Report No. 2010-154
November 2010
Complete Audit Report

Findings in the audit of Miller County

Sheriff’s Undercover Investigations and Other Disbursements
The Sheriff could not provide adequate documentation to support checks cashed for $19,884 issued from the Sheriff's Discretionary Fund for undercover operations. Between May 9, 2006 and December 31, 2009, the Sheriff requested and cashed checks totaling $21,738. The Sheriff indicated the cash was used for drug buys and paying informants; however, documentation to support the payments was only provided for $1,854. For both 2008 and 2009, the Sheriff and the Mid-Mo Drug Task Force prepared annual summaries of disbursements for undercover operations; however, the summaries provided few details. The Sheriff did not properly account for monies returned by the Task Force on failed drug buy operations. We also identified credit card disbursements and travel advances from the Sheriff's Discretionary Fund for which there was no supporting documentation.

Sheriff’s Accounting Controls and Procedures
Prior audit reports have addressed the inadequacy of the Sheriff's accounting procedures, and significant weaknesses in the Sheriff's accounting controls and procedures still exist. In May 2009, the Sheriff determined the existence of missing monies which resulted in an investigation and the payment of restitution totaling $3,000 by two former employees. Weaknesses in controls and procedures allowed this situation to go undetected. Accounting duties are not adequately segregated, and the various receipt records are not adequately reconciled to ensure all receipts have been recorded and deposited. Procedures do not exist to identify month-end liabilities and reconcile liabilities to cash balances. In addition, the Sheriff does not have proper controls to ensure timely collection of amounts billed to other counties or cities for housing of inmates, and does not transmit civil fees to the County Treasurer on a monthly basis as required by state law.

Financial Condition
As noted in our prior audit report, the Jail Fund and Special Road and Bridge Fund continue to be in poor financial condition, and the financial condition of the General Revenue Fund has deteriorated. The county has relied on transfers from the Capital Improvement Tax Fund for operating expenses. The General Revenue Fund has also experienced a significant decrease in sales and use tax revenues.

Fuel Usage
As similarly noted in our prior audit, the county has not established effective monitoring procedures regarding fuel use. Mileage and fuel use logs are not maintained for most vehicles and equipment, and fuel use is not reviewed or reconciled to fuel purchases.

Payroll and Related Matters
County procedures require salaried employees to prepare and submit monthly timesheets by the 6th day of the following month; however, county employees are paid once every two weeks. As a result, the county makes numerous adjustments during subsequent pay periods when timesheets are submitted. Leave and compensatory time records for Sheriff's employees were not accurate and are not submitted to the County Clerk's office. The county's personnel policy manual is out of date and concerns were noted with vacation leave and compensatory time balances.

Capital Assets
As noted in previous audits, procedures and records to account for county property are not adequate. The County Clerk does not have procedures to identify capital asset purchases and dispositions throughout the year. Capital asset records have not been updated and physical inventories have not been performed since 2003. Records lack some necessary information, and some capital assets are not numbered, tagged, or otherwise identified as county property.

County Collector’s Accounting Controls and Settlements
The County Collector does not compare the reconciled bank account balances to existing liabilities on a monthly basis. The liabilities exceeded the reconciled bank balance by $18,410 at February 28, 2010. The County Collector does not have proper controls for recording and handling insufficient fund checks. When a check is returned for insufficient funds, the County Collector does not reduce this amount from property tax collections, so these amounts are distributed to the taxing authorities even though the monies have not actually been received. The County Collector's annual settlements for the years ended February 28, 2009, and February 28, 2010, were not filed until June 17, 2009, and August 20, 2010, respectively, and contained several errors and omissions. While the County Clerk and the County Commission indicated they perform a review of the annual settlements, their review was not documented and did not detect the errors in the County Collector's settlements. The County Clerk does not maintain an account book or other records summarizing property tax transactions.

Prosecuting Attorney’s Accounting Controls and Procedures
Procedures are not in place to routinely identify month-end liabilities and reconcile liabilities to cash balances. Unidentified amounts have been in the bank account since 2007. In addition, monies received are not always deposited or transmitted timely or maintained in a secure location.

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