YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2005-52

IMPORTANT:  The Missouri State Auditor is required by state law to conduct audits once every 4 years in counties, like Dade, that do not have a county auditor.  In addition to a financial and compliance audit of various county operating funds, the State Auditor's statutory audit covers additional areas of county operations, as well as the elected county officials, as required by Missouri's Constitution.

This audit of Dade 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 health center’s administration repeatedly ignored warnings and recommendations to improve controls and cut costs.  As a result, the health center’s financial condition has continued to decline over the past several years.  At December 31, 2004, the health center had a negative cash balance of $33,052, while also having past due payroll taxes payable of $58,753.  Inadequate controls and procedures which contributed to the poor financial condition of the health center include the following:  the board did not receive a detailed monthly financial report, various accounting records of the health center were inaccurate, a budget was not prepared for the years ending December 31, 2004, 2003, 2002, and 2001 and expenditures were approved in excess of available monies.  Additionally, monthly bank reconciliations were not always prepared.

• The Health Center board did not monitor the compensatory time accrued by its employees and many of the compensatory hours claimed and paid to the former Public Relations Officer appeared questionable.  An adequate review of health center employees' timesheets, leave records, and payroll reports was apparently not performed.  The health center did not file 941 Employer's Quarterly Federal Tax Return forms and remit taxes due to the IRS in a timely manner, and did not remit employee retirement withholdings in a timely manner.  The board approved mileage reimbursements to the former Administrator without obtaining supporting documentation.  The general capital asset records were not complete, and the board exchanged health center furniture for office furniture            owned by the former Public Relations Officer.  The Health Center board needs to improve compliance with the Sunshine Law.

• The board and Director of the 911 Emergency Service Center have not adequately planned for future operations.  An adequate formal analysis of anticipated revenues and expenditures had not been performed, and the board had not prepared formal budgets for the years ended December 31, 2004, 2003, or 2002.  In addition, bank reconciliations were not performed monthly.

• The 911 board prepaid lease payments for services to be received over the next five years, and bids were not solicited or advertised by the board in all applicable circumstances.  Also, the 911 Board allowed the Director and Deputy Director the use of ATM/debit cards for a petty cash bank account without adequate review of the expenditures, and adequate documentation was not retained to support some cash withdrawals.  An adequate vehicle log was not maintained for the Director's vehicle, and procedures had not been established to ensure any personal mileage was reported to the IRS.  Inadequate payroll procedures resulted in untimely remittance of payroll taxes and filing of quarterly payroll tax returns, and incorrect withholding for employee taxes. 

• The County and various boards did not prepare budgets for various county funds, which resulted in significant omissions of receipts and disbursements from the county's financial statements.  In addition, the county's annual published financial statements did not include the financial activity of the 911 Emergency Services Fund, Health Center Fund, and several other county funds.

• Various problems related to county expenditures, including the lack of bidding documentation and written agreements, and an inadequate review of some expenditures and supporting documentation. 

• The county has not established procedures to sufficiently reduce its property tax revenues for sales tax monies received and as a result, $44,419 of excess property taxes has been collected.

The audit also included recommendations related to county officials' compensation, financial records and budgetary practices, property tax and personnel procedures, collateral securities, and general fixed assets.  The audit also suggested improvements in the procedures of the Sheriff, Prosecuting Attorney, County Clerk, Public Administrator, Recorder of Deeds, and the County Assessor.

Complete Audit Report