by Kristina Gabalski
Officials in the Town of Hamlin say they have corrected all financial discrepancies identified in a recent state audit of Financial Oversight and Information Technology conducted by the Office of the New York State Comptroller.
“An audit is a tool to help make improvements,” Hamlin Supervisor Tom Breslawski says. “I would welcome another.”
During their regular meeting August 12, members of the Hamlin Town Board accepted the corrections by resolution.
According to the audit’s Executive Summary, the objective of the audit was to determine, “if the Board and Supervisor provided adequate oversight over Town financial operations, accounting functions and information technology to properly account for and safeguard Town assets for the period of January 1, 2010 to August 9, 2012.
The audit found that the board did not provide necessary guidance to the supervisor and employees, and did not establish internal controls that ensured the town’s financial activity was accurately recorded and reported.
“The Board did not ensure that the supervisor assigned accounting duties to properly trained personnel or that those duties were adequately segregated and performed. As a result, significant accounting deficiencies occurred and the board did not have reliable information on which to base management decisions. In addition, the board did not annually audit the records and reports of the supervisor, or other departments which received or disbursed moneys on the town’s behalf, as required. Further, the board did not audit all claims before they were paid, and had not established adequate controls over credit card use, which increased the risk that town moneys could have been spent for inappropriate purposes,” the audit’s Executive Summary states.
Furthermore, the audit found Hamlin’s accounting records and resultant financial reports were in considerable disarray and that the Supervisor did not review the bank reconciliations prepared by the bookkeeper for completeness and accuracy.
The report noted that until January 2012, Board members, “generally only reviewed the abstract of claims and rarely reviewed the individual claims and supporting documentation before approving them for payment.”
Supervisor Breslawski says that when he took office in January of 2012, he discussed this practice with the Comptroller’s Office and took immediate corrective action.
“Since taking office, I instituted a policy of asking (Hamlin Town) Board members to review each and every bill, each month, before asking for approval of payment,” he explains.
Supervisor Breslawski adds that all five board members now audit bills each month.
The corrections accepted by the Board via resolution on August 12 are the result of the audit finding that, “the bookkeeper incorrectly reported nearly every cash account on the Town’s AUD (Annual Update Document),” Supervisor Breslawski says.
He says the former bookkeeper is no longer employed by the town. Breslawski notes that all financials from 2012 are now recorded correctly and all cash is reconciled and he credits new bookkeeper, Shari Hill, with efforts to correct the errors of the past and implement new policies and procedures.
“The recording errors have been corrected – all of them,” Breslawski says. “I am proud of where we are at. The new bookkeeper has worked really hard. Our independent accountant has worked really hard. These changes are to safeguard the taxpayers’ funds. The end result is something that residents of Hamlin can be proud of.”
The audit noted that the general fund balance sheet printed from the financial accounting system, for the year ended December 31, 2011, included an asset account – due from other funds, “with a negative balance of $909,665. An asset account with a negative balance would be highly unusual and should prompt immediate investigation by management,” the audit states.
Supervisor Breslawski says those funds are not gone or missing, “they were incorrectly booked into the financial system,” he says.
The overall fund balance was previously misreported, Supervisor Breslawski adds, and in fact, “Hamlin had an additional $486,506, which is now accounted for correctly. After all corrections were made, the town had an operating gain of $316,655 for 2012.”
The audit makes 17 recommendations for the Town, and Supervisor Breslawski says 16 of those 17 have been addressed and corrected. The only task remaining is the completion of a disaster recovery plan under the Information Technology portion of the audit. Supervisor Breslawski says the town is working on the plan and will include related expenses in the upcoming budget.
According to the Comptroller’s Office, the audit findings were, “very similar to findings” of an audit conducted in 2002, which were not corrected until recently, Supervisor Breslawski explains.
“The Town now has the financial controls, checks and balances in place that were lacking for years,” he says.
He adds that the state auditors have been, “great to work with,” and that he continues to be in contact with them to “ensure all revenue is being booked the way it is supposed to be.”
