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Fiscal Court Special Called Meeting to Review the 2014-2015 Audit that was just released by State Auditor.

Fiscal Court Special Called Meeting to Review the 2014-2015 Audit that was just released by State Auditor.

Bill Stephens

May 17th, 2017


The Union County Fiscal Court meet for a special called meeting to review the 2014/2015 Audit that was just released by the State Auditor.
Judge Executive Jody Jenkins explained that Magistrates Gary Day and Joe Wells as well as himself and the County Attorney Brucie Moore had actually reviewed the Preliminary Audit in July 2015. The Audit itself did not become public till May 10 of this year. The main concern was the fact that the Audit had 15 instances of non compliance issues. Magistrate Joe Clements asked for the special called meeting so that the questions that the citizens of Union County have could be answered. In the meeting Jenkins went over each instance of Non compliance and then explained the reasoning that was giving to the state auditor and also he elaborated on some on the issues for better explanation.

The first non compliance item was lacks segregation of duties over cash receipts, disbursements, transactions for posting and bank reconciliations. County Treasurer Lissa Gibson explained that the $33,000 in the payroll’s revolving account was an overage in Insurance and that she had reentered and corrected the amount in July 2015. Gibson also explained that the investment journal not agreeing with the analysis of investments was also correct and reentered in July 2015. Judge Jenkins explained that the treasurer had deposited federal funds into the road account because a check from the road fund had been used to pay for a project. The road fund was used because the Grant money had not come in and the grant money was used to reimburse the road fund. Jenkins stated that this was a miscommunication and that from now all grant money would be put on their own line and all expenditures and income associated with grant money would be grouped together.

The next non compliance item was Internal Controls over disbursement and credit cards were weak. Jenkins said that all examples in the audit had been verified as correct. He also stated that there was always documentation but the Auditor did not want to wait for verification. Clements said that from now on all bills are not paid unless there is documentation and verification. He said that now two magistrates and the Jenkins go over every invoice and signoff before payment is made.

Proper purchasing procedure for small contracts and purchases was another non compliance issue. Jenkins acknowledged that now all purchases will be accompanied by three quotes. Even purchases as low as $50.

The non compliance issue that had worried most Union County Citizens was The Fiscal Court Failed to spend Coal Severance funds properly. In the Audit it was stated that a county must spend 30% of coal severance on the coal haul road system. Judge Jenkins observed that there was only one haul road in Union County and it was only a half mile long and it was almost impossible to spend 30% of 2.4 million dollars on the little road that is already blacktopped and well maintained.

The non compliance issue that raised the most questions for the people in attendance was That the Fiscal Court did not implement internal controls over payroll, properly compensate employees for overtime, and properly account for hours worked. Treasurer Gibson recounted that at the time of the audit all raises through the Union County Jail did not have to be approved by the fiscal court. The Auditor only looked at the minutes from fiscal court meetings to establish an employees pay rate and did not take in to account that they may have received a raise. Now all raises are approved and recorded in the meetings so that any auditor can see the pay rates for all employees. Also Gibson stated that at the time of the Audit they did not receive time cards for employees that were salary. Now all employees, no matter if they are salary or hourly, clock in and out of work on a digital time clock, and those time cards are approved by the employee and the department head. Magistrate Clements asked Treasurer Gibson about the 20 instances where the treasurer did not clock in, but was paid full salary without the use of leave time. Gibson explained that at that time she did not fill out a time card due to the fact that she was Salary. She went on to state that now she clocks in and out on a digital time card. Amy Morris questioned the FICA issues that were brought up in the Audit. Magistrate Joe Wells explained how the jail was at the time issuing raises and these raises were not recorded in the Fiscal Court Meetings and the Auditor did not realize that the pay rate for some on the employees was not correct.

Union County Jailer Shawn Elder accounted for the non compliance issues against the Union County Jail. It was pointed out that at the time of this Audit Elder was not the jailer and he could only explain everything he changed once he took over as Jailer. In the issue of segregation of duties over account functions Elder explained that now he and the jail bookkeeper divide the accounts of the jail between them. The bookkeeper makes the deposit and Jailer Elder takes the deposit to the bank and signs off on the deposit being correct. Also on the issue of not making daily deposits Elder declared that there were some days when there were not any deposits. He said at this time he and the bookkeeper just initial the date that there was not a deposit available. The Auditor did tell him that he is now in compliance with state regulations.

On the non compliance issue of the Fiscal Court failed to maintain controls over Capital Asset record maintenance. Judge Jenkins stated that they did fail to put a bridge on the Asset Sheet. He said that before Vernon Martin left the EMA position he did make a complete list of all County Assets.
Judge Jenkins explained that on the issue of the Fiscal Court lacking adequate control over the off-site receipt collections and deposit had been resolved. He said that Paul Monsour now goes daily to all off-site properties and picks up their deposits and deposits them in the bank and signs off on them.

The Fiscal Court failing to implement internal controls that are adequate to ensure the schedule of expenditures of federal awards is accurately prepared was a main topic of discussion because failure to comply with state laws could result in the loss of the federal funding. Jenkins stated that the County will request proposals from outside consultants and/or certified public accountants to monitor and review any pending or future state, local or federal grants. The County Finance officer will be the designated point person for all future and pending federal, state, and local grants. The Treasurer will be required to give written bi-weekly reports with explanations of any transactions involved with any federal, local, or state grants.

Magistrate Gary Day explained that the next two audits will be done by an independent Auditor that is approved by the state. The Auditor will then turn their findings into the state auditor.

Magistrate Joe Wells feels that the Fiscal Court did not do anything wrong and all the corrections were made pertaining to the audit.

Magistrate Joe Clements explained that it was a learning experience for all involved.

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