Vague contract language and internal control weaknesses may have led to thousands of dollars in findings for recovery in an audit of Jackson County released today by Auditor of State Mary Taylor.
“Proper internal controls and documentation are imperative to maintaining sound financial accountability,” said Taylor. “By failing to implement internal controls, an entity opens itself up to potential mismanagement and fraud.”
As part of the county’s regular financial audit for 2005, state auditors asked the Jackson County prosecutor to review an employment contract between the Jackson County Board of Mental Retardation and Developmental Disabilities (MR/DD) and several administrative employees. The prosecutor concluded that the MR/DD board approved a contract determining severance pay should be calculated based on a 242-day work year. However, three employees’ final paycheck and severance pay was improperly calculated based on a 232-day work year. Calculating on a 232-day work year meant three employees received a larger final paycheck and severance pay than they should have. Based on those overpayments, auditors issued findings for recovery against the following individuals:
- Former Superintendent Ann Ogletree for $1,992.45.
- Former Administrative Assistant Lori Bailey for $1,147.88.
- Former MR/DD Service Support Administrator Catherine Rippeth for $1,090.05.
Auditors also found a lack of appropriate internal control procedures in J-VAC Industries. J-VAC Industries is a non-profit component unit of Jackson County that receives funds from the United Fund of Jackson County. The audit found that $3,750 worth of checks had been cashed but not deposited. The checks were cashed and then held in the office to be used for purchases to benefit the facility. Auditors were provided receipts for $522.70 of the $3,750. The remaining balance of cash was missing. Further, auditors found the cash had been stored unsecured in an empty software box. As a result, the audit contains a finding for recovery in the amount of $3,227.30 against former J-VAC Industries director Richard Moore. Administrative Secretary Penny Blackburn was named in the finding for recovery for $631.95 of the $3,227.30 having signed one of the checks.
The audit also contained various noncompliance citations and made recommendations for improvements. The audit is available online here.