YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2005-72

September 2005

IMPORTANT:  The Missouri State Auditor is required by state law to conduct audits once every 4 years in counties, likeWebster, 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 Webster County included additional areas of county operations, as well as the elected county officials.  The following concerns were noted as part of the audit:

• Webster County's General Revenue fund has been experiencing a declining cash balance since December 31, 2002.  While receipts have increased each year, they have not kept pace with the increase in disbursements, and based on 2005 projections the county does not anticipate the financial condition of the General Revenue fund to improve during the current year.  Some of the increases in disbursements appear to be unavoidable, such as increases in statutory salaries and insurance costs.  Other factors include costs related to the purchase and sale of land for a judicial center, and the untimely filing of grant reimbursement requests. Additionally, approximately $28,900 is due from the General Revenue fund and the Assessment fund to local school districts because of an error in computing property tax distributions, and a significant liability of approximately $49,000 exists in accumulated employee compensatory time balances.  The Commission is aware of the financial condition of the County and has had meetings with various county officials informing them of the status of the General Revenue fund cash balance. 

• The county lost $17,110 on the purchase and subsequent sale of 10 acres purchased for the potential site of a new judicial center.  Additionally, the county did not adequately evaluate the details of an agreement with the buyer of the land that exchanged topsoil for the rebuilding of a fence.  As a result, it is unclear if the county received an equitable exchange of goods and services. 

• Controls and procedures over county expenditures need improvement.  Credit card transaction limits can be circumvented, and adequate documentation is not always retained for credit card purchases.  In addition, some expenditures appear questionable, and written agreements were not obtained in some instances.

• County budgets and financial reporting need improvement.  The Road and Bridge fund annual budget prepared by the County Clerk and approved by the County Commission for 2004 did not include $959,425 the county had received in Public Assistance Grants.  Additionally,  disbursements were made in excess of the approved budgets for several funds.

• The Sheriff's department did not properly complete the grant reimbursement request process for claims totaling approximately $31,000.  One claim form was prepared but not filed with the federal government, while another claim form was filed but the county neglected to request the funds be deposited into their bank account.

• The Sheriff did not compare invoices to the written agreement for legal services, resulting in $834 more being paid for those services than agreed upon.  Further, the Sheriff paid a consulting firm $2,321 without obtaining a written agreement. 

• Controls over receipts and disbursements of the Sheriff's Department need improvement.  Additionally, seized property records are not always updated timely, and duties are not adequately segregated.

• Errors were noted in amounts reported on the Collector's annual settlement and in withholdings made from school taxes.  Further, bank account balances are not reconciled to liabilities, outstanding checks are not routinely followed up on, duties are not adequately segregated, and controls over property tax receipts need improvement.

• Deficiencies were noted in the internal control and accounting procedures used by the Prosecuting Attorney's office.  Monies are not deposited timely and are not always recorded in the bad check system.   Also, numerous errors were identified in the calculation of the checkbook balance, and monthly listings of open items (liabilities) are not prepared and consequently, are not agreed to the reconciled bank balance. 

• Records and procedures of the Associate Circuit Division need improvement.  Bank reconciliations are not prepared monthly, receipts are not deposited timely, and procedures for surety bond forfeiture need improvement.  Additionally, an interest fund ledger is not maintained, and the fund is not budgeted in accordance with state statute.

• The Emergency 911 Board overspent the 2004 budget and the 2005 budget was not properly prepared.  Additionally, improvements are needed in documenting the board's approval of invoices, soliciting bids, and documenting employee time.

Also included in the audit recommendations related to the schedule of federal awards, closed meetings, payroll, a road maintenance plan, and capital assets.  The audit also suggested improvements in the procedures of the Public Administrator, Circuit Clerk, and the Health Center Board.

Complete Audit Report