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Auditor cannot find proof of reimbursement to village of Arkport for personal use of credit cards, cell phones

Posted December 17, 2007 10:00 pm

Jen Carpenter

So where is the proof?

During a special meeting Monday afternoon Arkport village officials listened to a presentation from auditor Kelly Fitzpatrick of Wheat and Fitzpatrick and learned that Fitzpatrick was unable to find proof that personal charges made to village credit cards and cell phones were reimbursed, and that unused sick and vacation time paid to employees was approved by the board.

The analysis of a period from June 2006 to May 2007 is considered a preliminary finding, with a final report in the works. Fitzpatrick noted she has not made any determination on how to look at the credit card, cell phone and employee compensation issues.

"Because of these issues, because of the fact that I wasn't able to obtain what we call reasonable assurance, that's the reason why I have not figured out exactly what opinion I can give you," Fitzpatrick said.

Arkport Mayor A.J. Patti asked Fitzpatrick to give a general outlook of the audit.

"You'll hate this answer," she said. "When I find certain items, such as the items that I noted, I would hesitate to say that there are no other small nickel-and-dime dollar amounts."

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Fitzpatrick said she found employees were paid for accrued sick and vacation time, but there is no documentation the issue was discussed or approved during a regular board meeting. She said she has alerted village attorney about the issue.

Fitzpatrick said three employees were paid for the time without a local law. Bob Mauro, Department of Public Works superintendent, one of the employees who was compensated for unused time, said he was present at the meeting when everything was approved.

Resident Sue Thompson asked if it's reasonable for an employee to receive more than 60 weeks of sick and vacation time, referring to village Clerk Margaret Horan.

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"Is it more than what you normally see? Yes," Fitzpatrick said.

Horan said Thompson was basing her figures on a 9 a.m. to 1 p.m. workday, when she works full-time.

"I'm tired of the twist," Horan said. "The facts need to get out there and they're going to."

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Horan said more information will be discussed at Thursday's board meeting. She said residents are welcome to come to the office and "get the facts." She said a Tribune reporter "came in and got the facts," but said the Tribune editor would only allow what he wanted, "and that's why the truth didn't get printed."

Fitzpatrick suggested the village not have charge cards anymore.

"I inspected these charges, particularly the Sam's Club and Wal-Mart card, very closely," she said. "I did find documentation that indicated these purchases were made for personal use, and I could not obtain reasonable assurance that all the purchases were reimbursed back to the village."

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Trustee Jerry Clark noted the fire department has gas cards. Fitzpatrick said the bill stated the cards were office cards.

"Under the circumstances, I don't want to assume anything," she said.

Fitzpatrick said the village could look into sharing cards with other municipalities. She said village employees also have access to the general fund through a debit card, and when she asked for it, the card was not in its secure place.

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Angela Caldwell, Arkport resident and Hornellsville town board member, asked if credit cards were used to purchase items for parties held at the village, which Fitzpatrick confirmed. Following the meeting, Caldwell said taxpayer funds should not be used for parties, unless on very rare occasions.

"That's an absolute no-no," she said.

Fitzpatrick said she found the village had issued 10 cell phones, and three were to non-village employees. She said she couldn't ensure the bills had been reimbursed. Fitzpatrick said the village can still have cell phones, but they should only be issued to employees with a strict policy.

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Trustee Marianne Matacale asked if this meant the village was charged for items before they were reimbursed. Fitzpatrick said she could see the invoice, and see the bill being paid, but couldn't tell for sure whether or not the charges were reimbursed. She said the purchases were coded as being village expenses.

"That is very common procedure," she said.

Matacale asked if there were overage or late charges on any bills. Fitzpatrick said there were late fees on credit cards, and some may have been credited back. She said there were no late fees on cell phone bills, but the bills were not paid on a monthly basis.

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"A lot of these issues we already knew about," she said.

It was asked if these were simple mistakes, or if there was an indication of criminal activity.

"It's not appropriate for me to say one way or the other," Fitzpatrick said.

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Thompson asked why the board can't use policies and procedures developed under previous administrations. Patti said the procedures were too vague.

"Where are they?" Horan asked.

Fitzpatrick said because there are only two people working in the clerk's office, a "segregation of duties" is nearly impossible. She said the board should take a more active role in the village's bookkeeping to account for this.

On the positive side, Fitzpatrick said, Horan and Gambino were cooperative. She said records were produced back to the 1970s.

"Everything I asked for I was given," she said.

Fitzpatrick said in every audit report there are always certain amounts of fraud or other activity possible.

"We didn't really find anything that wasn't in line with typical municipal accounting," she said.

Matacale asked if Summerfest could be covered under the village. Fitzpatrick said there is a possibility it could be covered under the "trust and agency fund," but she would refer the matter to the village attorney. Patti said there is a possibility Summerfest could be covered under a community organization.

Patti said he wants a copy of the audit to be sent to the state Comptroller's office. He said he is comfortable with how the village runs, outside of instituting policies and procedures.

"I'm perfectly content myself with what you've done," he said. "I'm content with the outcome."

Patti said he hopes the audit puts any issues to rest.

"We have some issues, there's no doubt about it," he said. "That should be the end of it."

It was asked if copies of the audit report will be made available to the public. Fitzpatrick said the report handed to the board during the meeting was only for officials, and suggested full paper copies be given instead of uploading the report online.

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