A lack of internal control and lack of a division of financial duties were the only “material weaknesses” pointed out by state auditors in their annual report on the county’s financial statements.
State Auditor Adam Edelen, through his report for Pulaski County for the 2010-2011 fiscal year (ending on June 30, 2011), said Pulaski County Fiscal Court needs to strengthen its internal controls to ensure the county’s finances are being overseen and reconciled correctly.
“Lack of segregation of duties could result in misappropriation of assets and/or inaccurate financial reporting to external agencies such as the Department of Local Government (DLG), which could occur but go undetected,” Edelen stated in the report. “In addition, too much control by one individual without oversight can lead to irregularities that go undetected.”
Pulaski County Treasurer Joan Isaacs, who took over in August of this year after longtime county treasurer Arlene Young retired, said the comment was a result of a change in standards by Edelen’s office.
“It requires a different type of segregation of duties,” Isaacs said. “We weren’t doing that because we weren’t aware of that at the time.”
Isaacs said the county treasurer has performed a number of duties through the years. Those duties include preparing and depositing receipts, posting transactions into the county’s accounting system, preparing reports for submission to the DLG, and performing bank reconciliations for all county funds.
What Edelen’s office would like to see now, she said, is a system in which “as many hands as possible” touch those financial transactions and statements to ensure everything is being done correctly.
Edelen, in his report, recommended that the county “divide the responsibilities for receipts and bank reconciliations among the treasurer, the finance officer, and other employees of the county in order to achieve an appropriate level of segregation of duties.”