Report No. 2008-97
December 2008
Complete Audit Report
The following findings were included in our audit report on the City of St. Louis Office of Treasurer.
The Treasurer's Office is comprised of the Treasury Division and the Parking Division. At March 10, 2008, city funds held by the Treasurer's Office totaled approximately $41 million in bank accounts and $292 million in various investments.
The Treasury Division does not adequately document the competitive procurement of services for the deposit of city funds. Banks and accounts utilized by the Treasury Division have not changed in recent years. The financial advisor indicated he sends questionnaires to potential new depositaries seeking information about rates and community involvement. The Treasurer should solicit formal bids or proposals for banking services.
The Treasury Division has not resolved old reconciling items in its accounts. The Dormant Account contains old unidentified monies from other bank accounts that were closed ten or more years ago totaling about $350,000, and the Payroll Account contains about 420 outstanding checks from 1 to 8 years old totaling approximately $170,000. The Treasury Division has not attempted to contact the payees and reissue the checks. In addition, the Treasury Division does not always promptly prepare bank reconciliations and does not maintain adequate documentation to support investment decisions.
The procedures of the Treasury Division for posting electronic deposits to the daily ledger and contacting other departments about unremitted Receipt Coding Forms or adjustments related to those electronic deposits are not sufficient to ensure timely posting of those receipts. For example, monies from the parking bond trustee electronically deposited in September, October, and November 2007, totaling $728,767, were shown as reconciling items and not recorded on the daily ledgers until January 2008. While the Treasurer's Office has identified the reconciling items, failure to post such items timely to the daily ledgers results in inaccurate cash balances on the city's accounting records.
During the eighteen months ended December 31, 2007, average monthly receipts of cash and checks by the Treasury Division totaled approximately $36 million. While procedures appear adequate to ensure monies recorded on the daily ledger are deposited, procedures could be further strengthened to provide more assurance that all monies collected are recorded on the accounting records and deposited.
The Treasurer's Office did not maintain adequate documentation to support payments to financial advisors and one financial advisor received payments exceeding the contract amount. The Parking Division used two financial advisors to assist with the 2006 and 2007 revenue bond issuances and for other financial advisory services. The advisors received payments from the bond proceeds totaling about $267,000 and payments from the Parking Fund totaling about $74,000 during the eighteen months ended December 31, 2007. The Treasurer's Office did not execute written agreements for the services paid from the bond proceeds. In addition, the Parking Division made payments to the other advisor from the Parking Fund for ongoing financial advisory services based upon invoices that were not detailed. Further, as of May 2008, the Treasurer's Office had not installed a new automated payroll/personnel system that it acquired and paid $37,000 for in December 2007, and some of the warranties had already expired.
The Treasurer's Office does not have a formal procurement policy. Costs were incurred during the eighteen months ended December 31, 2007, for some professional services without soliciting competitive bids/proposals, including legal services of $205,000, financial advisory services of $341,000, investment management services of $463,000, feasibility studies of $87,000, and engineering services of $77,000. Additionally, the Treasurer's Office did not execute formal written contracts for these legal services, engineering services, and feasibility study services as required by state law.
The Parking Division had not ensured a developer complied with contract terms regarding invoices, documentation, and payment for the Euclid/Buckingham garage under construction. As of December 31, 2007, the Treasurer's Office had paid the developer $3 million of the $4 million contract for construction; however, billings and payments to-date significantly exceeded the actual construction progress.
The Treasurer's Office does not adequately verify the monthly billings of the contractor responsible for processing parking tickets and the contract was amended in March 2005 to provide additional bonuses to the contractor while requiring no increased services. Payments to the contractor during the eighteen months ended December 31, 2007, totaled about $2.7 million.
The Parking Division has not analyzed and compared parking meter costs and related revenues. The Parking Division could increase its efficiencies by eliminating the meters for which costs exceed revenues or reduce its costs related to those meters by reducing the servicing, replacement, or frequency of collections from those meters.
The Treasurer's Office has not established policies addressing related employees, enforced employee leave policies, or maintained leave balances accurately.
Vehicle usage/maintenance logs are not complete and the review of fuel usage is not adequately documented.
Complete Audit Report
Missouri State Auditor's Office
moaudit@auditor.mo.gov
