YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

September 27, 2002

Report No. 2002-100

IMPORTANT:� The Missouri State Auditor is required by Missouri law to conduct audits only once every four years in counties, like Andrew, which do not have a county auditor.� However, to assist such counties in meeting federal audit requirements, the State Auditor will also provide a financial and compliance audit of various county operating funds every two years.� This voluntary service to Missouri counties can only be provided when state auditing resources are available and it does not interfere with the State Auditor's constitutional responsibility of auditing state government.

Once every four years, the State Auditor's statutory audit will cover additional areas of county operations, as well as the elected county officials, as required by Missouri's Constitution.

This audit of Andrew County included additional areas of county operations, as well as the elected county officials.� The following concerns were noted as part of the audit:

• The County Treasurer did not follow up on large unreconciled differences for funds in the general checking account. �Adequate reconciliations between the County Treasurer's records and those of the County Clerk were not performed resulting in errors in the Treasurer's semi-annual settlements and the county budget.� Commissions earned on tax collections were not distributed properly. County money held by the County Treasurer and County Collector is invested in low interest-bearing checking accounts, and the Capital Improvements Sales Tax Fund is not included in the interest allocation process.
  
  
• The county does not maintain accurate and complete asset records for the Cemetery Trust Fund and proposals were not solicited when selecting a brokerage firm for investment services.
  
  
• The county's Schedule of Expenditures of Federal Awards (SEFA) contained numerous errors.� Expenditures were understated by approximately $95,000 in 2001 and overstated by approximately $4,000 in 2000.� In addition, the county has not established cash management procedures to ensure the minimum time lapses between receipt of federal project monies and the disbursement of such monies.
  
  
• Formal budgets were not prepared for several county funds and budgets for several other funds were not submitted to the State Auditor's Office as required by law.� The annual published financial statements did not include the financial activity of several county funds.
  
  
• County Commission minutes do not adequately document the daily business performed by the County Commission and the minutes are not signed by the preparer nor approved by a Commissioner who was in attendance.� Problems were noted with the handling of closed meetings.� Records were not always maintained by the County Commission in accordance with state law.
  
  
• Andrew County received advances from the Multi-County (ACCD) 911 Board which exceeded applicable mapping expenditures by $80,320.� This excess should be reviewed and possibly refunded.
  
  
• The Senate Bill 40 Board's financial records were neither accurate nor complete for a portion of the audit and bank reconciliations were either not performed or not documented since late 2000.� The board apparently levied property taxes at a level in excess of its financial needs. �Additionally, the board could not locate various financial records and are not ensuring board minutes are signed.
  
  
• Monies received by the Health Center are not deposited timely and differences identified on bank reconciliations are not investigated.� Actual expenditures were not accurately presented in the budget and supporting documentation was not retained for some expenditures. Applicable tax returns were not filed in a timely manner and compensatory time earned by employees is given at straight time instead of time and a half. ��In addition, minutes of closed meetings of the Health Center Board were not always prepared and minutes of open meetings did not always disclose the reason for closing a session.� Board minutes did not adequately document matters discussed and actions taken by the board.
  
  
• A state law, Section 50.333.13, RSMo, enacted in 1997, allowed salary commissions meeting in 1997 to provide mid-term salary increases for associate county commissioners elected in 1996 due to the fact that their terms were increased from two years to four.� Based on this law, in 1999 Andrew County's Associate County Commissioners salaries were each increased approximately $7,080 yearly, according to information from the County Clerk.

On May 15, 2001, the Missouri Supreme Court handed down an opinion that holds that all raises given pursuant to this statute section are unconstitutional.� Based on the Supreme Court decision, the raises given to each of the Associate County Commissioners, totaling approximately $14,160 for the two years ended December 31, 2000, should be repaid. �In addition, in light of the ruling, any other raises given to other officials within their term of office should be re-evaluated for propriety.

Also included in the audit are recommendations to the County Commission related to expenditures, county officials' salaries, the John Glenn Road Neighborhood Improvement District, general fixed assets, and computer controls.� In addition, recommendations were made to improve the accounting controls and procedures of the County Collector, Associate and Probate Divisions, Sheriff, and Prosecuting Attorney.

Complete Audit Report