Southeast Missouri's Bollinger County received the second-lowest possible rating on an audit issued by the state Monday.

Auditor Tom Schweich gave the county a "fair" rating after finding problems with controls and procedures in several offices and a potential law violation related to the amount of taxes being levied on residents.

A "fair" rating, according to the auditor's office, indicates an entity "needs to improve operations in several areas" and "contains one or more findings that require management's immediate attention and/or the entity has indicated several recommendations will not be implemented."

In the case of Bollinger County, the responses of officeholders to the auditor's findings are reported to fit the rating characteristics.

The audit covers the county's financial statements for the year ending Dec. 31, 2012.

Findings included:

In the sheriff's office, an office manager was fired in July 2013 after $2,600 was stolen. The employee was charged with felony theft and pleaded guilty, but the audit found control problems in the office, including segregation of accounting duties and receipting and depositing procedures being inadequate "contributed to the opportunity for loss, theft or misuse of funds."

Other issues in the sheriff's office included accounts being held outside the county treasury and increases in the county's jail boarding rate.

The sheriff's office, in responses to the auditor's office by Sheriff Darrin Shell, agreed to perform a review of accounting records, issue receipts and document reconciliation of deposits, keep receipt books and discuss turning over accounts to the county treasurer. Shell also said the prisoner boarding rate has not increased because parties have not agreed on a rate increase.

The audit also said improvements are needed for the county's payroll and personnel policies.

Among the findings were the county clerk does not maintain adequate records on employees' vacations, sick leave and other time off, even though county policies require officials to maintain timesheets and submit them to the clerk.

The auditor's report stated the county should monitor leave records more closely, and failure to do so could subject the county to legal battles with employees.

In addition, documentation of employee pay rates is not being kept by the county clerk, the audit found.

The audit found the county has not adopted formal policies for overtime and the supervision of related employees.

The auditor made recommendations on payroll and personnel policies. But in its responses, the county agreed only to ensure documented pay rates and develop a policy on overtime. The county's current procedures for centralized payroll records will be kept, according to the response.

County procedures for fuel usage, contracts, property taxes, mileage and computer system security controls also need improvement, the audit said.

On fuel procedures, the county has not monitored use or reconciled billings to records, the audit found. The county responded it is determining whether there is a cost-effective way to fix that problem.

The county also did not always enter into written contracts with vendors. The county responded it would implement the auditor's recommendation on contracts.

On property taxes, the county clerk and commission did not review financial activities of the county collector, who processed $5.5 million in property tax collections for 2012. The auditor recommended the clerk maintain an account book with the collector and that the clerk and commission use the book to compare with the collector's annual settlements. The county will consider implementing that recommendation, according to the response.

For mileage, the auditor recommended the county comply with Internal Revenue Service guidelines on reporting and require mileage logs. The county plans to implement that recommendation.

A problem with security controls on computer log attempts outlined in the audit has been corrected, according to the county's response.

A potential violation of state law the audit said was noted in two previous reports is the amount of sales-tax levies being charged.

In 1989, 2006 and 2007, voters approved sales-tax levies that total 1 1/8 percent, which the audit says exceeds the statutory maximum. A portion of the taxes, 1 percent, is levied for general sales tax. The remainder is charged for funding senior-citizen services.

The auditor recommended the county consult with an attorney on the levies to determine what steps to take.

The county commission responded, the audit said, that "the people voted for these sales taxes; therefore we do not plan on changing them."

eragan@semissourian.com

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Pertinent address:

204 High St., Marble Hill, MO