YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2006-41

July 2006

The following findings were included in our audit report on the Village of Truxton, Missouri.

On at least three occasions, the village Board of Trustees approved transactions between the village and a board member or a relative of a board member.   The board minutes do not document which trustees voted to approve these transactions.  These transactions included awarding mowing bids to the son of the former board chairman in 2003 and 2004, awarding a mowing bid to the husband of a trustee in 2005, and approving a contract with property owners adjacent to the village hall, which included a trustee, to supply water to the village hall.  Decisions where potential conflicts of interest exist should be completely documented so that the public has assurance that no village official has benefited improperly.

The village did not consider the unreserved Sewer Fund balance of approximately $16,000 when approving a sewer rate increase in 2006.  In addition, the district has not had an annual audit of the Sewer Fund as required by state law.

For the year ended April 30, 2005, the village's actual expenditures exceeded amounts budgeted for the General Fund and the Sewer Fund by $12,016 and $1,813, respectively.  Additionally, for the year ended April 30, 2004, the village overspent the General Fund budget by $2,405.

Budgets have not been approved by the Board of Trustees on a timely basis, and did not include required information.  State laws set specific budget format and approval guidelines and also provide that no disbursement of public monies be made unless authorized in the budget.

The village has allowed the balance of the Street Fund to increase, and the village does not prepare annual maintenance plans for village streets or otherwise inform the taxpayers of the village's intended use of the balance of the Street Fund.

The village does not have a formal bidding policy.  Bids were not solicited for the village hall mobile home or the village computer.  The village has not solicited proposals or entered into written contracts for various contracted services, including legal, accounting, and animal control services.  Furthermore, the village did not file Forms 1099 with the Internal Revenue Service for payments made for accounting, legal, mowing, and mobile home moving/hook-up service.

Also included in the report are recommendations related to board meeting minutes, agendas and ordinances, financial reporting, and accounting controls and procedures.

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