YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2005-50

July 2005

The following problems were discovered as a result of an audit conducted by our office of the City of Branson West, Missouri. 

Improvement is needed in the city's procurement of professional services.  The City of Branson West has conducted at least five major projects in recent years requiring engineering services.  While the City Administrator indicated that proposals were solicited for engineering services for all five projects, documentation was not maintained to identify the various proposals received and other individuals/firms considered for two of the five projects with engineering costs totaling $482,000.  The City Administrator previously worked for the engineering firm that received the contract on four of the five projects.  Additionally, the city did not retain adequate documentation to identify the various proposals received for legal and accounting services totaling $86,000 during the year ending September 30, 2004.

Supporting documentation was not retained or available for some expenditures, including credit card expenditures.  The city did not always solicit bids in accordance with city ordinances.  Bids were either not solicited or bid documentation was not retained for 22 of the 24 expenditures reviewed.  Additionally, the city does not have written travel expense policies, and instances were noted where the city reimbursed employees for both fuel and mileage expenses for business travel.

The city has entered into a multi-year employment contract with the City Administrator that does not specify termination compensation, and contains automatic raises annually.  

Building inspections and follow-up inspections are not always adequately documented in city permit files.  In addition, the city does not have policies and procedures addressing when performance bonds should be required or how the dollar amount should be calculated.

The city has not formally reviewed the adequacy of water and sewer rates since 1997.  The city's audited financial statements show an operating loss of approximately $463,800 in the Water and Sewer Funds during the year ending September 30, 2003.  To compensate for the operating loss funds were transferred from the general and capital improvement sales tax funds. 

Also included in the report are recommendations related to restricted revenues, city vehicles, financial reporting, accounting controls, city ordinances, and the municipal division.

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