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County audit shows good balance sheet

Feb 8, 2012 By Martin Reed Staff Writer

Fremont County government's audit for the last fiscal year showed assets exceeding liabilities by $130 million, but total revenues for the period took a 14 percent dive.

The audit report presented to county commissioners Jan. 24 stated revenues for governmental activities decreased $4.5 million from the previous year, falling to $26.1 million from $30.6 million.

The revenue decreases included property taxes dropping $2.9 million, or 27 percent, because of lower natural gas prices, according to the audit for the year starting July 1, 2010.

Sales and use taxes fell by $1.4 million, or 23 percent, and investment earnings declined $700,000 "due to loss in investment value," according to the report.

The county's revenue derived from the federal payment in lieu of taxes, known as PILT, increased to $2.13 million from $1.85 million in the previous year.

Expenses up

At the same time, expenses for the county government activities increased by $1.4 million, or 5.2 percent.

The general fund -- the primary coffer for day-to-day operational functions of county government -- sustained similar declines with revenues dropping by $2.3 million to $20.4 million total.

Likewise, property taxes decreased $2.8 million, or 29 percent, again because of falling natural gas prices. But the fund recorded increases from intergovernmental revenue, PILT funding and other sources.

General fund expenditures saw a slight overall uptick by $200,000 to $22.2 million, according to the audit.

Overall, the county government had $27.8 million in revenue compared to $30.7 million in expenses, according to the report.

Ongoing concerns about expenditures exceeding revenues raised comments during the meeting.

"If we're spending more than we're bringing in, we have to address that," commissioner Dennis Christensen said.

On the upside, deputy county treasurer Jim Massman noted an important part of the government's fiscal picture. "Fremont County is in an enviable position," he said. "We don't have any debt."

Auditor concerns

Auditing firm DeCoria, Maichel & Teague, P.S., of Spokane, Wash., included several concerns with various financial aspects of county government in the report.

In one case, the auditing firm identified concerns with signers on bank accounts left in place after the individuals have left their respective organizations. In each of the cases with the fair office and the recreation department, improvements happened to correct the issues.

Concerning the Weed and Pest District, the auditors pointed out the agency did not prepare year-end statements in compliance with federal regulations. Weed and Pest will enlist services of a qualified accountant for its upcoming report for the year ending June 30, according to the report.

The auditors cited concerns with cash handling among the county's various component units.

"The concentration of closely related duties and responsibilities by a small staff makes it difficult to establish an adequate system of automatic internal checks on the accuracy and reliability of the accounting records," according to the report.

To correct the concern, the various agencies in question will implement systems that include: allowing the bookkeeper to record all liabilities and prepare checks; getting someone else to mail or deliver checks; and having someone other than the bookkeeper do the bank reconciliation.

Fiscal procedures

Although not included in the audit report, the firm provided other notes about the county's fiscal operations.

Concerns continued over the fair's collection of admission to the annual event. Patrons buy tickets and in turn receive a wristband, but the fair at the time did not reconcile the number of each distributed, according to the management letter accompanying the audit.

"This would allow someone to be able to obtain the wristband for entrance to the fair without providing a ticket. As a result the controls are eliminated when the tickets and wristbands are not reconciled," according to the letter.

The commission heard that concerns with the fair have been addressed.

DeCoria, Maichel & Teague manager Warren Erickson told commissioners and others during the meeting the audit is "qualified," rather than unqualified, because of ongoing questions about closure costs related to the county's landfills.

"Normally we issue an unqualified opinion," Erickson said about the audit.

In the audit report, the firm states: "We were unable to obtain sufficient audit evidence related to management's estimate of the closure and postclosure care liability of the Fremont County Solid Waste Disposal District" claimed at $6 million as of June 30, 2011.

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