Although the District purchased fixed assets totaling $145,398 during our audit period, the District does not have a comprehensive policy or procedures to safeguard fixed assets. In addition, the District's inventory list did not contain identifiable information for each asset including purchase date, purchase price, date placed in service and useful life. As a result, officials were not aware that equipment in their possession could have been sold or traded in to help offset the cost of new equipment purchases totaling $124,880. Finally, 20 pieces of equipment purchased during the audit period totaling over $44,000 were not listed on the District's inventory list.

District officials did not properly account for Niagara Power Coalition revenues. We found that $4.2 million was maintained in the debt service fund although the funds had not been designated to pay debt. Because these funds have not been assigned to pay debt, Coalition revenues should be accounted for in a special revenue fund until revenues are allocated for debt payments. District officials improperly restricted funds totaling $507,000 in a debt reserve. Finally, District officials maintained a capital reserve funded at $506,000 that was not properly approved.

We compared budgeted appropriations and estimated revenues with actual operating results for 2016-17 through 2018-19 and found that, while revenue variances were generally reasonable (overestimated by an annual average less than 3 percent), appropriations were overestimated by an average of $913,000 (6 percent) each year or a total of $2.7 million. However, budget estimates appear to be improving and becoming more in line with actual expenditures. Because the Board overestimated appropriations, it appeared the District needed to appropriate fund balance to close projected budget gaps. The Board annually appropriated at least $225,000 of fund balance in the 2016-17 through 2018-19 budgets that was not needed to finance operations. As of June 30, 2019, surplus fund balance totaled over $1 million and was 6 percent of 2019-20 appropriations, exceeding the statutory limit by approximately $354,000 or 2 percentage points. Finally, the District's written reserve fund policy was not comprehensive and three reserves with balances totaling $1.3 million were generally not being used.

District officials did not seek competition for seven professional service providers who were paid $325,131 during our audit period. The Superintendent told us that he was unaware that District policy required RFPs or written documentation of verbal quotes for professional services, except for audit services. In addition, officials did not obtain written or verbal quotes for the purchase of goods and services from five vendors paid $267,306. Finally, the Board did not review and update the District procurement policy.

District officials did not provide IT security awareness training for individuals who used the District's IT assets. In addition, personal Internet use was found on computers assigned to employees who routinely accessed PPSI. District officials were unaware of this activity because they did not routinely monitor employee Internet use. The Director told us that because he was the only IT contact on staff, he was unable to spend time monitoring employee Internet use. Finally, network and application user accounts were not properly managed.

The Board overestimated appropriations by a total of $3.1 million from 2016-17 through 2018-19 and annually appropriated an average of $500,000 of fund balance that was not used to finance operations. In addition, the District improperly restricted more than $260,000 in its trust and agency fund. As of June 30, 2019, surplus fund balance totaled $708,000 and was 4.5 percent of 2019-20 appropriations, exceeding the statutory limit by approximately $75,000. However, when we added the unused appropriated fund balance amounts and the funds improperly restricted for other post-employment benefits (OPEB) back to surplus fund balance, the District exceeded the limit each year by nearly 5 to 7 percentage points in amounts ranging from $681,000 to $1,036,000.

The Board did not ensure Company claims were audited on a monthly basis as required by its bylaws. In addition, the Board President and two Board members did not publicly disclose, in writing, their deemed interests in contracts totaling $91,106 with the Company. Furthermore, the Treasurer did not file Form 990 with the IRS during our audit period because the Board was unaware of this reporting requirement. Additionally, the Company has not filed 1099-MISC forms to report payments made to the three Board members who provided services as independent contractors related to the new firehouse construction in 2016, 2017 and 2018. Finally, Company officials did not ensure collections totaling $40,084 from fundraising activities were adequately supported.

The Board needs to improve its budgeting and monitoring of the Town's financial operations and take timely action to improve the Town's declining financial condition. The Town's main operating funds are the general town-wide (TW), general part-town (PT), highway TW and highway PT funds. The total fund balance for these four funds combined has declined $144,719 from a deficit of $57,560 at the end of 2014 to a deficit of $202,369 at the end of 2018. The Board also has not adopted multiyear financial and capital plans. Finally, a Board member, who is the sole owner of an insurance brokerage firm had a prohibited interest in Town contracts totaling approximately $782,100. The Town purchased various insurance policies, such as group health, dental, prescription, life and supplementary insurance, for Town employees and officers through the Board member's brokerage firm.

We identified instances where the Board and District officials could have been more transparent when presenting the project's scope to the public. While project total costs of $16.49 million did not exceed the $16.5 million in propositions approved by voters, officials had an opportunity to complete the proposed project for less than the approved amount. However, officials chose to complete additional work and expand the project's scope rather than spending less. Further, officials did not provide the voters with sufficient detail to enable them to be fully informed regarding the project scope. In addition, we found seven change orders totaling approximately $362,000 that exceeded the statutory bidding threshold of $35,000 for public works contracts that were not competitively bid.

Central treasurers failed to ensure that student treasurers and faculty advisors were informed of the requirement to maintain accounting records for their clubs. In addition, the District's external auditors indicated that student activity records were not adequate to permit the application of auditing procedures in the last four audits (2014-15 through 2017-18). However, District officials still failed to effectively communicate the procedures that outlined the student treasurers' and advisors' recordkeeping responsibilities. As a result, student treasurers and advisors failed to maintain pre-numbered tickets and receipts, statement of profit and loss forms, and annual record of funds received and paid out. In addition, checks were not countersigned and payments were not properly approved. Furthermore, middle school bank reconciliations were performed incorrectly, resulting in inaccurate cash balances being reported to clubs and to the Board.

The Board and Village officials did not ensure disbursements were for proper purposes and supported. We found the former Clerk-Treasurer issued herself five checks totaling $5,100 that she was not entitled to. In addition, employees received payment for medical reimbursements totaling nearly $5,700 that lacked adequate supporting documentation. Four employees, including the former Clerk-Treasurer, submitted duplicate claims for reimbursement totaling over $900 for claims previously paid. Subsequent to our audit, the former Clerk-Treasurer pleaded guilty to petit larceny, a misdemeanor, and agreed to pay full restitution plus $500 to cover the Village's insurance deductible with a one year conditional discharge.

The Supervisor did not maintain complete and accurate accounting records and reports, issue receipts or submit an annual accounting to the Board for its subsequent audit of the Supervisor's records. Instead, the Supervisor indicated that she relies on the certified public accounting firm (Firm) to handle the day-to-day accounting activities and she provides minimal oversight of the Firm because she does not have an accounting background and had not attended any training related to her duties as Supervisor. As of the beginning of the agreement with the Firm in 2018, the Town's computerized financial records, which include budgetary, revenue, expenditure and payroll records, are maintained by the Firm and housed within the Firm's financial software system. The Supervisor does not have access to this software. The Supervisor instead maintains a binder which holds her documents by month, including payroll records as prepared by the Firm and support for revenues she receives, such as check images and stubs. In addition, the Supervisor was not aware of the statutory 10-day requirement for deposits and does not issue receipts, but instead generally takes pictures on her phone of money she receives at the Town, which is typically in check payments, and emails these images to the Firm. She subsequently makes deposits about twice a month.

We evaluated the financial condition of the Town's four operating funds' for the 2016 through 2018 fiscal years. We found the town-wide (TW) general fund and the TW highway fund had deficit unrestricted fund balances whereas the part-town (PT) general fund and the PT highway fund had excessive unrestricted fund balances. The Board also did not develop and adopt comprehensive written multiyear financial and capital plans and a written fund balance and reserve fund policies to help guide the budget development process. Finally, outstanding interfund cash advances from 2016 have not been repaid as required.

The Board did not audit claims before approving payments. Of 166 claim vouchers reviewed, totaling $783,400, the Supervisor paid $124,000 in claims (16 percent) that were either not presented to the Board or improperly paid prior to Board approval. We also found that 11 claims totaling $10,500 lacked adequate supporting documentation and seven claims for $4,100 were paid twice. Finally, the Board did not ensure that procurements of commodities, goods and services totaling $172,000 complied with bidding requirements and/or the Town's procurement policy.

Village officials do not periodically read all customer meters to ensure customers are accurately billed. In addition, the Clerk-Treasurer used an inconsistent methodology for estimating water bills. We also found that estimated and customer-submitted water usages used by Village officials to bill customers did not always appear to be accurate. Finally, 85 percent of the water produced, or 74.9 million gallons, is considered non-revenue (lost) water.

Our Office recently completed a review of the District's general fund budgets because the preliminary results of its annual external audit revealed an unplanned deficit had occurred during the 2018-19 fiscal year. Due to several inaccurate estimates, the District is on track to incur a 2019-20 budgetary deficit of approximately $31.6 million, even accounting for the numerous cost-savings and avoidance measures, including personnel layoffs, recently implemented by the Superintendent and Board of Education (Board). In addition, the District has no available unrestricted fund balance to mitigate this budgetary deficit. The District reported a deficit unrestricted general fund balance of $8.9 million at June 30, 2019. Therefore, if current District operating trends continue, we project the District will have a fiscal year-end deficit of approximately $40.5 million. Further, absent additional severe budget cuts, short-term borrowings or outside intervention, the District will not have sufficient resources to meet its financial obligations by the end of the fiscal year ending June 30, 2020.

The account clerk (clerk) received $6,000 in inappropriate health insurance buyout payments for 2017 and 2018 while the Town paid for her health insurance coverage totaling $30,876 from April 2017 through July 31, 2018. In addition, the clerk did not withhold the required health insurance premium contributions from her pay, totaling $2,875 and received an unauthorized retroactive buyout payment of $2,000 for 2016.These matters were referred to the Onondaga County District Attorney's Office. In April of 2019, the clerk was arrested for grand larceny in the third degree, falsifying business records in the first degree and official misconduct. The case is currently pending in court. Furthermore, the Supervisor did not regularly review and approve the clerk's time records, therefore she received overtime pay totaling $13,129 that was not approved in advance. Finally, the Board did not audit and approve claims.

The Board adopted general fund budgets that significantly underestimated revenues and overestimated appropriations over the last three fiscal years. Because the Board did not adjust ensuing years budgets based on prior year's results a pattern of over budgeting developed. This resulted in unplanned operating surpluses totaling nearly $1.5 million, instead of the budgeted deficits. Although the operating surpluses decreased over the last three fiscal years, the recalculated unassigned fund balance continued to increase. Over the past three completed fiscal years, the District reported unassigned fund balance that ranged from 16.5 percent to 27.8 percent of the ensuing year's appropriations, which is four to seven times the limit allowed by Real Property Tax Law. Moreover, when unused appropriated fund balance is added back, unassigned fund balance exceeds the statutory limit by an even greater margin. The Board and District officials are currently discussing and preparing a new strategic plan for 2020-2025 that will address, among other things, financial condition and capital projects.

The Justice's cash balances exceeded known liabilities by a total of $6,444 as of June 30, 2019. There were seven old cases recorded in the accounting system dating back to the 1990s, with outstanding held bail and restitution totaling $1,864. In addition, the Board's audit of the Court records and reports was inadequate. Finally, because the Court does not review the annual pending ticket list, errors and inconsistencies in ticket recording and reporting occurred between the Court's and DMV records and were not addressed, potentially resulting in the loss of fine revenue.

The Board of Supervisors (Board) and the Board of Health (BOH) did not audit their respective claims before payment. Our review of 382 claims totaling $3.5 million disclosed that 121 claims totaling $752,749 lacked adequate support or documentation showing receipt of goods or services. In addition, claims totaling $1.3 million were paid without Board approval. Finally, the Treasurer did not control the check signing process for computer generated checks and allowed a credit card vendor to directly withdraw $1.9 million in monthly payments from a County bank account.