New York State Comptroller Thomas P. DiNapoli has released a series of audits examining the financial and operational practices of several local governments and school districts across the state.
According to the audits, one county’s investments were found to be generally legal, safe, and liquid. However, officials did not establish or manage a comprehensive investment program. The audit noted that officials failed to monitor investments adequately, did not formally seek interest rate quotes, and overlooked other legally permissible investment options. Written procedures for a comprehensive investment program were absent, as were monthly cash flow forecasts or other monitoring methods to estimate available funds for investment. As a result, most available funds—averaging $112 million monthly—were kept in a money market account earning $1.8 million at an institution with lower rates than others available. The audit stated: “Had officials managed a comprehensive investment program, solicited interest rate quotes and deposited funds into a bank account or an investment option already used by the county, officials may have realized additional earnings ranging from $5.1 to $10.6 million.”
In another municipality, auditors found that the supervisor did not keep complete or accurate accounting records and reports. This left the board without reliable information needed to manage finances effectively. The supervisor also failed to identify and resolve discrepancies between recorded cash balances and adjusted bank balances due in part to inaccurate bank reconciliations. As of December 31, 2023, three bank accounts totaling $105,091 were omitted from records while three others had adjusted balances exceeding recorded cash by $513,735. Auditors identified about $440,000 in recordkeeping errors contributing to these differences.
A school district was cited for failing to properly record and account for all capital assets. Without designating a property control manager or segregating asset inventory duties among employees—and lacking oversight—the district increased its risk of loss or misuse of assets. Of 96 purchased assets reviewed during the audit period (from 30 purchases), 78 items worth $419,538 (87%) were missing from inventory lists.
The board overseeing certain projects was found not to have properly approved or monitored those receiving financial assistance. It did not adopt uniform criteria by resolution for evaluating projects nor prepare written cost-benefit analyses (CBAs) as required by law for each category of project considered for assistance. For nine approved projects reviewed in the audit: “Of the nine approved projects reviewed, a written CBA was not prepared for four of the projects, and the CBAs prepared for the other five projects did not include all the information required by law.” This left boards unable to fully assess community benefits before approval.
Another town’s supervisor also failed to maintain complete accounting records and reports; this led to unreliable information being provided—or sometimes withheld—from board members responsible for financial oversight during the audit period. The board itself neither audited nor contracted an independent accountant to review these records in 2023.
A separate audit reported that one board did not properly plan or manage its department building capital project: it lacked both a multiyear capital plan and adherence to a capital project budget. Consequently, approximately $243,500 was spent on property and goods/services that may remain unused—including land bought over five years ago that remains undeveloped without formal plans—and payment made two years ago for wall blocks yet undelivered with an outstanding balance owed upon delivery ($37,000). The board also improperly established a $1 million reserve fund; despite being notified by their attorney in October 2023 about this error regarding establishment procedures under state law they took no corrective action.
Finally, auditors found district officials did not comply with state law or Department of Health regulations regarding lead exposure reduction in potable water outlets at schools: “Auditors determined 178 of the 665 (27%) water outlets identified were not sampled or properly exempted by district officials.” There was no sampling plan covering all outlets nor remedial action plans specifying which outlets were exempted or how they would be secured against use—nor details on planned remediation actions—which meant auditors could not confirm whether all necessary remediation occurred due to lack of data on untested outlets’ lead levels.
