An audit of Edgar Springs, located in
the Phelps County, found numerous problems with the city's accounting controls
and procedures, as well as other operations of city government. State Auditor Nicole Galloway conducted the audit at the request of
residents who submitted a petition to her office. The report gave a rating of
"poor."
"Our
audit of Edgar Springs found several significant concerns, including incomplete
budgets and inaccurate financial statements," Auditor Galloway said.
"These are serious issues that impact transparency for citizens on how
their taxpayer dollars are used. City officials need to address and implement
the recommendations in the audit in order to get on the right track."
The
audit found city officials did not prepare complete annual budgets as required
by state law or monitor budgets appropriately. City officials also did not
prepare and maintain accurate financial statements and accounting records,
resulting in errors on monthly financial statements. In addition, city
officials did not publish complete and accurate financial statements or file
accurate and timely financial reports with the State Auditor's Office, as
required by state law.
The
audit also found several concerns with accounting controls and procedures in
the operation of the city's sewer system, including how rates are determined
and how deposits, adjustments and delinquent accounts are handled. The city
also needs to segregate accounting duties and improve receipting and depositing
procedures to safeguard monies collected, and to improve procedures over
disbursements.
In
addition, the audit found the city does not have a bidding policy to ensure
taxpayers get the best deal for services. For example, the city did not solicit
bids or document the process for selecting a vendor that completed street and
building repairs funded through federal grants and totaling more than $37,000.
The
audit also found city officials did not always comply with the Sunshine Law. In
March, after city hall was closed to the public due to COVID-19, the
former Mayor directed
the city clerk to only process and bill sewer payments. In June, the former
Mayor resigned and the city clerk resumed responding to records requests.
The
complete audit can be found here.
