The County Clerk made various errors on federal tax returns and related forms and in making remittances of federal taxes. During 2006 the county paid approximately $13,000 to the IRS for unpaid taxes, penalties and interest. At June 2007 the county owed the IRS approximately $22,000 for unresolved errors pertaining to previous years. Reporting and/or payment errors occurred during 2004, 2005, and 2006, and, despite receiving numerous Internal Revenue Service (IRS) notices, some had not been resolved as of September 2007. The County Clerk does not have adequate controls for ensuring the amounts paid and reported to the IRS are accurate and consistent. Because county officials did not act promptly to research and resolve the various problems with the IRS, the county has paid and still owes a significant amount in underpaid taxes, penalties, and interest. A review of county payroll records and reports indicates some errors may have been reporting rather than payment errors, and at least a portion of the additional tax liability, penalties, and interest amounts may have been avoided.
Various billings from October 2006 through June 2007, totaling approximately $36,800, for unemployment taxes, utilities, and state income tax withholdings were not promptly paid and, consequently, the county incurred late payment penalties totaling approximately $3,100. Other payments during this period including employee deferred compensation payments and employee health insurance premiums were also untimely. While the county was not penalized for these late remittances, county officials should ensure obligations on behalf of its employees are met.
The county did not always solicit bids, develop adequate bid specifications, or retain bid documentation for various purchases. In addition, neither the County Commission minutes nor the expenditure records contained adequate documentation of the county's efforts to compare prices, explanations for contract changes, or reasons for sole source purchase determinations. Also, federal procurement rules were not followed for some equipment purchases made with federal grant monies.
The county does not have adequate procedures in place to track federal awards for the preparation of the Schedule of Expenditures of Federal Awards (SEFA), and as a result, expenditures for federal grants were not always reported correctly on the schedule. For example, the 2006 Highway Planning and Construction Program expenditures were overstated by more than $630,000.
Property tax system procedures and controls are not sufficient. The County Clerk does not prepare or verify the current and back tax books or maintain an account book with the County Collector. Neither the County Clerk nor the County Commission verify the County Collector's settlements or adequately review property tax additions and abatements. The County Clerk indicated that he does not intend to review additions and abatements, maintain an account book, or verify the Collector’s annual settlement.
The Circuit Clerk and Ex Officio Recorder of Deeds does not always receipt and deposit monies on a timely basis and, for bank accounts of the Circuit Clerk, has not followed-up on old outstanding checks or disbursed monies on old inactive cases.
For the various bank accounts of the Sheriff's office, bank reconciliations are not consistently and accurately performed. Additionally, monies received are not always deposited intact on a timely basis and documentation showing the disposition of jail receipts is not always retained.
Bank reconciliations for the Senate Bill 40 Board’s accounts are not prepared and transaction registers were not always maintained. Also, the board's budget preparation procedures do not ensure that the budget documents reasonably reflect the board's anticipated financial activity and cash balances, and lessen the effectiveness of the budget as a tool for monitoring or controlling board disbursements and for decision-making about the board's tax levy.
The audit also includes recommendations to the county to improve records and procedures related to county property, vehicles, and budgets.
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