YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2006-19

April 2006

IMPORTANT:  The Missouri State Auditor is required by state law to conduct audits once every 4 years in counties, like Randolph, that do not have a county auditor.  In addition to a financial 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 Randolph 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’s General Revenue Fund is in poor financial condition.  The fund has ended each year since 1997 with a negative cash balance, which has grown to approximately ($776,000) at December 31, 2005.  Fund disbursements have exceeded receipts during all but two of the last nine years.  During this time period significant increases were experienced in several disbursement categories including salaries, employee fringe benefits, Sheriff’s department, and Jail operations.

The county’s budget preparation and financial data monitoring activities have not  resulted in effective management tools for controlling county disbursements.  In addition to overspending the General Revenue Fund budget by approximately $209,000 during 2004, various other county budgets were overspent during 2003 and 2004.

The County Commission has not adequately addressed the long term financial viability of the General Revenue Fund.  Upon expiration of the voter approved earmarked 1/2 cent sales tax in 2020, the entire burden of funding the operational costs of the justice center will revert back to the General Revenue fund.  Long term solutions for alternative funding sources and/or disbursement reductions need to be considered.

• The county did not always solicit bids and/or retain adequate bid documentation for various purchases.  Contracts were not always entered into as needed and some contractual arrangements did not provide adequate details.  In addition, some expenditures were approved without sufficient documentation or evidence of receipt of goods or services, and the allocation of some costs was not clearly documented.

• The county and health department do not have adequate procedures in place to track federal awards for the preparation of the SEFA.  For the years ended December 31, 2004 and 2003, the county under-reported approximately $164,000 and the health department under-reported approximately $57,000, respectively, in federal grant monies.

• The county’s capital asset records and physical inventory procedures are not adequate, and vehicle usage logs are not required for some county vehicles.

• The County Clerk does not prepare or verify the current and back tax books or maintain an account book with the County Collector.  Neither the County Clerk nor the County Commission verify the County Collector’s annual settlements or adequately review property tax additions and abatements.

• Access to computer data and programs in the County Clerk’s, County Treasurer’s, and County Assessor’s offices is not adequately restricted.  In addition, the County Treasurer does not perform periodic data backups. 

• The health department improperly calculated the percentages used for allocating overhead costs to one federal grant program and allocated administrative costs to another  federal grant program using a higher percentage rate than allowed by the grant award.

Also included in the report are recommendations related to personnel policies and procedures.  The audit also suggested improvements in the procedures of the County Clerk, Prosecuting Attorney, and Sheriff.

Complete Audit Report