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State audit finds problem with bookkeeping procedure
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The first meeting of Warren County’s Audit Committee was held Thursday to review the audit findings from the state for the fiscal year ending June 30, 2014.
According to Steve Reeder in the Tennessee Division of Local Government Audit, five issues were found in Warren County and all but one has been corrected.
The finding not yet corrected is that the offices of County Clerk, Register of Deeds, and Sheriff are not spreading certain duties adequately. In each department, only one person oversees the financial bookkeeping.
“They have enough personnel,” said Audit Committee chairman Wayne Cantrell. “Why can’t they do something about that? They have multiple employees. In a very small office, it might not be feasible to have more than one person, but these aren’t small offices.”
Reeder says the finding is a “repeat one,” meaning the departments have been told in past audits that more than one person should be overseeing bookkeeping to prevent accounting errors or the possibility of misappropriated funds.
County Executive Herschel Wells offered to talk to the department heads to see if they could implement a change.
Reeder says it would be better if the committee meets with them.
“This committee is not set up to look over somebody’s shoulder and it’s not set up to run somebody’s office,” said Reeder. “At the same time, if you ask about the finding and that it’s been in there several times, simply asking can make a big difference.”
After years in the auditing business, Reeder says segregating bookkeeping duties is a regular finding in the offices of elected officials.
“We’ve seen this forever,” he said. “An office holder will have a finding. They will go through the process. Then, they will hunker down and wait. When nothing happens, they think ‘that’s not so bad’ and that’s how you get repeat findings.”
Having one person is fine, says Reeder, as long as a second person reviews the accounting
“The first thing people think of is fraud,” he said. “However, what we see more of is errors. Er-rors happen a lot more than fraud.”
The Comptroller of the Treasury released its finding Feb. 27. The four findings found that have already been addressed and corrected were:
• Office of Finance Director – the School Federal Projects Fund had a cash overdraft at June 30, 2014.
• Office of Trustee – the trustee paid checks issued on the School Federal Projects Fund that ex-ceeded available funds.
• Office of Circuit, General Sessions, and Juvenile Courts Clerk – the accounting software did not identify the user who processed transactions.
• Office of Clerk and Master – the clerk and master did not require a depository to adequately collateralize funds.
On the committee with Cantrell are Emily Horton, Danny Martin, and County Commissioners Randy England and Ken Martin. Danny and Ken Martin were absent.
A follow-up Audit Committee meeting will be scheduled and all the elected officials in the county invited to attend. That date and time has not been set.