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YELLOW SHEET Office of the State Auditor of Missouri |
Report No. 2004-50
June 21, 2004
The following problems were discovered as a result of an audit conducted by our office of the City of Cardwell, Missouri.
Some monies received were not deposited into the city's accounts. A comparison of three deposits in 2003 and 2002, showed that $136 more was received than deposited. These differences went undetected due to numerous internal control weaknesses, little or no independent review and a lack of adequate record keeping. A petty cash fund is not maintained on an imprest basis and documentation and controls over such monies was lacking. Additionally, periodic reconciliations of total billings, payments received, credit adjustments, and delinquent amounts are not performed for the water, sewer, trash, and mosquito spraying services.
In July 2003, the Board voted to increase the trash fee from $6.25 per home to $6.50 for homes within the city and to $8.00 for homes outside the city limits. The city contracts with a trash hauler to collect trash from the homes and pays the trash hauler $6 per home. The city did not prepare a formal cost study to document the need for the increase, or identify other costs related to trash service.
In 1998, a building and the surrounding property were donated to the city. The city did not immediately obtain a deed to the building and property donated to the city, and did not solicit bids, or obtain an appraisal prior to donating city property to an individual. Board minutes signed by the city officials and the individual indicated an agreement had been made but that additional information would be included in documents. Additionally, in 2002, the Mayor signed a deed transferring city property to the individual. Except for the minutes noted above, there was no documentation indicating the board had approved the transfer of this property. Litigation was initiated concerning this property and a settlement agreement has apparently been reached.
In December 2002, the city collector, chief of police, city clerk, water commissioner, and a police officer each received a payment of $100. The minutes indicate this was a "one time pay raise"; however, the officials monthly salary did not increase. These appear to be bonuses paid to these officials and employees. These bonuses appear to be one time pay raises and represent additional compensation for services previously rendered and are a violation of the Missouri Constitution and an Attorney General's opinion.
The city has not adequately documented the specific reasons for going into closed meetings. Additionally, improvement is needed in the organization of city ordinances.
The audit also includes some matters related to budgets and financial statements, expenditures, payroll, restricted revenues, fixed assets and the municipal division, which the city should consider and take appropriate corrective action.
