YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

December 29, 2000

Report No. 2000-135

IMPORTANT:  The Missouri State Auditor is required by Missouri law to conduct audits only once every four years in counties, like McDonald, 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 McDonald County included additional areas of county operations, as well as the elected county officials.  The following concerns were noted as part of the audit: 

• As noted in the prior report, the county did not distribute a portion of its General Revenue Fund property tax collections to the Special Road and Bridge Fund as authorized by a ballot issue approved by the voters.  At December 31, 1999, the General Revenue Fund owed $217,580 to the Special Road and Bridge Fund. 

• It appears the county has exhausted most of its accumulated cash balance in the General Revenue Fund and continues to spend at a level that is beyond its ability to fund.  The county is financing general operating activities by improperly retaining road monies.  The county’s budget for the year ended December 31, 2000, projects the ending cash balance of the General Revenue Fund to be $6,869 with no expected transfer of property taxes to the Special Road and Bridge Fund.  In addition, the county is close to exceeding the maximum amount of debt that it can legally incur considering the required property tax monies due the Special Road and Bridge Fund and the liabilities for two loans the county has outstanding for patrol cars and the courthouse addition.

• Actual disbursements exceeded budgeted amounts for some funds.  Budgets were not prepared for the Domestic Violence Fund and the DARE Fund.  The annual published financial statements of the county did not include the financial activity of some county funds as required.  In addition, several funds had negative cash balances at year end.  

• The county generally made efforts to seek competitive bids for most major purchases; however, several items purchased by elected officials and the county were noted in which bids were not solicited, nor was bid documentation always retained.  Additionally, contrary to county policy, the county allowed the road and bridge grader operators to grade private roads in the county, without keeping track of the roads graded.  

Also included in the audit are recommendations to improve the county’s personnel policies and procedures, land acquisition procedures and verification of county property tax books.  In addition, the audit recommended improvements in the accounting controls and procedures for the courts under the Circuit Clerk’s authority, Sheriff, Prosecuting Attorney, and the Health Department.