OFFICE OF THE STATE AUDITOR_part5 docx

37 OFFICE OF THE STATE AUDITOR PHIL BRYANT AUDITOR INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH STATE LAWS AND REGULATIONS October 19, 1998 Members of the Board of Supervisors Yalobusha County, Mississippi We have audited the primary government financial statements of Yalobusha County, Mississippi, as of and for the year ended September 30, 1997, and have issued our report thereon dated October 19, 1998. The auditor's report on the primary government financial statements is modified because the primary government financial statements do not include the financial data of the county's component units, which should be included in conformity with generally accepted accounting principles. We conducted our audit in accordance with generally accepted auditing standards and the procedures prescribed by the State Auditor, and accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. As required by the state legal compliance audit program prescribed by the Office of the State Auditor, we have also performed procedures to test compliance with certain state laws and regulations. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the county's compliance with these requirements. Accordingly, we do not express such an opinion. The results of our procedures and our audit of the primary government financial statements disclosed certain immaterial instances of noncompliance with state laws and regulations. Our findings and recommendations and your responses are included in the accompanying Schedule of Findings. This report is intended for the information of management. This is not intended to limit the distribution of this report, which is a matter of public record. PHIL BRYANT RAMONA HILL, CPA State Auditor Director, Financial and Compliance Audit Division 38 YALOBUSHA COUNTY (This page left blank intentionally) 39 YALOBUSHA COUNTY SCHEDULE OF FINDINGS 40 YALOBUSHA COUNTY (This page left blank intentionally) YALOBUSHA COUNTY Schedule of Findings For the Year Ended September 30, 1997 41 A. Findings - Independent Auditor=s Report on Compliance and on Internal Control Over Financial Reporting Based on an Audit of the Primary Government Financial Statements Performed in Accordance With Government Auditing Standards Circuit Clerk. 97-1. Finding Section 7-7-211, Miss. Code Ann. (1972), gives the Office of the State Auditor the authority to prescribe accounting systems. The Circuit Clerk did not reconcile the bank accounts to the cash journals. Failure to reconcile the bank accounts as required by the Mississippi County Financial Accounting Manual could cause the records to be incorrect and some items to be misstated. Recommendation The Circuit Clerk should reconcile the bank statements to the cash journals each month. Circuit Clerk=s Response I will comply with your recommendation. Tax Collector. 97-2. Finding Section 7-7-211, Miss. Code Ann. (1972), gives the Office of the State Auditor the authority to prescribe accounting systems. The Mississippi County Financial Accounting Manual requires a separate cash drawer to be used for each person who collects taxes. As reported in last year=s audit report, we noted that there was only one cash drawer in the office for all deputies to use. This makes it difficult to establish responsibility for cash receipts. Recommendation The Tax Collector should install a separate cash drawer for each deputy to ensure that all collections are properly segregated and accounted for. Tax Collector=s Response I, Guy Dale Shaw, am very aware of your manual because 80% of your statewide accounting system originated from my office procedures, which were installed statewide. I differ with your recommendation because I do have one of the best internal cash control procedures in the state and it has worked very efficiently for 27 years. My deputies are bonded and I am under a $100,000 bond to assure that the taxpayers= money is handled properly, of which I, Guy Dale Shaw, am totally responsible. YALOBUSHA COUNTY Schedule of Findings For the Year Ended September 30, 1997 42 B. Finding - Independent Auditor's Report on Central Purchasing System, Inventory Control System and Purchase Clerk Schedules Purchase Clerk. Finding Section 31-7-103, Miss. Code Ann. (1972), requires a requisition, purchase order and receiving report for all purchases, except for those items enumerated by the Office of the State Auditor under the authority of Section 31-7-113, Miss. Code Ann. (1972), and except for purchases of not more than $100. We noted that some purchase documents appeared to have been prepared after the fact as indicated by the dates on the documents. Recommendation The Purchase Clerk should ensure that purchase transaction documents are issued when required and in compliance with the above statutes. Purchase Clerk's Response There was a misunderstanding on the fact of the purchase order total matching the invoice total. On purchase orders where an exact amount could not be determined at the time the purchase order was issued, the quantity and amount were being left blank until the invoice was received. I will comply by stating an estimated quantity and amount not to be exceeded. C. Findings - Independent Auditor's Report on Compliance With State Laws and Regulations Board of Supervisors. 1. Finding Section 83-39-31, Miss. Code Ann. (1972), requires the county courts to collect a fee of 2% or $20, whichever is greater, for appearance bonds accepted and the money collected is to be forwarded to the State of Mississippi. The county has collected these fees for several years, and the amount of the fees has accumulated in a county bank account, with no settlements made. The Board of Supervisors was told about this during the prior year audit, but they refused to authorize the Chancery Clerk to write the check to settle the fees to the state. Even though the State of Mississippi does not request the funds, it is the county=s responsibility to settle the funds. Recommendation The Board of Supervisors should authorize the Chancery Clerk to write the check and settle the fees to the State of Mississippi as required. Board of Supervisors= Response This matter will be considered by the Board of Supervisors. YALOBUSHA COUNTY Schedule of Findings For the Year Ended September 30, 1997 43 2. Finding Internal Revenue Service regulations require that all meal reimbursements to county employees that do not involve overnight travel be included as taxable income to the employee and the proper deductions made. We noted that there were several instances in which county employees were reimbursed for meals, but the reimbursement was not included on their W-2 form as income. Recommendation The Board of Supervisors should ensure that any reimbursements for meals that do not involve overnight travel are included as taxable income to the county employee. Board of Supervisors= Response We will comply. Chancery Clerk. 3. Finding Section 9-1-43, Miss. Code Ann. (1972), requires the Chancery Clerk to maintain a cash journal to account for the receipts and expenses related to the operation of the office. We noted the following deviations from the prescribed system: a. Receipts were not written for all collections over $10. b. The cash journal was not reconciled to the bank account. c. A log was not maintained to document amounts claimed as travel expenses. Recommendation The Chancery Clerk should write receipts as required, reconcile the bank account to the cash journal and maintain adequate documentation for all expenses. Chancery Clerk=s Response I will comply. Circuit Clerk. 4. Finding Section 9-1-43, Miss. Code Ann. (1972), requires the Circuit Clerk to maintain a cash journal to account for the receipts and expenses related to the operation of the office. We noted the following deviations from the prescribed system: a. The cash journal was not reconciled to the bank account. b. A log was not maintained to document amounts claimed as travel expenses. YALOBUSHA COUNTY Schedule of Findings For the Year Ended September 30, 1997 44 Recommendation The Circuit Clerk should reconcile the bank accounts to the cash journal and maintain adequate documentation for all expenses. Circuit Clerk=s Response I will comply with your recommendation. Justice Court Clerk. 5. Finding Section 9-11-19, Miss. Code Ann. (1972), states that it is the duty of every Justice Court Clerk to settle fees, costs, fines and penalties to the Clerk of the Board of Supervisors each month. The Deputy Justice Court Clerk in the Coffeeville office was appointed as a clerk for that district and, when she was appointed, it became her duty to account for and settle the fees, costs, fines and penalties collected in the Coffeeville office to the Clerk of the Board of Supervisors. As reported in last year=s audit report, the clerk in the Coffeeville office did not settle monthly collections to the Clerk of the Board of Supervisors as required but, instead, sent the collections to the Justice Court Clerk in the Water Valley office for him to include with his settlement. Recommendation The Justice Court Clerk in the Coffeeville office should settle all collections each month to the Clerk of the Board of Supervisors instead of the Justice Court Clerk in the Water Valley office. Justice Court Clerk=s Response This will be corrected. Justice Court Judge - John Webster. 6. Finding Section 9-11-3, Miss. Code Ann. (1972), states that if a Justice Court Judge fails to file a certificate of training in the office of the Chancery Clerk, the judge shall not be entitled to compensation for the period of time during which the certificate remains unfiled. Judge John Webster has not filed any certificates of training for the years of 1997 and 1998. Judge Webster was paid over $37,000 during this time period. YALOBUSHA COUNTY Schedule of Findings For the Year Ended September 30, 1997 45 Recommendation Judge Webster should not receive any further compensation until the required certificates are filed with the Chancery Clerk. Justice Court Judge Webster=s Response I have mailed a request to the Mississippi Judicial College for permission to watch videos of the Justice Court Judges= seminar that I have missed at home. I have a severe lung disease that requires four daily treatments plus oxygen. I am waiting for their reply. . Coffeeville office to the Clerk of the Board of Supervisors. As reported in last year=s audit report, the clerk in the Coffeeville office did not settle monthly collections to the Clerk of the Board of. 37 OFFICE OF THE STATE AUDITOR PHIL BRYANT AUDITOR INDEPENDENT AUDITOR& apos;S REPORT ON COMPLIANCE WITH STATE LAWS AND REGULATIONS October 19, 1998 Members of the Board of Supervisors Yalobusha. except for those items enumerated by the Office of the State Auditor under the authority of Section 31-7-113, Miss. Code Ann. (1972), and except for purchases of not more than $100. We noted that