Harmon Releases Audit of Lawrence County Sheriff’s Office
FRANKFORT, Ky. – State Auditor Mike Harmon today released the audit of the 2021 financial statement of Lawrence County Sheriff Chuck Jackson.
State law requires the auditor to annually audit the accounts of each county sheriff. In compliance with this law, the auditor issues two sheriff’s reports each year: one reporting on the audit of the sheriff’s tax account, and the other reporting on the audit of the fee account used to operate the office.
Auditing standards require the auditor’s letter to communicate whether the financial statement presents fairly the receipts, disbursements, and excess fees of the Lawrence County Sheriff in accordance with accounting principles generally accepted in the United States of America.
The sheriff’s financial statement did not follow this format. However, the sheriff’s financial statement is fairly presented in conformity with the regulatory basis of accounting, which is an acceptable reporting methodology. This reporting methodology is followed for all 120 sheriff audits in Kentucky.
The auditor noted no instances of noncompliance. The auditor also noted no matters involving internal control over financial reporting and its operation that were considered to be material weaknesses.
The sheriff’s responsibilities include collecting property taxes, providing law enforcement and performing services for the county fiscal court and courts of justice. The sheriff’s office is funded through statutory commissions and fees collected in conjunction with these duties. The audit report can be found on the auditor’s website.
Harmon Releases Audit of Martin County Sheriff’s Fee Account
FRANKFORT, Ky. – State Auditor Mike Harmon today released the audit of the 2021 financial statement of Martin County Sheriff John Kirk.
State law requires the auditor to annually audit the accounts of each county sheriff. In compliance with this law, the auditor issues two sheriff’s reports each year: one reporting on the audit of the sheriff’s tax account, and the other reporting on the audit of the fee account used to operate the office. Auditing standards require the auditor’s letter to communicate whether the financial statement presents fairly the receipts, disbursements and excess fees of the Martin County Sheriff in accordance with accounting principles generally accepted in the United States of America.
The sheriff’s financial statement did not follow this format. However, the sheriff’s financial statement is fairly presented in conformity with the regulatory basis of accounting, which is an acceptable reporting methodology. This reporting methodology is followed for all 120 sheriff audits in Kentucky.
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.
The audit contains the following comment:
The sheriff’s does not have an adequate segregation of duties: This is a repeat finding and was included in the prior year audit report as Finding 2020-001. The sheriff’s office does not have adequate segregation of duties over receipts and disbursements.
These deficiencies are present because one employee’s duties include the preparing and reviewing of receipts and disbursements ledger, monthly reconciliations, and quarterly reports.
The sheriff has not structured his office in a way that segregates duties and responsibilities. The sheriff has also not provided sufficient oversight of the financial reporting process. A lack of oversight could result in misappropriation of assets or inaccurate financial reporting to external agencies such as Department for Local Government (DLG), which could occur and go undetected.
A proper segregation of duties over these tasks or the implementation of compensating controls, when limited by the number of staff, is essential for providing protection against the misappropriation of assets and inaccurate financial reporting.
Additionally, proper segregation of duties protects employees in the normal course of performing their daily responsibilities. We recommend the same person not perform multiple accounting functions, and if the duties cannot be segregated, then the sheriff should provide and document strong oversight over the employee’s work.
County Sheriff’s Response: Due to a very limited budget, we are not able to separate duties any further. We will try to use compensating controls as much as possible. The Sheriff reviews as much as he possibly can, but due to a limited budget, he also serves as a road deputy and has limited time to review administrative documentation.
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The sheriff’s responsibilities include collecting property taxes, providing law enforcement and performing services for the county fiscal court and courts of justice. The sheriff’s office is funded through statutory commissions and fees collected in conjunction with these duties. The audit report can be found on the auditor’s website. ### The Auditor of Public Accounts ensures that public resources are protected, accurately valued, properly accounted for, and effectively employed to raise the quality of life of Kentuckians.
Great job Sheriff Jackson.