An audit of the Bell County Sheriff’s Office has determined that things are in order for the office’s financial reporting, although some minor items were pointed out that need to be remedied in the future, according to a report from Kentucky Auditor of Public Accounts Mike Harmon.

The report indicates that the office of Bell County Sheriff Mitch Williams has fairly presented the taxes charged, credited and paid for the period of April 17, 2018 through April 15, 2019, in conformity with the regulatory basis of accounting.

As part of the audit process, the auditor must comment on noncompliance with laws, regulations, contracts, and grants. The auditor must also comment on material weaknesses involving the internal control over financial operations and reporting.

Among Harmon’s comments on the Bell County Sheriff’s Office include a lack of adequate segregation of duties over receipts, disbursements, and bank reconciliations. According to the report, the sheriff’s bookkeeper collects tax payments, prepares deposits, prepares daily tax collection journals, prepares monthly tax reports, prepares tax disbursements and signs those disbursements.

The sheriff’s office indicated that the lack of adequate segregation of duties within the sheriff’s office is the result of limited staff size, which prevented the sheriff from segregating accounting duties to different individuals within the office.

The auditor’s office recommended that the sheriff’s office segregate duties over receipts, disbursements and reconciliations. If this is not feasible, the auditor’s report stated that strong oversight of these areas should occur, involving an employee that wasn’t currently performing any of those functions. That oversight could come from the sheriff, with the oversight documented by the person doing the comparison initialing the appropriate source documents.

In response, the sheriff’s office stated that it is in the process of putting a policy in place.

The auditor’s report also pointed out five accounts which have not been settled from 2016 tax collections. The Bell County Sheriff’s Office still has receivables and liabilities that need to be collected and paid in order to settle the 2016 tax collections.

The receivables are as follows:

• Amount due from state – $20
• Amount due from Pineville School – $10
• Amount due from Middlesboro School – $373
• Amount due from Health District – $40
• Amount due from Franchise Companies – $1,340

 

According to the sheriff’s office, the receivables and liabilities are currently being collected. However, the sheriff did not maintain any documentation of this. As a result, the franchise companies did not receive the funds they overpaid, and the sheriff’s office did not receive funds which could have been used to operate his office. Proper internal controls require that all tax collections be settled timely.

Kentucky Revised Statute 134.192(7) states “On the final settlement, the sheriff shall pay to the county treasurer all money that remains in his or her hands attributable to amounts charged against the sheriff relating to the collection of property taxes, and shall take receipts as provided in KRS 134.160. The sheriff shall pay any additional amounts charged against him or her as a result of the settlements.

The auditor’s report states, “We recommend the sheriff settle his 2016 tax collections and maintain documentation of the settlement. Any outstanding checks due taxpayers should be escrowed, and subsequently turned over to the Kentucky State Treasurer as unclaimed funds.

The sheriff’s office responded that it is in the process of completing this action.