In an audit that raised questions regarding spending practices under the former sheriff, auditors also pointed out issues detected with other county offices.
One of the findings in the audit report, released by the Tennessee Comptroller’s Office this week, is an ongoing issue with the Circuit Court Clerk’s Office, where auditors noted records “did not adequately reflect the financial activity of the office.”
Part of the problem, according to the report, is inadequate computer software.
No funds are missing from the Clerk’s Office, County Finance Director Ingrid Deloach said. The funds referenced in the audit, she said, are excess “undesignated” funds that cannot be reconciled with the record books.
The problem was created by accounting and recording practices used in the past at the Clerk’s Office, Deloach said, and changes have been made in the office to reduce the problem.
“I would dare say it is a 20-year-old problem that is now coming to a head,” she said.
The problem has been noted in previous audits, and for that reason, the auditor’s report notes that Carter County “has a material recurring audit finding.”
In his response to the audit, Circuit Court Clerk Johnny Blankenship said his department is working to correct the issue.
“Circuit and General Sessions Courts are continuing to make improvements and decrease the balance shown from the 2013 to 2014 audit,” Blankenship said. “Working closely with the software vendor, state auditors and the Audit Committee, plus outside resources, Circuit and General Sessions Courts will continue to resolve any issues, and we will continue to strive for improvements. Our goals have remained the same; to continue to move forward and become stronger in all accounting policies, practices and procedures.”
Deloach said Blankenship, who took office Sept. 1, already has made progress in correcting the recurring issue. Another accounting practice cited by the report is the way the county handled funding for the Parks and Recreation Board.
During the 2013-14 fiscal year, the county treated Parks and Rec as an “outside agency,” which means the county remitted funds directly to the agency to disburse rather than treating it as a county agency whose funds are disbursed through the Finance Department by the County Commission.
The report recommended the county reclaim those funds from Park and Rec and begin treating the board like a county agency and handling all funds through the Finance Department.
The funds have been returned to the county, Deloach said, and the County Commission will approve a budget for the board, which then will be handled by her office. Auditor’s also noted a deficiency within the school system’s federal projects fund. The deficit occurred because purchase orders had not been obtained for some expenses which were dated at the end of the 2013-14 fiscal year but were submitted to the Finance Office after the end of the fiscal year. In the future, Deloach said, no expenses will be reimbursed unless a purchase order was requested prior to the end of the fiscal year.
Software used by the landfill was also found to be inadequate by auditors, and Deloach said the county is already in the process of replacing the software with a program that meets the auditor’s requirements.
A theft at the landfill also resulted in a finding by the auditors because the state requires a Fraud Reporting Form be submitted whenever a theft occurs.
“It wasn’t a misappropriation of funds or missing funds,” Deloach said.
In that theft, which occurred in Sept. 2013, the office at the landfill was burglarized and a safe was stolen from the building. The safe contained keys, six vehicle titles, an external hard drive, deposits and cash. The county’s response to the finding said a surveillance system was in place at the landfill when the theft occurred but the perpetrator disconnected power from the building to disable the system.
“Proper procedure was followed in reporting the incident to the local authorities and the Comptroller’s Office,” the county’s response said, adding that additional safety measures have been implemented to help prevent future thefts.
The auditor’s findings regarding purchasing made by former-sheriff Chris Mathes were the largest issue documented by auditors in the report, Deloach said.
The report said Mathes made nearly $76,000 in expenditures which did not follow county purchasing statutues. The noted expenditures were part of an agreement between Mathes and Tennessee Business Enterprises, the operator of the Carter County Jail’s commissary program.
As part of the agreement, the TBE manager made donations to the Sheriff’s Department for the purchase of equipment and other items. The donations were kept in a separate account controlled by the manager and when Mathes requested items be purchased the manager would write a check for the purchase.