NYS Comptroller's Report -- Savannah Fire District

8/2/2019 NYS Comptroller's Report -- Savannah Fire District

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THOMAS P. DiNAPOLI

COMPTROLLER STATE OF NEW YORKOFFICE OF THE STATE COMPTROLLER

110 STATE STREETALBANY, NEW YORK 12236

STE

DEPUDIVISION O

AND SCHOTel: (518) 474

March 23, 2012

Mr. Tom Grabbatin, ChairmanMembers of the Board of Fire Commissioners

Savannah Fire DistrictP.O. Box 1781770 NYS Route 89 NSavannah, New York 13146

Report Number: 2011M-267

Dear Mr. Grabbatin and Members of the Board of Fire Commissioners:

One of the Office of the State Comptrollers primary objectives is to identify areagovernment officials can improve their operations and provide guidance and servassist them in making those improvements. Our goals are to develop and promote slong-term strategies to enable and encourage local government officials to reduce cservice delivery and account for and protect their entitys assets.

In accordance with these goals, we conducted an audit of the Savannah Fire Dist

which addressed the following question:

Are District controls adequate to ensure that financial activity is properly that District moneys are safeguarded?

We discussed the findings and recommendations with District officials and concomments in preparing this report. The Districts response is attached to this reporA. District officials agreed with our recommendations and indicated they plann

corrective action.

Background and Methodology

The Savannah Fire District is a district corporation of the State, distinct and sepaTown of Savannah in Wayne County. The Districts general fund budget totaled $2011 fiscal year


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Board minutes. We conducted this performance audit in accordance with genergovernment auditing standards. Those standards require that we plan and perform

obtain sufficient, appropriate evidence to provide a reasonable basis for our conclusions based on our audit objective. We believe that the evidence obtainereasonable basis for our findings and conclusions based on our audit objective.

Audit Results

The Board is responsible for overseeing the Districts fiscal activities and safresources. To fulfill this duty, it is essential that the Board establish a system of inte

which consists of policies and procedures that ensure transactions are authorizedrecorded; that financial reports are accurate, reliable, and filed in a timely mannerDistrict complies with applicable laws, rules and regulations.

The Treasurer must maintain complete, accurate and timely records to account Districts financial activities properly. The Treasurer should prepare and submit moto the Board and is required to prepare and submit an annual financial report of financial condition to the Office of the State Comptroller (OSC) within 60 days afte

the fiscal year. This report is an important fiscal tool, which provides the Board witnecessary to monitor District operations. The Board is responsible for performinaudit of claims before they are paid to ensure that District funds are used for legitexpenditures.

The General Municipal Law (GML) authorizes fire districts to maintain certain rincluding capital reserve funds.1 With respect to capital reserve funds, the Gspecific requirements regarding the establishment, funding, administration and use

funds. The Board must ensure that it complies with the statutory referendum requireto the establishment of capital reserve funds and use of moneys in those funds. Thshould ensure that the financing of capital reserve funds is appropriately transparenby including appropriations specific to each reserve fund in the annual budget.

The Board did not establish policies or procedures to guide the Districts managestablishment, use and recordkeeping requirements of reserve funds.2 The Distcapital reserve fund (reserve), which was established prior to 1989, and had a balan

as of December 31, 2010. District officials were unable to provide us with resoludocumentation as to the reserve funds purpose or the exact date this reserve waDepending on the date of establishment and purpose of this reserve fund, differapply for public participation in the establishment of and expenditures made from it


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finances this reserve fund with a budgetary appropriation each year4

and also remaining general fund balance to the reserve fund at the end of each year. The Dmade expenditures from the reserve fund since its equipment purchases in 2009.

We found that the Board generally provides adequate oversight of District financWe found that vouchers were properly signed by the Board and resolutions aupayment of bills were documented in the minutes. The Board also conducts an athe Treasurers financial records. The Board was unable to provide us with adopted

and investment6 policies, and a code of ethics,7 as required by the GML. The Boaradopted written procedures concerning financial recording and reporting. We fTreasurer submitted detailed monthly financial reports to the Board, but did not filannual financial reports timely with the Office of the State Comptroller for 2009 aTreasurer resolved an accounting error and filed the 2009 report in May 2010. She report in September 2011, upon realizing that the report had not been properelectronically when she completed it.

Due to the lack of written policies and procedures, we reviewed 22 check disbursemover $15,000, and all bank account transfers totaling over $75,000, made within ouGenerally, we found that the financial activity was properly supported and dappeared to be for legitimate District purposes.

Recommendations

1. The Board should adopt reserve fund, procurement and investment policies, ethics, and should ensure that formal written financial procedures are establi

2. The Board should research the origin of the existing capital reserve. If it that there is no evidence that the existing capital reserve was established in with statutory requirements, the Board should take steps to ratify and legalifund by following the procedures for establishing a capital reserve fund in

with the General Municipal Law.

The Board has the responsibility to initiate corrective action. Pursuant to SectionTown Law, a written corrective action plan (CAP) that addresses the recommendations in this report must be prepared within 90 days of receipt of thforwarded to our Office. To the extent practicable, implementation of the CAP mus


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to our brochure, Responding to an OSC Audit Report, which you received with treport. The Board should make the CAP available for public review in the Secretary

Sincerely,

Steven J. HancoxDeputy ComptrollerDivision of Local Government

and School Accountability


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APPENDIX A

RESPONSE OF LOCAL OFFICALS

The local officials response to this audit can be found on the following page


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Documents

NYS Comptroller's Report -- Savannah Fire District