Report No. 2010-58
May 2010
Complete Audit Report

Findings in the audit of the City of Levasy

Water System
Non-monetary transactions are not reviewed by the Board. The City Clerk posts non-monetary transactions to water accounts, as well as receives water payments. There is no oversight of non-monetary transactions or other changes to the accounting system to ensure these transactions are properly authorized. The city has not conducted a formal rate study in over 6 years and has not prepared a formal capital improvement plan. Additionally, the city does not have sufficient procedures to ensure monies received from bulk water sales are reasonable.

Budgets and Financial Reporting
While budgets are prepared and adopted, they do not contain all elements required by state law. The budgets did not contain a budget message and are prepared for each bank account, rather than by fund. The beginning and estimated ending cash balances were not included in the budgets for each account. In addition, the city has not submitted annual financial reports to the State Auditor's office for the years ended December 31, 2005 through December 31, 2007, and has not published semi-annual financial statements, as required by state law.

Ordinances
The city does not maintain a summary list of ordinances passed, rescinded, or superseded by a subsequent ordinance. As a result, it is not clear which city ordinances are currently in effect. Numerous city ordinances are not signed and some appear old and outdated. In addition, some newly adopted ordinances have not been added to the ordinance book and previous versions are not formally rescinded.

Accounting Controls and Procedures
Proper segregation of duties is not possible because the only office worker is the City Clerk, and there is minimal supervisory review of her work. The city does not issue receipt slips for all monies received or retain other source documentation for water receipts, such as payment stubs.

Disbursements
Supporting documentation related to some credit card disbursements was insufficiently detailed. Transfers made to the payroll account were not supported by adequate documentation and the amounts transferred exceed the amount necessary to make payroll.

Sunshine Law
The city did not always demonstrate compliance with the Sunshine Law. Information provided in the October 26, 2009, closed session minutes was not sufficient to demonstrate that issues discussed were allowable under the Sunshine Law. In addition, the city did not retain copies of meeting notices held in 2009.

Elected Officials
The city has not established adequate procedures to ensure all candidates for the position of alderman are qualified to run for office.

Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov