County knocked for loack of internal controls

Departments do not effectively communicate to ensure the financial information they share is accurate.

The county does not perform a complete and accurate reconcilation of financial statements with activity reported by the bank and the general ledger.

The county does not have an effective review of financial statements to detect significant reporting errors or ommissions.

Procedures, including oversight, are not in place to ensure the county follows changes in the required Budgeting, Accounting and Reporting System (BARS), which include schedules used to reconcile and report cash and investment balances.

"These deficiencies in internal controls make it reasonably possible that serious misstatements could continue to occur and not be prevented or detected by the county in future years," the report noted.

Auditors stated the cause of the condition rests with the Board of County Commissioners. They said the county board "has not assigned responsibility for ensuring internal controls and processes are designed to provide accurate accounting and financial reporting for the county as a whole. In addition, the county has not prioritized and dedicated the necessary resources to establish effective accounting processes."

As a consequence, auditors said, the county's financial information in 2011 "contained significant errors, some of which were known and others that were not detected by county management."

Auditors found in the original financial statements they received for audit that the county over-reported cash and investments in its 2011 financial statements by $111,752 because it didn't reconcile ending cash and investments to actual amounts held by financial institutions in the county's name.

The county also performed adjustments in five funds to reconcile financial activity between prior and current year ending cash positions but lacked the documentation to support adjustments totaling $942,402.

Moreover, auditors noted "the county did not accurately or completely adjust revenue and expenses when it switched accounting systems from generall accepted accounting principles to cash-basis, resulting in reporting errors for both revenues and expenses, which we were unable to quantify."

In their response to the audit team's finding and four recommendations, county officials said the county is committed to resolving the issue and putting into place more effective internal controls by developing and/or improving upon the processes and controls necessary for the preparation of an accurate annual report and other financial reports of the county.

"Over the coming weeks, the Board of County Commissioners will work together with the responsible departments to identify the causes of the deficiencies mentioned in the finding and determine the appropriate corrective measures to ensure accurate reporting in the future," county officials wrote.