YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

September 28, 2001

Report No. 2001-103

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

• The county does not have adequate procedures in place to track federal awards for the preparation of the schedule of expenditures of federal awards.  For the years ended December 31, 2000 and 1999, the schedule contained a number of errors and omissions with expenditures overstated by approximately $72,555 and $43,092 for 2000 and 1999, respectively.

• Several concerns were noted related to the county budget documents, including unreasonable estimates of receipts and disbursements, overspending budgeted amounts, and not preparing budgets for several county funds.

• The county paid $44,000 to a not-for-profit corporation for a downtown revitalization project and $23,128 to the City of Neosho for a paving project without entering into written contracts for the related projects.

• The county does not have an official policy for cellular phone usage.  During the year ended December 31, 2000, over $13,700 was spent for phone charges for 40 cellular telephones assigned to various county employees.  Billing statements submitted to the County Commission provide no detail of the actual usage.  Procedures are not in place to provide a documented review of the actual phone usage to determine whether the cellular phones are being used for official county business.

• Computer controls are in need of improvement, including the processing of changes to assessment data, passwords, log-on procedures, and a formal contingency plan.

• A state law, Section 50.333.13, RSMo, enacted in 1997, allowed salary commissions meeting in 1997 to provide mid-term salary increases for associate county commissioners elected in 1996 due to the fact that their terms were increased from two years to four.  Based on this law, in 1999 Newton County’s Associate County Commissioners salaries were each increased approximately $10,000 yearly, according to information from the county clerk.  

      On May 15, 2001, the Missouri Supreme Court handed down an opinion that holds that all raises given pursuant to this statute section are unconstitutional.  Based on the Supreme Court decision, the raises given to the Associate County Commissioners (the two elected and one appointed), totaling approximately $40,000, for the two years ended December 31, 2000, should be repaid. 

• Accounting controls and procedures including segregation of duties, follow-up on old bond monies and outstanding checks, and depositing procedures are in need of improvement in the sheriff’s office.  Additionally a reserve deputy collects and transports bonds at a local truck weight scale and is compensated on a fee basis per individual ticketed, rather than by salary, contrary to state law.  The reserve officer was paid fees totaling $32,670 and $36,105 for 2000 and 1999, respectively.

Also included in the audit are recommendations related to bidding procedures, personnel policies, closed meeting minutes, fixed assets, and vehicle procedures.  The audit also suggested improvements in the procedures of the Collector, Prosecuting Attorney, Circuit Clerk, Ex-Officio Recorder of Deeds, and the Health Center.  Several of these issues have been mentioned in prior audits.

Complete Audit Report