County Audit Finds Few Discrepancies

Nashville, TN (2011-03-25) The annual review of the county books by the State Comptroller’s Office found only one significant discrepancy in its accounting records in 2010, marking the fewest findings in recent years. The state has recommended the creation of an local audit committee.

According to an audit report released on Friday by the Division of County Audit of the State Comptroller’s Office, Scott County had only one significant finding in the 2010 report, a perpetual error from an earlier audit of the records of the General Sessions Court. According to audit report, the trial balance of the execution docket of the General Sessions Court prepared on June 30, 2010 did not reconcile with general ledger accounts, a difference of $185,836. After carefully examining documents, auditors identified $170,312 in errors, leaving an unidentified balance of $15,524. The clerk of record reportedly made the adjustments identified in the audit. The deficiency, stated the report, could be attributed to the failure of management to correct the finding noted in the 2009 audit report. Since the finding, the clerk of record has reportedly fixed the computer error.

The only other finding in the 2010 audit was familiar to county officials, as once again auditors noted the lack of segregation of duties among the employees of the offices of the County Clerk, Circuit and General Sessions Courts Clerk, Clerk and Master, Register of Deeds and Sheriff. In the finding, auditors noted a lack of separation of duties amongst employees created a lack of internal controls that increased the risk of unauthorized transactions within the office.

As result of findings that have span more than one audit period, the State Comptroller’s Office has pressed for the establishment of a local audit committee. Last fall, the Comptroller’s Office began adding language to its audit reports that strongly encouraged local governing bodies to create an audit committee to review findings and monitor office holders’ plans to address them, especially those that have been noted in previous audit reports.

Per state statute, an audit committee must consist of at least three persons, which can include members of the County Commission, citizens of the County, or a combination of both. Elected officials, other than Commissioners, their spouses or immediate family members may not serve on the committee. While not required, state officials encourage county’s to be selective in making appointments and encourage them to appoint persons to the committee that have a strong background in finance, business and accounting.