YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

August 30, 1999
Report No. 99-68

IMPORTANT: The Missouri State Auditor is required by Missouri law to conduct audits only once every four years in counties, like Ralls, which do not have a county auditor. However, to assist such counties in meeting federal audit requirements, the State Auditor will also perform a financial and compliance audit of various county operating funds every two years. This voluntary service to Missouri counties can only be provided when state auditing resources are available and does not interfere with the State Auditor's constitutional responsibility of auditing state government.

Once every four years, the State Auditor's statutory audit will cover additional areas of county operations, as well as the elected county officials, as required by Missouri's Constitution.

This audit of Ralls County included additional areas of county operations, as well as the elected county officials. The following concerns were noted as part of the audit:

Ralls County's General Revenue Fund is experiencing a declining cash balance. The cash balance has basically decreased from $193,572 at January 1, 1997 to $4,229 at December 1998. The audit suggested the county review expenditures and reduce discretionary costs.

As similarly noted in the prior two reports, the approved budget documents still do not adequately project the anticipated financial condition of the Special Road and Bridge Fund. The County Commission indicated that, to plan for unforeseen emergencies and to avoid overspending the approved budget, they budget to spend all beginning cash available plus all estimated receipts for the year. The audit indicated such a practice results in the loss of the budget as a management tool and control over disbursements. The audit also questioned the county's procedures for calculating administrative fees charged to the Special Road and Bridge Fund.

The county directly paid 911 Fund costs totaling $70,333, and authorized operating transfers of $6,052, from the Special Road and Bridge fund. The county indicated that 911 employees do some work for the Road and Bridge department but maintained no documentation supporting the amounts charged. As state law and the Missouri Constitution restrict the use of the Special Road and Bridge Fund, the audit recommended the county review such practices with legal counsel.

The county's documentation of bidding procedures needs improvement. The county verbally had reasons for some actions but had not documented such things including why higher bids were sometimes accepted.

Also included in the audit are recommendations regarding expenditures of county funds, personnel policies, and general fixed asset procedures. The audit also suggested an adequate segregation of duties or independent oversight in the Circuit Clerks' Child Support Office, the Associate Circuit Clerk's Office, and the Sheriff's Office.

Complete Audit Report