The first two citations are exactly the same as 2015 and 2014 citations which noted the County had not prepared internal control documentation nor did it have a formal fraud risk assessment in place.
For the third straight year, auditors with Daniel Jones & Associates Certified Public Accountants have cited the Camden County government with significant deficiencies related to internal controls and fraud risk prevention.
The latest independent audit analyzed financial documentation through Dec. 31, 2016. A copy was provided to the Lake Sun by Camden County Auditor Jimmy Laughlin’s office, who according to the report, has taken an active approach to addressing the issues that have also appeared in the 2014 and 2015 audits.
According to the summary of the audit results, significant deficiencies were cited in financial statements and federal awards. In total five deficiencies were uncovered and recommended to be changed.
Daniel Jones & Associates uses the generally accepted standards and government auditing standards, known as Statements of Auditing Standards: Clarification and Recodification to cite significant or material weaknesses and deficiencies.
The first two citations are exactly the same as 2015 and 2014 citations which noted the County had not prepared internal control documentation nor did it have a formal fraud risk assessment in place. The third citation appeared in the 2014 audit but not the 2015 audit, which states that “bank reconciliations were not prepared in a timely fashion by the Auditor’s Office general account.”
The cause is listed as “management does not place adequate emphasis upon reviewing cash transactions and preparing timely reconciliations.”
The fourth notice deals with bank reconciliations prepared for the Recorder’s, Sheriff’s and Jail Inmate’s accounts listed with the same cause.
Lastly, the fifth notice deals handling of federal award monies, citing internal controls documentation. The independent auditors noted that “not documenting internal controls over federal compliance requirements could result in the noncompliance of a major component of the federal program.”
The significant deficiency dealt with various federal award accounts including the Federal Grantor which had some form of internal control documentation, but was deemed not adequate by the auditors. There were no federal award findings in the 2015 audit, according to the report.
Laughlin, who was appointed to the vacant position by Gov. Eric Greitens in June after former County Auditor Ronnie Capps retired due to medical issues, has been tasked as the responsible official for planned correction actions.
Laughlin has already taken several steps to address the deficiencies which include preparing the needed conforming documentation for the internal control structure, acquiring antifraud policy templates for modification to conform with the new policy and submitting a memo to all departments requiring monthly reconciliation and bank information, according to the report.
“The new gubernatorial appointed Auditor (Jimmy Laughlin) is in the process of preparing the needed documentation to document their internal control structure in conformity with Uniform Guidance,” according to the audit. “While only having a partial year to work on this the new Auditor expects to have at least a portion of this done with completion within the next 18 months.”
Over the summer, Camden County was also approved to undergo a comprehensive state audit by State Auditor Nicole Galloway. It is scheduled to start this fall, though an exact date has yet to be announced.
The difference between a comprehensive performance audit, such as those conducted by the State of Missouri, and an independent financial audit lies in the details, scope and time.
With a First Class designation by the State of Missouri in 1997-1998, Camden County was no longer required to undergo regular state audits, but instead formed its own internal auditor’s office while contracting annually for a financial audit report conducted by an independent CPA firm.
From 2013 to 2016, Camden County has used Daniel Jones & Associates, CPAs, to conduct its independent financial audit and also tasked former special deputy auditor Michael Dorf, CPA, with reviewing the 2016 budget process.
Based on prior audits of First Class counties, Camden County may not get the results of the state audit for more than a year it is started. The county will likely be left with a bill somewhere between $100,000 and $150,000 when it’s completed.
The state audit will look more closely at whether or not county offices are abiding by Missouri State Statutes, including the Sunshine Law, and provide a detailed breakdown of cash flow, expenditures and revenue.