HANCOCK COUNTY TABLE OF CONTENTS FINANCIAL SECTION_part7 ppt

OFFICE OF THE STATE AUDITOR STEVEN A. PATTERSON AUDITOR 3750 I-55 NORTH FRONTAGE ROAD JACKSON, MISSISSIPPI 39211 (601) 364-2888 FAX (601) 364-2828 63 INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH STATE LAWS AND REGULATIONS July 15, 1996 Members of the Board of Supervisors Hancock County, Mississippi We have audited the general purpose financial statements of Hancock County, Mississippi, as of and for the year ended September 30, 1995, and have issued our report thereon dated July 15, 1996. 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 general purpose 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 Auditor's Findings and Recommendations." The findings described in the accompanying "Schedule of Auditor's Findings and Recommendations" came to our attention as a result of the audit procedures and tests that we applied. For those items not tested, nothing came to our attention that would lead us to believe that Hancock County, Mississippi, had not complied with applicable state laws and regulations, other than those laws and regulations for which we noted violations in our testing referred to above. This report is intended for the use of the management. This is not intended to limit the distribution of this report, which is a matter of public record. WILLIAM S. JONES, CPA Director, Department of Audit 64 HANCOCK COUNTY (This page left blank intentionally) 65 HANCOCK COUNTY FINDINGS AND RECOMMENDATIONS 66 HANCOCK COUNTY (This page left blank intentionally) 67 HANCOCK COUNTY Schedule of Auditor's Findings and Recommendations For the Year Ended September 30, 1995 A. Findings for Independent Auditor's Report on the Internal Control Structure Based on an Audit of the General Purpose Financial Statements Performed in Accordance with "Government Auditing Standards": REPORTABLE CONDITIONS Chancery Clerk. 1. Finding As reported in the prior year audit report, the Chancery Clerk did not properly perform reconciliations of the land redemption account. Recommendation The Chancery Clerk should insure that the bank reconciliations are properly performed. Chancery Clerk's Response This has been corrected. Sheriff. 2. Finding As reported in the prior year audit report, expenditures exceed revenues in the inmate canteen fund for the fiscal year even though inventory purchased for resale had a high enough mark up to make a profit. Recommendation The Sheriff personally should monitor operations of the canteen to determine the cause of the deficit and take adequate measures to ensure this does not happen in the future. Sheriff's Response We now count inventory once a week, thereby, preventing over purchasing and currently, we do not have a deficit. 3. Finding As reported in the prior year audit report, we noted the following internal control deficiencies in the accounts handled by the Sheriff's Office: a. Proceeds from the commissary sales were not settled on a monthly basis to the county. b. Cash balances were not computed monthly and carried forward. 68 Recommendation The Sheriff should take whatever steps necessary to correct the deficiencies noted in internal controls. Sheriff's Response Settlements are being made by the 20th of each month beginning October, 1995, and monthly cash balances are being computed beginning April 15, 1996. Inventory Control Clerk. 4. Finding As reported in the prior year audit report, we noted that additions and deletions were sometimes not properly reflected in the general fixed assets account ledgers. Recommendation The Inventory Control Clerk should insure that the above deficiencies have been corrected. Inventory Control Clerk's Response I will correct the above problem as soon as possible. B. Finding for Independent Auditor's Single Audit Report on the Internal Control Structure Used in Administering Federal Financial Assistance Programs: REPORTABLE CONDITION Board of Supervisors. Finding As reported in the prior year audit report, the community development block grant (CDGB) expenditures were not reflected in the county's general ledger. Recommendation All federal grant expenditures should be included in the county's general ledger. Board of Supervisors' Response The CDBG referenced above successfully closed out during fiscal year ending September 30, 1995. In the future, the county will include all federal grants in its general ledger. 69 C. Findings for Independent Auditor's Report on Compliance with State Laws and Regulations: Board of Supervisors. 1. Finding Section 19-11-11, Miss. Code Ann. (1972), requires the Board of Supervisors to prepare a budget for all funds, except Trust and Agency Funds. Some funds were not budgeted. Recommendation The board should budget all funds. Board of Supervisors' Response The two funds questioned, Tidelands and Juvenile Detention Center funds, had no expenditure activity during the year. In the future, all funds received will be budgeted at a regular board meeting following receipt of the grant. 2. Finding As reported in the prior year audit report, Section 19-11-17, Miss. Code Ann. (1972), prohibits the incurring of expenditures in excess of the final budget as approved by the Board of Supervisors. Actual expenditures exceeded budgeted amounts in some funds. Recommendation The board should not make expenditures in excess of budgeted amounts. Board of Supervisors' Response Expenditures exceeded budgeted amounts because adjustments were made after the end of the fiscal year. 3. Finding Section 31-7-10(5) and 31-7-13(e), Miss. Code Ann. (1972), gives the county the authority to enter into contracts to lease purchase equipment and limits the number of years not to exceed five. The Board of Supervisors entered into a lease purchase agreement which exceeded five years. Recommendation The board should not enter into a lease purchase agreement which exceeds the five year limitation. Board of Supervisors' Response The lease term for the lease purchase commented on above, E-911 communication equipment, which was installed in three locations, was for 60 months commencing upon the completion of installation. Due to the length of time required to install the equipment, an interim financing arrangement was necessary. While the board feels that the two instruments are separate from 70 each other, it does want to comply with the state statute. In that regard, the board renegotiated the term of the lease with the bank to shorten it. 4. Finding As reported in the prior year audit report, Section 19-5-22, Miss. Code Ann. (1972), requires the Board of Supervisors to submit a list of delinquent garbage fee accounts to the Tax Collector so the arrearage can be collected. The board did not compile and submit the required list of delinquencies. Recommendation The board should insure that the list of delinquencies is compiled and submitted to the Tax Collector. Board of Supervisors' Response We will comply Chancery Clerk. 5. Finding As reported in the prior year audit report, Section 19-3-27, Miss. Code Ann. (1972), requires the Clerk of the Board of Supervisors to keep and preserve a complete and correct record of all board proceedings. We noted that the Board of Supervisors entered into an agreement with the City of Bay St. Louis authorizing the city to collect garbage fees for the county. This contract is not reflected in the minutes. Recommendation The Chancery Clerk should keep a complete and correct record of all board proceedings. Chancery Clerk's Response This agreement was signed by the board president on January 22, 1996, and placed in the minutes during the January term and also placed in the minutes when the mayor of Bay St. Louis signed it in March of 1996. . REGULATIONS July 15, 1996 Members of the Board of Supervisors Hancock County, Mississippi We have audited the general purpose financial statements of Hancock County, Mississippi, as of and for the year ended. page left blank intentionally) 65 HANCOCK COUNTY FINDINGS AND RECOMMENDATIONS 66 HANCOCK COUNTY (This page left blank intentionally) 67 HANCOCK COUNTY Schedule of Auditor's Findings and Recommendations For. the use of the management. This is not intended to limit the distribution of this report, which is a matter of public record. WILLIAM S. JONES, CPA Director, Department of Audit 64 HANCOCK COUNTY (This