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Audit results released for county clerk's office

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Carney responds to comments from state auditor’s office

By Zac Oakes

Kentucky State Auditor Mike Harmon released the results of his audit of Taylor County Clerk Mark Carney’s office last week.

According to the results of the audit, auditing standards require the auditor’s letter to communicate whether the financial statement “presents fairly the receipts, disbursements, and excess fees of the Taylor County Clerk in accordance with accounting principles generally accepted in the United States of America.”

The clerk’s financial statement did not follow this format according to the report, but the financial statement was fairly presented in conformity with the regulatory basis of accounting, which is an acceptable reporting methodology, according to the report.

The audit process requires that the auditor comment on noncompliance issues, as well as material weaknesses involving internal control over financial operations and reporting.

Harmon left five comments for Carney in the audit.

The first comment states, “The Taylor County Clerk’s Office lacks adequate segregation of duties over receipts and disbursements.”

This was a comment that the State Auditor’s office made in a separate audit of the Taylor County Clerk’s Office that was released in January of this year.

The auditor’s comments note that this condition “is a result of a limited budget, which restricts the number of employees the county clerk can hire or delegate duties to.”

The state auditor’s office recommended the county clerk strengthen internal controls by segregating duties, and if it is not possible due to a limited staff, “strong oversight should be implemented.”

Carney issued a response to the auditor’s office in which he states that he feels confident in the cross-training in the office.

“This just seems to be a comment that never goes away,” Carney wrote. “I feel pretty good about the cross training we are doing in the office and we attempt to document the different reports/tasks that we are required to do.”

The segregation of duties has been commented on in several audits in previous years.

The second comment from the auditor’s office states, “The Taylor County Clerk did not deposit all funds collected intact daily.”

The report states that daily checkout sheets show each day’s cash on hand is different, rather than a set amount for the cash drawer each day.

Additionally, the report notes that the county clerk leaves the daily cash receipts overnight in the office vault and makes the deposit the next day.

The auditor commented that if a fire were to occur due to electrical wiring in the vault, the wooden cabinet would be destroyed, along with all monies contained within.

“We choose not to count drawers down to an exact amount each afternoon and deposit all remaining monies,” Carney said in his response. “To do this would mean that we deposited all funds that were taken in that day, however to do this would also mean that we were depositing dollar bills, quarters, dimes, nickels and pennies. I make a business decision to not deposit our coins and then turn around and go to the bank and get change to be able to operate that day. We will continue to deposit all big bills ($100, $50 and $20) that we receive each day and occasionally deposit $10 and $5 bills, but for the most part will keep each of those for change as we operate the next day. The POS system tracks the amount in each drawer. POS makes the closing procedures real easy and quick when used as we use it now.”

Other comments from the auditor’s office include comments about personnel policies and sick leave, as well as employee timesheets,

The full audit can be found online for public viewing through Kentucky Auditor Mike Harmon’s website or through the following link: http://bit.ly/2AdsGfj

The Kentucky State Auditor’s office conducts annual audits of county fiscal courts, county sheriff’s offices, and county clerks, among others.