Mill tax records in line for external audit, contracted bookkeeping

A review of the books for Cape Girardeau County Mental Health Mill Tax Board continues.

On Dec. 22, Presiding Commissioner Gerald Jones sent a memo to the board, informing its members he has requested a verbal proposal from J. Baer and Associates to provide bookkeeping services for the mental health board at a cost of $150 per quarter.

The memo indicates the board's books will be audited at the end of each calendar year by "a different CPA firm or the county auditor" with the cost of an external audit estimated at between $1,200 and $1,500.

The memo comes on the heels of an initial review of the mental health board's financial records by county commission assistant Robb McClary. Mental health board treasurer Cindi Kramer, a four-year volunteer, resigned Nov. 17 and turned in all of the records for an audit. The mental health board grants $900,000 in county money each year to county mental health agencies.

In a Dec. 15 memo to the county commission, McClary set out several recommendations, though he wrote that his review of the records is incomplete.

He said the work he did does not constitute a full audit, which remains to be scheduled. He said state statutes requires annual audits for funds handled by county boards.

McClary compared the mill tax board records with county treasurer records and original bank statements to verify balances. The process Kramer used, he wrote in his report, did not meet the standards set by the Government Accounting Standards Board, though he did not suggest inappropriate handling of the money itself.

The Government Accounting Standards Board is a national independent agency aimed at setting standards for accounting and financial management for state and local governments.

"It is clear from the meeting minutes that the board spent considerable time and energy in evaluating and granting requests for funding of mental health services and should be commended for its volunteer service to the county," McClary wrote. "Additionally, the treasurer spent many hours managing the fund and keeping records and likewise should be commended for her efforts. While the record keeping could be improved, most transactions could be easily verified through the records presented."

One example he cited was that Kramer recorded incoming funds when they were received and deposited rather than when the were earned. Kramer said Sunday the county did not inform her of quarterly earnings.

McClary suggested the mental health board should hire a private accounting firm to review its books because, he wrote, "the board is unlikely to find from among its members someone who has the necessary financial background to serve as both treasurer and record keeper."

He suggested the mental health board adopt an annual budget, just as the county commission does each year, with bottom-line figures for revenue, expenses and grants. The treasurer should be required to present monthly financial reports detailing all expenses and balances from bank and investment accounts.

"Both president and treasurer should countersign all checks. Checks for July 2006 and March and April 2007 were signed by only one person. Blank checks should never be signed by either president or treasurer," McClary wrote.

He noted that the investment of bank certificates of deposit authorized Feb. 25 were done by withdrawal slip rather than by check, "thus leaving a difficult paper trail. Future investments should be done by check, countersigned by both president and treasurer."

Some changes were made after the last time county Auditor David Ludwig looked at the board's books, in 2005, McClary wrote. Kramer's records reflect monthly bank reconciliations and the board began requiring applicants for grants to show proofs that their books had been audited.

But the board failed to create a written procedure on how the treasurer should document money handling. Kramer was not bonded, a state requirement, though the board did get liability insurance for all its members.

Kramer said she'd asked to be bonded four years ago, but "I really don't remember why we didn't go ahead with that."

She said since resigning from the board treasurer job, she has felt much better, as she keeps busy doing books for her family's company and helping people do their income taxes.

pmcnichol@semissourian.com

388-3646