YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

The original construction contract for street, water, and sewer improvements on the Liberty Lane project totaled $310,000, although the city incurred additional construction expenditures of approximately $294,000 for change orders.  Board minutes indicate $223,000 of the change orders involved additional construction for water main improvements, however the city did not solicit bids for the additional construction included in the change orders.  In addition, the city did not adequately document the planned and actual sources and uses of funding for the Liberty Lane project.  Also, the city did not document that the actual expenditures from each fund represented appropriate uses of the restricted revenues of the applicable funds.

In July 1998, the city purchased land for $150,000 located near the current city hall; however, this land has not been used by the city.  City officials indicated the city intended to build a new city hall and city library on this land; however, no formal plans were prepared for such a project.  The city did not obtain an appraisal prior to the purchase of the land.

The city makes payments to the City Administrator which appear to be taxable compensation but are not reported on his W-2 forms.  Since July 2001, he has received a monthly vehicle allowance of $400 but is not required to report any expenses incurred on behalf of the city.  In addition, the city has no documentation to show that this allowance amount is reasonable, as the employment contract does not adequately define which expenses are covered in this allowance.

The city's current payroll procedures do not ensure that payroll expenses are allocated to the proper funds.  Each employee's salary is paid from one fund regardless of how each employee's duties and functions overlap the various city services.  It is essential the city properly allocate employee salaries to the various funds.

The city's budget for the year ending April 30, 2003 was not passed by ordinance, signed by the board, or retained with board meeting minutes.  Therefore, it is unclear what budget documents were approved by the board.  In addition, the city's budgets did not adequately project the revenues and expenditures of some funds, document some interfund transfers, nor reflect accurate prior years' revenues.

The city did not publish some semi-annual financial statements as required by state law.  Financial statements that were published did not include detailed sources or categories for receipts and expenditures.  In addition, the city had not submitted annual financial statements to the State Auditor's Office, as required by state law, since the year ended April 30, 1999.

Also included in the audit are recommendations related to procurement procedures, meeting minutes, and ordinances.

Complete Audit Report