the Library when there are refunds in property assessments due to tax certiorari judgments. However, there is no authority for a school district to charge back any portion of a tax certiorari refund to a school district public library. The Board has also not established adequate internal controls for over-the-counter receipts. The Library does not have procedures in place to record all receipts at the time of collection and there are no procedures to ensure individual accountability.

The District's controls over extra-classroom activity funds were not operating effectively. The Board did not ensure that District officials implemented and enforced its policy governing the operations of the activity funds. Consequently, we found that 30 cash receipts totaling $19,322 had no supporting documentation and four student treasurers did not maintain ledgers during the 2012-13 fiscal year. The District's failure to maintain activity funds in accordance with the Board's policy increases the chance that extra-classroom activity moneys could be lost or misused. These deficiencies continued to exist even though our previous audit identified similar internal control weaknesses over the District's extra-classroom activity funds.

The Board did not implement adequate controls over the Department's financial activities, develop adequate policies and procedures, or adopt a code of ethics. The by-laws do not include any detailed financial procedures that would adequately segregate the duties of day-to-day financial operations. As a result, the Treasurer and Lottery Account Clerk perform all their financial duties with little oversight. We also found that as of November 2013 the Treasurer had not recorded the monthly lottery transactions since February 2013. Further, although all Department checks require two signatures, there is no evidence that the Board was consistently auditing the prior month's receipts, disbursements, account balances, bank statements and other records as required by the by-laws. There was also no evidence that the Board consistently reported the results of the audits in June and December to the Department members.