Trouble in new audit

DUNKIRK — Numerous deficiencies in accounting and record-keeping procedures continue to plague the office of clerk-treasurer Jane Kesler, according to two lengthy, detailed reports from the Indiana State Board of Accounts.
A 46-page Annual Financial Report for 2008 for the city of Dunkirk and a 16-page Audit Examination Report for the city, covering the year 2009, were filed this month.
Both contain a number of recommendations for changes and improvements. Dunkirk Mayor Ron Hunt said he plans to discuss those with Kesler.
Kesler, who is completing her third full term as clerk-treasurer, said she does not plan to run for re-election next year. She and the mayor have been at odds on several occasions in the past.
Some of the problems cited in the 2009 and 2008 reports had been pointed out in previous Indiana State Board of Accounts audits but still have not been corrected.
One concerns overpayments in a pension account to a retired police officer totaling more than $8,000 and dating back to 2005.
While overpayments are no longer being made, the auditors point out that the city has never been reimbursed for the $8,422 in overpayments. The retiree is still receiving his pension checks, and the amount of the pension has been corrected.
Other points noted in the 2009 audit include:
•As stated in prior reports, bank account fund balances were not always reconciled.
•Numerous posting errors were found. “These errors included amounts being posted to the wrong fund and receipts not being posted at all,” the audit report states.
•In numerous instances, receipts were deposited later than the next business day.
•As noted in prior audit reports, balances in payroll sub-accounts do not accurately reflect net payroll withholdings balances at year-end. “Errors have occurred in both posting receipts and disbursements to the accounts for several years with no corrections having been made,” the audit report states.
•As pointed out in previous audits, controls over receiving and posting collections and reconciling the bank account were insufficient. “The city office is staffed by two individuals, the clerk-treasurer and deputy clerk-treasurer. The deputy-clerk treasurer bills utility customers, receives customer payments, posts payments and adjustments to customer accounts, receives and posts park and police department collections and performs the monthly bank reconcilements. The duties of receiving and posting collections should be separated from the duty of reconciling the bank account balances to the record cash balances. The city council should review printouts of all adjustments made to customer accounts,” the auditors said.
•Two funds were overdrawn by amounts totaling $3,500 and $1,300. “Routinely overdrawn funds could be an indicator of serious financial problems which should be investigated by the governmental unit (which in this case is the Dunkirk City Council),” the audit report points out.
•As stated in previous audits, deposit reconciliations presented for examination did not always accurately reconcile with bank account balances.
The bank reconcilement for Dec. 31, 2009, included cash necessary to balance of $3,000.
Also the bank reconcilement included an amount of more than $330,000 listed as investments. Of this figure, less than $185,000 could be documented. “The unit (city) did not maintain an investment ledger and no documentation of the remaining $147,175 was presented for examination,” the auditors said, pointing out that state policies call for local investment officers to reconcile public fund balances at least once a month.
•Delinquent wastewater fees and penalties were not being recorded with the county recorder, nor were they certified to the county auditor which would result in liens being placed against delinquent properties. Consequently, appropriate liens were not being placed against properties.[[In-content Ad]]