The Arkansas Legislative Audit has finished the audit of 2015 for Dermott Ark. Posted below is the information in the audit. More from the audit is on the next page also includes attached images.
- The following improper disbursements, totaling $25,166, were noted during review of selected expenditures:
- $1,852 in improper travel reimbursement including travel expenses without a documented business purpose ($1,768), excess reimbursement ($57), and meal reimbursement with no overnight stay ($27).
- $1,330 in expenses from the Dermott Community Festival, in appearent conflict with Ark. Const. art. 12, § 5, as interpreted by Op. Att’y Gen. no 1992-099.
- $14,481 in payments to vendors and $7,503 in reimbursements to employees without supporting documentation; therefore, the validity of these disbursements could not be determined.
2. During the period of January 1 through September 30, 2016, restricted cash totaling $17,453 was transfered from the Street Fund. To the Payroll Fund for non-street related salaries/wages.
In addition, the city made the following transfers of restricted cash, totaling $348,814, for which documentation was not provided:
- $201,471 from the Special Sales Tax Fund to the Street Fund. These monies were restricted for street/water capital improvements, had been collected over a 24-month period through a one-half percent sales tax and deposited in a separate account , which was closed in February 2016.
- $127,365 from the Nursing Home Capital Improvement Fund. These monies, which were restricted for nursing home capital improvements, had been collected over a 24-month period through a one-half percent sales tax and deposited in a separate account, which was closed in June 2016.
- $19,978 from the Street Fund to the General Fund
3. In performing procedures for the 2015 engagement, the following items were noted for 2016
- Monthly bank reconciliations and cash receipts and disbursements journals were not prepared, in noncompliance with Ark. Code Ann. §§ 14-59-108, -110, -111.
- Financial statements were not provided to the City Council members on a monthly basis, in noncompliance with Ark. Code Ann. § 14-59-115. This precludes management from making appropriate, informed decisions on behalf of the City.
- In October 2016, the city sold land and building to the American Legion for $1 in apparent conflict with Ark. Const. art. 12, § 5.
- Wage rates again were neither reflected in the minuets nor the budget.
- The city exceeded appropriated expenditures in the General Fund by $143,511, in noncompliance with Ark. Code Ann. § 14-58-203.
Invoices and supporting documentation again were not always retained, in noncompliance with Ark. Code Ann. § 14-59-105.
District Court Clerk
- District Court City, County, and Civil bank reconciliations did not agree with the book balances, in noncompliance with Ark. Code. Ann § 16-10-209. A similar finding was issued in the prior report.
- Receipts were not deposited daily, did not include the method of payment, and the deposit slips did not contain the receipt numbers, in noncompliance with Ark. Code Ann. § 16-10-209. A similar find was issued in the prior report.
- The balance in the City bank account again was not identified with receipts issued for cases not yet adjudicated and the payments made on all unpaid time payment accounts, as required by Ark. Code Ann. § 16-10-209. The unidentified amount was $22,781.
The following information system weakness was discovered during a review of computers:
Clerk/District Court Clerk/Police Chief
There was no formally documented and approved Disaster Recovery or Business Continuity Plan. This situation could cause the entity to be without computer processing for an extended period of time in the event of a disaster or major interruption and could have severe impact on critical resources and affect essential services placing undue financial and personnel burdens on the resources of the entity.
District Court Clerk
There was no wireless security and use policy. Failure to establish and communicate an adequate wireless security and use policy could result in the unnecessary exposure or misuse of information resources.