YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

September 30, 2003

Report No. 2003-101

IMPORTANT:  The Missouri State Auditor is required by Missouri law to conduct audits only once every four years in counties, like Ripley, which do not have a county auditor.  However, to assist such counties in meeting federal audit requirements, the State Auditor will also provide 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 it 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 Ripley 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 Ripley County hospital was not tracking the balance of a $2 million liability to the Internal Revenue Service for payroll taxes.  The Hospital Administrator was reimbursed for his personal tax refunds that were applied to a penalty assessed by the IRS.  The hospital had no documentation to support the payments nor did they have a complete understanding of the penalties and their relationship to the liability.  In addition, the Hospital Administrator paid himself $1,000 for reimbursement of medical expenses, however, there was no documentation of board approval.  Further, numerous payroll advances were paid to hospital employees which appear to violate Article VI, Section 23 of the Missouri Constitution.  Several thousand dollars of these had been outstanding for some time.
   
• Improvements are needed with the property tax system controls and procedures.  In addition, the County Clerk does not prepare the current or back tax books or maintain an account book with the County Collector and controls over property tax additions and abatements are not adequate. 
   
• Documentation was not maintained by the county to support situations in which the low bid was not accepted, and sole source procurement was not always documented by the county for various expenditures.  Vehicle logs and equipment maintenance logs are not maintained for some vehicles and equipment in the Road and Bridge Department. 
   

• In late December of both 2002 and 2001, the County Commission amended various county budgets to reflect increased expenditures for the year.  Prior to the amendment of these budgets, expenditures had already exceeded the original budget. 
   

• Numerous problems were noted relating to both the current and former Prosecuting Attorneys' accounting controls and procedures.  Weaknesses included inadequate segregation of accounting duties and controls over receipts, the failure to make deposits timely and intact, and not remitting bad check fees to the County Treasurer monthly.  Additionally monthly bank reconciliations were not prepared, liabilities were not reconciled to cash balances and there was no follow up on old outstanding checks. 

Also included in the audit were recommendations related to the hospital's budgetary practices and published financial statements, the county's federal awards, personnel policies and procedures, and general fixed assets.  The audit also suggested improvements in the procedures of the Sheriff, County Collector, Circuit Clerk, Associate Circuit Court, Health Center, Senior Citizen Services Board, and the Senate Bill 40 Board. 

Complete Audit Report