Report No. 2010-59
Complete Audit Report
The following findings were included in our audit report on the Consolidated Public Water Supply District #4 of Clinton County.
The capital improvement plan has not been updated, and the amounts budgeted for capital projects in the annual budgets do not coincide with the amounts presented in the capital improvement plan. A 5 year capital improvement plan was prepared in 2006, which called for projects costing approximately $3.4 million during the year ended June 30, 2008, but the plan has not been updated since, and actual improvements have not occurred as planned. Budgets do not include information required by state law and no procedures exist to monitor budget to actual activity throughout the year. In addition, the water district does not maintain a list of capital assets, tag its capital assets, or perform physical inventories annually.
The Board's procedures for closing meetings are not in compliance with state law and minutes of closed meetings are not maintained as required. Typically the open session minutes indicated the meeting was being closed, but did not disclose the reason or the vote to close the meeting. Minutes were not maintained for any closed sessions held by the Board in recent years. The water district computers are not password protected and user identifications and passwords have not been established for use by the water district clerks.
The water district maintenance contracts are not adequately detailed and bills are not monitored by district personnel for compliance with contract terms. The water district paid approximately $444,000 for maintenance of the system during the 2 years ended June 30, 2009, but we indentified instances where amounts paid were not in accordance with contract terms. We also had concerns with the request for proposals process used in selecting the former and current maintenance contractors. The actual proposals received when selecting the former contractor were not maintained and no documentation or analysis was available to support the decision made in selecting the former contractor. Proposals solicited when selecting the current contractor were maintained, but documentation was not maintained to support how the district determined which proposal to accept.
The water district does not have documentation of how the new connection fee charged to customers was determined and adjustments to customer accounts are made without approval by the Board. Procedures for handling delinquent and late accounts have not been formalized and payment plans entered into with customers are not authorized by the Board.
The district has not adopted a formal bid policy. As a result, the water district did not solicit bids and/or retain bid documentation for some major purchases. In addition, proposals are not periodically solicited for some professional services contracted by the district.
The Board of Directors does not adequately monitor payroll disbursements and personnel policies, resulting in two former district clerks being overpaid upon their resignations in 2008. The former Clerk and Deputy Clerk were paid for unused vacation and sick/personal leave, although these payments were not authorized by personnel policies and we saw no evidence they were approved by the Board. The former Clerk, upon resignation, also received $1,370 as a prorated portion of the yearly incentive payment approved previously by the Board. A payment was established as a continuing employment incentive for this employee only, if she was still employed by the district at year end. The Clerk was not entitled to the incentive as she was not employed at year end. In addition, while timesheets are prepared by employees, they are not signed by the employee and do not indicate review and approval by the supervisor. Furthermore, water district employees working over 40 hours a week are awarded compensatory time at straight time; adequate records of vacation, sick, and compensatory leave are not maintained; and individual leave balances for employees are not adequately maintained.
Complete Audit Report
Missouri State Auditor's Office