YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

September 20, 2001

Report No. 2001-89

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

• Prior audit reports have addressed the inadequacy of the Prosecuting Attorney’s accounting controls and procedures.  A special review report from 1998 concluded cash receipts were misappropriated and made numerous recommendations for improvement.  While the Prosecuting Attorney responded in the 1998 audit, as well as other previous audits that recommendations would be implemented, conditions have not improved  This audit identified weaknesses such as inadequate segregations of duties, untimely depositing of receipts, inadequate accounting of bad checks filed, inaccurate bank reconciliations, no accounting for liabilities, and untimely processing of bad checks.

• Numerous inaccuracies were noted in the county’s budget documents for 2000 and 1999.  As a result, numerous adjustments were made to the financial statements presented in this audit report.  In addition, actual disbursements exceeded budgeted amounts for several county funds.   

• The county does not have procedures in place to track federal awards for preparation of the schedule of federal awards.  The information presented by the County Clerk contained numerous errors and omissions.  Without an accurate schedule, federal financial activity may not be audited and reported in accordance with federal audit requirements which could result in future reductions of federal funds.

• The County Collector does not reconcile his cash balance to existing liabilities.  There was $10,389 of undistributed taxes and unidentified monies in his bank account.  In addition, the County Collector retains fees for non-sufficient fund checks and fees for duplicate tax statements to purchase office supplies.  State law requires every county official who receives fees for official services to pay such monies monthly to the county treasury.

• The county did not maintain documentation to support not selecting the lowest bid for several purchases, including dispatching equipment with a bid approximately $17,900 lower than the bid selected.  The County Commission indicated the decision was based on the vendors references and past experience with the vendor.  In addition, the county health center did not accept the lowest bid for employee health insurance.

• 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 Webster county’s Associate County Commissioners salaries were each increased approximately $7,060 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 each of the Associate County Commissioners, totaling approximately $14,120, for the two years ended December 31, 2000, should be repaid.  

• At March 31, 2001, the county had accumulated more than $8,600 in the Children’s Trust Fund and had only disbursed $2,000 of these funds to a domestic violence shelter since 1997. 

• Prior audits have recommended that the Health Center solicit proposals to refinance a $550,000 lease purchase agreement that has been costing the Health Center 10 percent interest since 1995.  Not until August, 2001 did the Health Center negotiate the interest rate which is now down to 8 percent.

• Numerous deficiencies were identified in the Associate Circuit Division’s records and procedures.  The Associate Division does not deposit receipts timely, reconcile bank accounts, properly segregate accounting duties, properly account for liabilities, and more.

Also included in the audit are recommendations to improve the accounting  controls and procedures for the Emergency 911 Board, County Health Center, County Clerk, County Collector, and County Sheriff.  The audit also suggested improvements be made in the county’s expenditure procedures, property tax system and personnel policies.  Several of these issues had been noted in prior audits.

Complete Audit Report