Airway Heights Fixes Flaws Found By Auditor

The state auditor found several problems in the accounting practices of the city of Airway Heights in an audit recently released to the public.

“All of them were corrected,” said City Administrator Mike Patterson.

He described the findings by the auditor as an effort to protect taxpayers from the potential for fraud or loss. Otherwise, the city’s financial statements passed the audit without any problems, Patterson said. The audit covered transactions during 1995.

According to the audit, the city did not have sufficient internal controls over $129,000 in miscellaneous funds.

Lack of internal controls could create a potential for theft or embezzlement, although the audit found no such problems occurring.

“They are helping make sure fraud doesn’t occur,” Patterson said.

For example, access to the the cash box was not sufficiently restricted.

According to the auditor, the city’s change fund, its petty cash fund and funds used to cash personal checks were commingled, and that created a potential for problems.

Keeping the accounts separate “is essential to preventing and detecting a common technique used to steal funds,” the auditor wrote in the findings.

In another example, business licenses, animal licenses, permits and citations were not prenumbered or independently reconciled to receipts.

Unused permits were not adequately safeguarded and, in some cases, receipts were not issued immediately.

In other issues, the auditor found weaknesses in the billing system for city utilities.

An error in computer software led to some customers being undercharged. The city had not recalculated the charges or pursued collection of the bills, the audit said.

Independent reconciliations of water installations and sewer hookups to the fees collected had not been performed.

The city was also faulted for not having enough internal controls over contracts with the non-profit West Plains Service and Development Association.

The association provided education, recreation and social services under contract with the city.

The auditor said the contracts with the association were vague and could lead to the city being obligated to pay twice for the same services.

After the audit, the city renegotiated the contracts and stopped purchasing recreational services from the association.

, DataTimes