PORT LEYDEN A state audit recommends that the town of Lyonsdale improve its budgeting and fuel inventory management.
In order to maintain reasonable and stable fund balance levels, it is essential for Town officials to develop realistic budgets, said a report posted last week by the state comptrollers office.
The audit which examined town operations from January 2011 to Sept. 30, 2012, but also included some records dating back to January 2008 for additional trend analysis indicated that while most of the town reserve funds were adequate, the highway townwide fund balance declined from $88,293 at the beginning of 2008 to a deficit of $12,600 at the end of 2012.
That was primarily a result of unbudgeted expenses, auditors said, noting the towns 2010 and 2011 budgets did not contain an appropriation for principal and interest payments on an installment purchase contract that averaged about $42,000 each year.
Board members told us that, prior to 2012, the budget-to-actual reports provided to them each month by the former bookkeeper were often found to be inaccurate and did not contain current information, the report said.
Because of the deficit, money was transferred from the highway town-outside-village fund but apparently had not been repaid, it said.
In a review of 119 claims totaling $161,514, auditors also found 18 claims totaling $37,904 that contained some type of deficiency, including lack of supporting documentation. They also noted a potential conflict of interest in the purchase of a $1,500 used paver box from Highway Superintendent Matthew J. Farrs personal trucking firm. While at least one board member knew that the equipment came from Mr. Farrs business, his interest should have been put into writing, the report said.
The audit also recommended that Mr. Farr a Democrat whose name is on todays primary election ballot but who since has said he doesnt wish to be re-elected because of conflicts with the board maintain better fuel records that show the amount of beginning inventory, fuel purchased, fuel consumed and the resulting balance of fuel, not just a manual record of use.
Auditors said they were unable to account for 2,510 gallons of fuel valued at $8,440.18 during a review of 19 months worth of usage, with Mr. Farr, who took office in 2010, suggesting discrepancies may have resulted from either an employee not recording all usage or someone using fuel for other than town purposes.
Strengthening internal controls would give Town officials increased assurance that Town-purchased fuel is safe from loss or misuse and is used appropriately, the report said.
The report also recommended that the council adopt a fund balance policy, do more long-term planning and conduct an annual audit of town expenses.
In response, Supervisor Philip A. Boardman sent a letter to the comptrollers office saying that the town agrees with the audit findings and will develop a corrective action plan. The Town Council will hold a special meeting at 7 p.m. Monday to discuss that plan.