'Concerns' about utility's management

By Pat Jenkins The Dispatch The tiny Elbe Water and Sewer District has been asked by the state auditor to put its financial house in better order. Following a recent review of its operations in 2013, the district, which does only about $30,000 of business a year, was asked by the auditor to iimprove business practices and financial recordkeeping, including "weak control" of cash. A report from the auditor's office stopped short of fully criticizing the district through official findings. But recommendations were made in what the state agency calls a management letter. Thomas Shapley, a spokesman for the auditor's office in Olympia, said the letter explains "concerns that we found during our audit that did not rise to the level of a formal finding, but were deemed important enough to put in writing." The state conducts regularly scheduled audits of local government entities, including taxing districts such as Elbe Water and Sewer. The intent is to help them reduce expenses, manage financial dealings and records correctly, and comply with federal, state and local laws. The latest review of the Elbe district was for 2013. The auditor stated in the management letter that: " The minutes of meetings of the district's elected board of commissioners "do not consistently include sufficient detail of business conducted at board meetings, including: start and end times, dates for the approval of prior minutes, approval of the annual budget, business discussions, and total amounts and voucher numbers listed for the approval of vouchers and payroll. We recommend the district ensure the board minutes document all significant actions taken at meetings" and that the minutes "include the board-approved voucher numbers and total amount paid," as required by state law. " "Our review of district cash receipting practices revealed a lack of separation of duties, resulting in weak controls over cash. The same person bills, receives and deposits funds with limited independent reconciliation performed by district personnel. We recommend the district develop procedures to reconcile billings and receipts to money deposited with the county treasurer by a person independent of the billing and receiving activities of the district, and document the reconciliations in writing. We further recommend the district develop written cash processing procedures. We believe this recommendation will significantly reduce risks associated with district receipts." The issues raised in the letter aren't "significant enough at this time to be considered findings in our published audit report" that was released in August, but they will be reviewed again "during our next audit," auditor officials wrote.. The officials also noted that the district's "internal controls were adequate to safeguard public assets, and that it has complied with state laws and its own policies.. The district, which was formed in 1976, provides water and sewer service to customers in an area of slightly more than one square mile, including the community of Elbe. Billings for the services totalled approximately $30,000 per year in 2011, 2012 and 2013, the auditor reported. The district is governed by three commissioners. The facilities they oversee include a wastewater treatment system that began operating in 1985.


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