YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

Report No. 2006-81
December 2006

IMPORTANT:  The Missouri State Auditor is required by state law to conduct audits once every 4 years in counties, like Adair, 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.

Adair County is required by federal regulations to prepare a Schedule of Expenditures of Federal Awards each year.  The county does not have adequate procedures in place to track federal awards for the preparation of the schedule.  This condition was noted in prior audit reports.

Several areas of concern were noted regarding policies and records at the Juvenile Division including no formal written policies on the proper use of vehicles, credit cards, cellular phones, and equipment.  In addition, improvements were needed in procedures over travel expenses, the bulk fuel tank, and receipt handling.  While the Juvenile Division had implemented many changes prior to the completion of the audit, with the lack of oversight and record keeping there is no assurance assets were not mishandled. 

Problems were noted regarding receipt and disbursement classifications in county budgets. Additional budget concerns included no budget for several smaller funds and actual disbursements exceeded budgeted amounts in several funds. 

Bid and other supporting documentation for disbursements was not always retained and the county had not entered into written agreements for some services. 

Concerns regarding the property tax system noted in our prior audit still existed.  The County Clerk does not verify the accuracy of the current and delinquent tax books as required by state statute.  In addition, the County Commission and County Clerk are not providing a review of the activities of the County Collector and some tax abatements were not approved by court order. 

Sheriff’s office procedures relating to processing of monies, unidentified monies, old outstanding checks, and contract monitoring were in need of improvement.  While some of these areas were repeated from the prior audit, the Sheriff has currently implemented all the recommendations made. 

The Recorder is not fully utilizing all capabilities of the county’s document recording and indexing system including the use of pre-numbered receipt slips and is not providing for

the timely archiving and off-site backup of system records.  Additional concerns were noted regarding copy monies and written contracts with abstract companies.  As indicated by the Recorder, there were three office holders during this four year term which contributed to some of the problems noted in the audit report. 

As noted in our prior audit report, the Health Center budget does not reasonably reflect the Health Center’s anticipated financial activity and cash balances and, therefore, lessens the effectiveness of the budget as a tool for monitoring and controlling Health Center disbursements.  The budgets significantly underestimated receipts by over $360,000 and overestimated disbursements by over $570,000 in 2005 causing the ending cash balance to be underestimated by approximately $940,000.

The Health Center paid the daughter of the Health Center Administrator $36,180 for the two years ended December 31, 2005, for Nurse Practitioner services.  While requests for proposals were not solicited or advertised by the Health Center for these services, the Health Center indicated they recently advertised and received no responses.  In addition,  the contract was signed only by the administrator.   There were other recommendations to the Health Center regarding the CDC grant, disbursement approvals, collateral securities, leave policies, and meal expenses. 

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