July 23, 2014 at 2:10 p.m.
Report details missing money (01/12/06)
Redkey Town Council
By By ROBERT BANSER-
REDKEY — Former town clerk-treasurer Brenda Adkins misappropriated more than $32,000 in utility collections during 2003 and 2004, an Indiana State Board of Accounts audit asserts.
Adkins, who resigned late last year, reimbursed the town in December, paying nearly $40,000 to cover the misappropriated funds, along with $3,189.89 in unnecessary finance charges incurred by the town and $4,284 to cover the cost of state audits.
The state audit alleges Adkins diverted $32,061.99 from utility payments for her personal use while she was in office.
Redkey’s current clerk-treasurer Sandy Kirby said that State Board of Accounts representatives requested these extra auditing fees, and if Adkins was not able to pay them, then the town would have been assessed the $4,284.
Kirby was appointed by local Democratic Party leaders to replace Adkins, who resigned on Oct. 27. Her resignation came during the time period when state auditors were visiting Redkey and conducting the 2003-2004 audit. After serving more than 16 years as the town’s clerk-treasurer, Adkins submitted a two-sentence letter of resignation on a Thursday afternoon.
State Board of Accounts regional director Bill Vinson said Wednesday a copy of the audit report has been forwarded to the Jay County prosecutor’s office.
“We’ve disclosed all that we could find in the report itself,” Vinson said, noting that further action would be up to the prosecutor’s office. The Redkey audit report should be in the mail, if it has not arrived at the prosecutor’s office already, Vinson said.
He added that the Redkey audit took a little longer than normal to complete. Vinson said that Adkins did attend an exit conference on Dec. 13 where auditors described the results of their findings. Vincent said the former clerk-treasurer “cooperated” with the auditors, being helpful in several ways.
“In essence, she (Adkins) took responsibility,” Vinson said.
Asked more specifically about what the term “personal use” meant in relation to Adkins and the alleged misappropriation of the more than $32,000 in utility collection money, Vinson said, “Personal use is a stock term which means the money ended up in her pockets instead of the town’s.”
Attempts to reach Adkins for a comment Wednesday and today proved unsuccessful.
Jay County Prosecutor Brad Burkett was in court and unavailable for a comment this morning.
Redkey town attorney John Brooke, who had raised concerns about the town’s finances in 2005, was also unavailable this morning.
After reviewing the audit report, Redkey Town Council president Violet Erlenbush said today, “I don’t know what I could say. I think we should put it behind us and move forward.
“It’s just very sad.
“Hopefully, we can correct all of our downfalls and move forward,” commented Erlenbush, who has known and worked with Adkins for a long time.
State auditors found numerous other problems with Redkey’s bookkeeping, pointing out:
• “The cash balances of the local road and street fund and wastewater utility funds were overdrawn in 2003 and 2004.”
• The detailed customer deposit register did not reconcile with the customer deposit amounts, recorded on the general ledger.
• “The town has an ordinance concerning the application of water meter deposits to outstanding utility balances. However, there were 112 accounts identified where customers had moved owing balances and the meter deposits were not applied to this balance.”
• As noted in prior audits and during the current audit period, receipts were deposited later than the next business day. Of the receipts tested, 92 percent were deposited later than the next business day. Some receipts were held as long as 12 business days.
• A review of claims paid during this audit period revealed 53 paid two to three months after the invoice date, 20 claims paid from three to four months after the invoice date, 12 claims paid from four to six months after the invoice date, and 11 claims paid more than six months after the invoice date.
• The town was not in compliance with Internal Revenue Service directives by not having W-4 forms on file for all employees.
• As noted in six prior audit reports, delinquent wastewater fees and penalties had not been recorded with the county recorder nor were they certified to the county auditor which would result in a lien against the property. Delinquent account balances ranged from one to 156 months in arrears.
Last year at the urging of the Redkey Town Council, Brooke made several attempts to get Adkins to more fully explain the status of Redkey’s financial situation. He sent her a detailed list of questions, most of which she never answered to Brooke’s or the town council’s satisfaction.
In a letter to Adkins last summer, Brooke said, “The town board members are needing this information so that they can make decisions as to the financial future of Redkey. Most of this information was required to be provided to the town board members pursuant to the State Board of Accounts Audit (for 2001-2002). The town board members relayed to me that they have yet to receive monthly financial reports as specified in (the previous) State Board of Accounts audit.”
In a separate exit conference on Dec. 14, 2005, State Board of Accounts auditors reviewed the findings for the 2003-2004 audit with Redkey town council members and the newly appointed clerk-treasurer Kirby who said she just received the final audit report in the mail on Wednesday.
The two checks from Adkins totaling $39,535.88 were received on Dec. 14 — $4,284, and Dec. 20 — $35,251.88, the final audit report document states.
In a brief letter to town officials in the audit report, State Board of Accounts representatives explained, “No financial transactions are reflected in this report because records were not in the proper condition or not available to audit. However, we did examine available records to the extent possible for compliance with state statutes.”[[In-content Ad]]In the list of results and comments included with the Indiana State Board of Accounts Audit Report about Redkey for the two years beginning Jan. 1, 2003, and ending Dec. 31, 2004, state officials found:
• “Brenda K. Adkins, former clerk-treasurer, from the information presented for audit, failed to deposit $32,061.99 in utility collections received by her by misappropriating these funds for personal use.”
• As pointed out in the previous audit report for the period of 2001-2002, and during the subsequent audit period, the town had to pay finance charges on past-due bills. These charges totaled $3,189.89 during 2003, 2004 and 2005. Following the state auditors’ exit conference late last year with Adkins, the former clerk-treasurer paid the latter amount back to the town.
• “A review of claims paid during the audit period revealed 53 claims paid two to three months after the invoice date, 20 claims paid from three to four months after the invoice date, 12 claims paid from four to six months after the invoice date, and 11 claims paid in excess of six months after the invoice date.”
• Some of the town’s records “were not in the proper condition or not available to audit.” In these cases the auditors examined available records “to the extent possible.”
• The bond for the clerk-treasurer, a requirement of state statutes, was not filed in the office of the Jay County recorder.
Adkins, who resigned late last year, reimbursed the town in December, paying nearly $40,000 to cover the misappropriated funds, along with $3,189.89 in unnecessary finance charges incurred by the town and $4,284 to cover the cost of state audits.
The state audit alleges Adkins diverted $32,061.99 from utility payments for her personal use while she was in office.
Redkey’s current clerk-treasurer Sandy Kirby said that State Board of Accounts representatives requested these extra auditing fees, and if Adkins was not able to pay them, then the town would have been assessed the $4,284.
Kirby was appointed by local Democratic Party leaders to replace Adkins, who resigned on Oct. 27. Her resignation came during the time period when state auditors were visiting Redkey and conducting the 2003-2004 audit. After serving more than 16 years as the town’s clerk-treasurer, Adkins submitted a two-sentence letter of resignation on a Thursday afternoon.
State Board of Accounts regional director Bill Vinson said Wednesday a copy of the audit report has been forwarded to the Jay County prosecutor’s office.
“We’ve disclosed all that we could find in the report itself,” Vinson said, noting that further action would be up to the prosecutor’s office. The Redkey audit report should be in the mail, if it has not arrived at the prosecutor’s office already, Vinson said.
He added that the Redkey audit took a little longer than normal to complete. Vinson said that Adkins did attend an exit conference on Dec. 13 where auditors described the results of their findings. Vincent said the former clerk-treasurer “cooperated” with the auditors, being helpful in several ways.
“In essence, she (Adkins) took responsibility,” Vinson said.
Asked more specifically about what the term “personal use” meant in relation to Adkins and the alleged misappropriation of the more than $32,000 in utility collection money, Vinson said, “Personal use is a stock term which means the money ended up in her pockets instead of the town’s.”
Attempts to reach Adkins for a comment Wednesday and today proved unsuccessful.
Jay County Prosecutor Brad Burkett was in court and unavailable for a comment this morning.
Redkey town attorney John Brooke, who had raised concerns about the town’s finances in 2005, was also unavailable this morning.
After reviewing the audit report, Redkey Town Council president Violet Erlenbush said today, “I don’t know what I could say. I think we should put it behind us and move forward.
“It’s just very sad.
“Hopefully, we can correct all of our downfalls and move forward,” commented Erlenbush, who has known and worked with Adkins for a long time.
State auditors found numerous other problems with Redkey’s bookkeeping, pointing out:
• “The cash balances of the local road and street fund and wastewater utility funds were overdrawn in 2003 and 2004.”
• The detailed customer deposit register did not reconcile with the customer deposit amounts, recorded on the general ledger.
• “The town has an ordinance concerning the application of water meter deposits to outstanding utility balances. However, there were 112 accounts identified where customers had moved owing balances and the meter deposits were not applied to this balance.”
• As noted in prior audits and during the current audit period, receipts were deposited later than the next business day. Of the receipts tested, 92 percent were deposited later than the next business day. Some receipts were held as long as 12 business days.
• A review of claims paid during this audit period revealed 53 paid two to three months after the invoice date, 20 claims paid from three to four months after the invoice date, 12 claims paid from four to six months after the invoice date, and 11 claims paid more than six months after the invoice date.
• The town was not in compliance with Internal Revenue Service directives by not having W-4 forms on file for all employees.
• As noted in six prior audit reports, delinquent wastewater fees and penalties had not been recorded with the county recorder nor were they certified to the county auditor which would result in a lien against the property. Delinquent account balances ranged from one to 156 months in arrears.
Last year at the urging of the Redkey Town Council, Brooke made several attempts to get Adkins to more fully explain the status of Redkey’s financial situation. He sent her a detailed list of questions, most of which she never answered to Brooke’s or the town council’s satisfaction.
In a letter to Adkins last summer, Brooke said, “The town board members are needing this information so that they can make decisions as to the financial future of Redkey. Most of this information was required to be provided to the town board members pursuant to the State Board of Accounts Audit (for 2001-2002). The town board members relayed to me that they have yet to receive monthly financial reports as specified in (the previous) State Board of Accounts audit.”
In a separate exit conference on Dec. 14, 2005, State Board of Accounts auditors reviewed the findings for the 2003-2004 audit with Redkey town council members and the newly appointed clerk-treasurer Kirby who said she just received the final audit report in the mail on Wednesday.
The two checks from Adkins totaling $39,535.88 were received on Dec. 14 — $4,284, and Dec. 20 — $35,251.88, the final audit report document states.
In a brief letter to town officials in the audit report, State Board of Accounts representatives explained, “No financial transactions are reflected in this report because records were not in the proper condition or not available to audit. However, we did examine available records to the extent possible for compliance with state statutes.”[[In-content Ad]]In the list of results and comments included with the Indiana State Board of Accounts Audit Report about Redkey for the two years beginning Jan. 1, 2003, and ending Dec. 31, 2004, state officials found:
• “Brenda K. Adkins, former clerk-treasurer, from the information presented for audit, failed to deposit $32,061.99 in utility collections received by her by misappropriating these funds for personal use.”
• As pointed out in the previous audit report for the period of 2001-2002, and during the subsequent audit period, the town had to pay finance charges on past-due bills. These charges totaled $3,189.89 during 2003, 2004 and 2005. Following the state auditors’ exit conference late last year with Adkins, the former clerk-treasurer paid the latter amount back to the town.
• “A review of claims paid during the audit period revealed 53 claims paid two to three months after the invoice date, 20 claims paid from three to four months after the invoice date, 12 claims paid from four to six months after the invoice date, and 11 claims paid in excess of six months after the invoice date.”
• Some of the town’s records “were not in the proper condition or not available to audit.” In these cases the auditors examined available records “to the extent possible.”
• The bond for the clerk-treasurer, a requirement of state statutes, was not filed in the office of the Jay County recorder.
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