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YELLOW SHEET
Office of the State Auditor of Missouri
Claire McCaskill
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Report No.2004-64
August 31, 2004
IMPORTANT: The Missouri
State Auditor is required by
state law to conduct audits once every 4 years in counties, like Cedar, that do
not have a county auditor. In addition to a financial and compliance audit of
various county operating funds, the State Auditor's statutory audit covers
additional areas of county operations, as well as the elected county officials,
as required by Missouri's Constitution.
This audit of Cedar County included additional
areas of county operations, as well as the elected county officials. The
following concerns were noted as part of the audit:
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The Schedule of Expenditures of Federal Awards
(SEFA) prepared by the County Clerk was not complete or accurate. The SEFA
was over (under) stated during the years ending December 31, 2003 and 2002 by
$691,426 and (264,000), respectively.
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A tornado caused significant damage to county
property in May 2003, and as a result, the county was awarded Federal
Emergency Management Assistance (FEMA) to repair and rebuild its property.
The County Commission appears to have circumvented federal prevailing wage
laws and procurement requirements of the FEMA program during the
reconstruction of its road and bridge department building which incurred
damages during the tornado in May 2003. Adequate supporting documentation
also was not obtained to support some payroll expenditures incurred related to
this project. Additionally, the County Clerk's office did not file
reimbursement claims in a timely manner, and the county has not properly
monitored its subrecipient's (County Health Center and County Library)
expenditures for FEMA. Further, accounting duties related to the FEMA program
were not adequately segregated, and the County Clerk had no statutory
authority to hold the FEMA account outside the County Treasury.
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The County Commission failed to review all
applicable statutes related to the handling of delinquent property tax sales
to ensure they were protecting taxes due and to prevent any loss to other
taxing authorities involved from possible inadequate bids received. The
County Collector also failed to adequately advertise the property for sale
prior to selling the property to an Associate County Commissioner. The
Associate Commissioner sold this piece of property approximately one year
later.
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The County Clerk did not reconcile her
accounting records monthly with the County Treasurer from April to December
2003 because she hired a new clerk in April 2003 that was not familiar with
the accounting system. Numerous adjustments were made to the County Clerk's
expenditures for errors in recording health insurance. As of April 14, 2004,
the County Clerk had again not reconciled her records to the County Treasurer
for January through March 2004. In addition, the county's budgets were not
accurate.
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The county's quarry is not operating as
originally estimated by the County Commission nor has the county paid off its
original investment. The County Commission estimated they would quarry gravel
at a rate of savings that would pay off its original investment, of $78,475,
in just over five years. At December 31, 2003 the County Commission reported
savings to be only $24,800 during the four years since the original investment
made in February 2000. The County Commission also entered into a loan
agreement which appears to violate the Missouri Constitution and did not
adequately document its evaluation of the financing arrangements, funds
available, and interest costs associated with the loan.
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Improvements are needed with the property tax
system controls and procedures. In addition, the County Clerk does not
prepare the current or back tax books or maintain an account book with the
County Collector and controls over property tax additions and abatements are
not adequate.
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Numerous problems were noted relating to
Prosecuting Attorneys' accounting controls and procedures. Although many of
these problems were noted in the previous audit of the Prosecuting Attorney's
office, little attempt has been made to implement these prior
recommendations. Procedures for the timely processing and subsequent
disposition of bad checks have not been established, and as a result, the
Prosecuting Attorney has lost the authority to collect some bad checks for
merchants. Court ordered restitution payments totaling over $17,000 were also
not disbursed to the victims in a timely manner. Additionally, weaknesses
included inadequate segregation of accounting duties and controls over
receipts, the failure to make deposits timely, to prepare monthly bank
reconciliations, and to reconcile liabilities to cash balances. Further, the
Prosecuting Attorney failed to periodically back up bad check complaint
information and print and retain monthly reports.
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The Public Administrator did not file annual
settlements in a timely manner, and funds of an estate were not properly
covered by collateral securities. In addition, Forms 1099-MISC were not
issued for legal services, and fees owed to the county from some estates were
not always collected by the Public Administrator.
Also included in the audit were recommendations
related to officials' compensation and bonds, budgetary practices, expenditures,
property tax system, personnel policies, general fixed assets. The audit also
suggested improvements in the procedures of the County Clerk and the Sheriff.
Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov