Report No. 2009-99
September 2009
Complete Audit Report

The following findings were included in our audit report on Caldwell County.

The County Clerk and County Collector-Treasurer have not developed adequate procedures to ensure all financial activity involving county monies is properly recorded in the accounting records and accurately reported in the county budgets and financial statements. Problems were identified with the bank reconciliations performed by the County Collector-Treasurer and she was unable to explain various reconciling items. Receipt and disbursement amounts did not agree between the Collector-Treasurer and County Clerk for various major funds. These differences were not identified by county officials due to lack of controls over financial reporting. In addition, other compliance and internal control problems in the Collector-Treasurer office were identified.

Budgets prepared by the County Clerk's office are inaccurate, do not present a true picture of the financial activity of some county funds, and do not include all information required by state law. The county revised the 2008 budget changing most of the actual receipt and disbursement figures for 2007, but it is unclear how these new amounts were derived. In addition, actual receipts, disbursements, and cash balances for 2007 for some funds still do not agree to amounts reported by the County Collector-Treasurer for 2007. Furthermore, the County Clerk does not maintain adequate supporting documentation for numbers reported in the county's budget. Budget to actual reports are not regularly prepared and reviewed by county officials, resulting in disbursements in excess of approved budgeted amounts for several funds. The county's annual published financial statements did not include some information required by law, and two county funds were deficit budgeted, which violates state law.

The County Commission and County Clerk do not provide adequate oversight of the activities of the County Collector-Treasurer. As a result, errors were not identified and investigated. Various problems were identified with the County Collector-Treasurer's bank reconciliations and passwords for the county's tax system are not changed periodically or kept confidential.

The county has not developed adequate procedures for the review and approval of disbursements and adequate oversight of these processes is not in place. In December 2008, a former employee in the County Clerk's office increased the amount of a bank loan payment by $2,500 and received the extra money back in cash. Some monetary awards and gifts purchased with county funds were given to employees of the Detention Center, Sheriff's Department, 911 Center, and Prosecuting Attorney's office. These items were not reported on the employees' W-2 forms nor subjected to tax withholdings, and included: four laptop computers and software ($3,200); cash bonuses ($1,000) to some employees; a rifle ($1,100) given to a deputy sheriff; and $50 gift vouchers to all Sheriff’s Department, detention center, and 911 employees. Spending from the Sheriff's Civil Fees Fund was excessive in 2008 compared to the previous years the former Sheriff was in office, and in particular spending escalated after August 2008, when the former Sheriff lost the primary election. Approximately $2,500 worth of give away items were purchased in May 2008 on a county credit card by the former Sheriff to be distributed at various county functions. These items were eventually paid for from the Sheriff's Civil Fees Fund and included several items which bore the former Sheriff's name. The County Commission indicated these items were campaign related giveaways. The former Sheriff was paid a total of $725 to attend a Sheriff's training in October 2008 which he did not attend. In addition, some concerns were identified with county bidding, lack of contracts for services, and insufficient documentation for some disbursements.

Documentation to support transfers totaling over $3.4 million from the Law Enforcement Sales Tax (LEST) Fund to the General Revenue Fund was insufficient to ensure amounts paid were reasonable.

The County Commission failed to comply with the Sunshine Law regarding the handling of closed session meetings and procedures for documenting and approving meeting minutes should be addressed.

The county does not adequately monitor the County Aid Road Trust (CART) and sales tax balances available to the 12 townships in the county to ensure adequate funds are available to pay invoices. The County Clerk did not ensure township boards' financial statements were published as required by state law.

Annual settlements were not filed in a timely manner and monthly bank reconciliations are not performed in the Public Administrator's office. The Public Administrator inconsistently charged fees depending on the availability of funds in the wards’ estates, and lacked documentation to support the fees that were charged. The Associate Circuit Judge does not require the Public Administrator to submit supporting documentation for all disbursements.

The County Commission has not maintained adequate oversight of the Little Otter Creek Watershed Project. The county has not maintained adequate records of the amounts received, disbursed, and cash on hand. The planning for this project began in 2001, and cost estimates were prepared during that time period, but the county has not taken steps to update those original cost estimates. While annual costs of the project are reported in the county budget, the county has not adequately tracked the progress and costs to date of the project, compared to the original estimates. As of December 31, 2008, approximately $2.5 million has been spent on the project.

Other findings in the audit report relate to travel expenses, payroll policies and procedures, capital assets, and controls and procedures of planning and zoning, the Circuit Clerk, the Sheriff, and the detention center.

Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov