Finding for recovery issued in latest CVB audit
Lead Summary
By
The Highland County Press-
For the second straight audit, the office of Ohio Auditor of State Dave Yost has issued a finding for recovery against the Highland County Visitors Bureau's executive director.
The state auditor also again found several areas of noncompliance within the CVB, in an audit that was released Tuesday, Aug. 9 for the years 2014-15.
Additionally, during the course of the audit, the state said: "It was brought to our attention that Highland County levied a hotel lodging excise tax beginning Jan. 1, 1996, and the City of Hillsboro levied a hotel lodging excise tax beginning Jan. 1, 2006. According to the Ohio Revised Code and Attorney Opinion 2013-010, the City hotel lodging excise tax should not have been levied.
According to the state auditor's office, "Ohio Revised Code 351.021, 505.56, 5739.08, and 5739.09 authorizes townships, municipal corporations, or counties to levy taxes on transactions by which lodging by a hotel is or is to be furnished to transient guests.
"Attorney General Opinion 2013-010 states in part “ . . . legislative authority of a municipal
corporation or the board of trustees of a township that is not wholly or partly located in a county that has in effect a resolution levying a hotel lodging excise tax pursuant to R.C. 5739.09(A)(1) may, by ordinance or resolution, levy a hotel lodging excise tax pursuant to R.C. 5739.09(B)(1). . . .
"In other words, a municipal corporation or township is not permitted to levy a hotel lodging excise tax pursuant to division (B)(1) in parts of the municipal corporation or township; rather the hotel lodging excise tax levied pursuant to division (B)(1) must apply in the same manner to all hotel lodging transactions that occur anywhere within the boundaries of the municipal corporation.
"We recommend that the Visitors Bureau work with the city of Hillsboro and appropriate legal counsel to resolve this issue."
Auditor Yost's office made the same recommendation in the CVB audit released May 7, 2015, after which Hillsboro City Council president Lee Koogler told The Highland County Press that he would be meeting with City Law Director Fred Beery to discuss "how to proceed in light of the findings."
Meanwhile, the city continues to collect the tax.
Under the audit's Finding for Recovery, it was reported that CVB director Bob Lambert was overpaid $1,094.94 in 2015. He also was overpaid $28.20 in 2014.
In 2013, the executive director was paid a total of $12,919, which resulted in an overpayment of $719.
"The executive director of the Visitors Bureau of Highland County is paid an annual salary of $11,000.60 and an annual expense reimbursement of $1,200, at total of $12,200 a year," the audit states. "In 2015, the executive director was paid a total of $13,294.94, which resulted in an overpayment of $1,094.94. In accordance with the foregoing facts and pursuant to Ohio Rev. Code § 117.28, a Finding for Recovery for public monies illegally expended is hereby issued against Visitors Bureau of Highland County Executive Director Robert Lambert, in the amount of $1,123.14, and in favor of the Visitors Bureau of Highland County.
"Upon discovery of the facts, Lambert made repayment in full to the Bureau via a personal check on July 25, 2016."
The audit – available at https://ohioauditor.gov/auditsearch/Reports/2016/Visitors_Bureau_of_Highland_County_15_14-Highland_AUP.pdf – also reported:
• There are no bank reconciliations for December 31, 2015 or December 31, 2014.
• We could not agree the January 1, 2014 beginning fund balances to the December 31, 2013 balances in the prior year documentation in the prior year Agreed-Upon Procedures working papers because Fund Balance Reports were not kept until March 2014. We agreed the January 1, 2015 beginning fund balances recorded in the Fund Report to the December 31, 2014 balances in the Fund Report.
• There are no bank reconciliations to agree the Fund Balance Report to for December 31, 2015 or 2014. We confirmed the December 31, 2015 bank account balance with the Bureau’s financial institution.
• There are no bank reconciliations; therefore, we could not test reconciling debits.
• There are no bank reconciliation; therefore we could not test reconciling credits.
Recommendations
• Accurate reconciliation procedures are a key component of an effective accounting system required to enable the Bureau to properly classify transactions, maintain accountability for funds, distribute funds accurately, and detect fraud and errors in a timely manner. We noted that formal, written bank reconciliations were not performed. We recommend the Bureau prepare formal written bank reconciliations on a monthly basis
Cash Receipts
We confirmed with Highland County the lodging taxes it paid to the Bureau during the years ending December 31, 2015 and 2014. The County confirmed the following amounts: Year Ended Amount: December 31, 2015, $34,926; December 31, 2014, $30,866.
We confirmed with the City of Hillsboro the lodging taxes it paid to the Bureau during the years ending December 31, 2015 and 2014. The City of Hillsboro confirmed the following amounts: Year Ended Amount: December 31, 2015, $3,085; December 31, 2014, $4,123.
While comparing amounts to the Fund Reports and/or Bank Statements, we identified the
following instances of noncompliance:
• Ohio Administrative Code section 117-2-02 requires all public officials to maintain an accounting system and accounting records sufficient to enable the public office to identify, assemble, analyze, classify, record and report its transactions, maintain accountability for related assets, document compliance with finance related legal and contractual requirements and prepare financial statements. This section of the Ohio Administrative Code requires all local public offices maintain records (manual or automated) that include the following: (1) cash journal; (2) receipts ledger; and 3) appropriation ledger.
The Bureau did not maintain a cash journal, receipts ledger, or appropriation ledger.
The Bureau should maintain the following records:
A. Cash journal, which typically contains the following information: The amount, date, receipt number, check number, account code, purchase order number, and any other information necessary to properly classify the transaction.
B. Receipts ledger, which typically assembles and classifies receipts into separate accounts for each type of receipt of each fund the public office uses. The amount, date, name of the payer, purpose, receipt number, and other information required for the transactions can be recorded on this ledger.
C. Appropriation ledger, which may assemble and classify disbursements or expenditure/expenses into separate accounts for, at a minimum, each account listed in the appropriation
resolution. The amount, fund, date, check number, purchase order number, encumbrance
amount, unencumbered balance, amount of disbursement, and any other information required may be entered in the appropriate columns.
* * *
The CVB Board of Trustees announced last month that it is seeking a new director. Applications and resumés may be sent to Tom Horst at the Commissioners' Office, 119 Gov. Foraker Place, Hillsboro 45133.
Currently serving on the Board of Trustees are: board president Tom Horst, Highland County Commissioners representative; vice president Tim Koehl, at-large member; secretary Kim Abbott, government representative; Ron Coffey, at-large member; Janet Shawhan, hospitality representative; Debra Crago, Greenfield business representative; Phil Clyburn, at-large member; Sharon Hughes, Rocky Fork Lake representative; Joe Mahan, Hillsboro business representative; and Sharon Bedard, Lynchburg business representative.
The state auditor also again found several areas of noncompliance within the CVB, in an audit that was released Tuesday, Aug. 9 for the years 2014-15.
Additionally, during the course of the audit, the state said: "It was brought to our attention that Highland County levied a hotel lodging excise tax beginning Jan. 1, 1996, and the City of Hillsboro levied a hotel lodging excise tax beginning Jan. 1, 2006. According to the Ohio Revised Code and Attorney Opinion 2013-010, the City hotel lodging excise tax should not have been levied.
According to the state auditor's office, "Ohio Revised Code 351.021, 505.56, 5739.08, and 5739.09 authorizes townships, municipal corporations, or counties to levy taxes on transactions by which lodging by a hotel is or is to be furnished to transient guests.
"Attorney General Opinion 2013-010 states in part “ . . . legislative authority of a municipal
corporation or the board of trustees of a township that is not wholly or partly located in a county that has in effect a resolution levying a hotel lodging excise tax pursuant to R.C. 5739.09(A)(1) may, by ordinance or resolution, levy a hotel lodging excise tax pursuant to R.C. 5739.09(B)(1). . . .
"In other words, a municipal corporation or township is not permitted to levy a hotel lodging excise tax pursuant to division (B)(1) in parts of the municipal corporation or township; rather the hotel lodging excise tax levied pursuant to division (B)(1) must apply in the same manner to all hotel lodging transactions that occur anywhere within the boundaries of the municipal corporation.
"We recommend that the Visitors Bureau work with the city of Hillsboro and appropriate legal counsel to resolve this issue."
Auditor Yost's office made the same recommendation in the CVB audit released May 7, 2015, after which Hillsboro City Council president Lee Koogler told The Highland County Press that he would be meeting with City Law Director Fred Beery to discuss "how to proceed in light of the findings."
Meanwhile, the city continues to collect the tax.
Under the audit's Finding for Recovery, it was reported that CVB director Bob Lambert was overpaid $1,094.94 in 2015. He also was overpaid $28.20 in 2014.
In 2013, the executive director was paid a total of $12,919, which resulted in an overpayment of $719.
"The executive director of the Visitors Bureau of Highland County is paid an annual salary of $11,000.60 and an annual expense reimbursement of $1,200, at total of $12,200 a year," the audit states. "In 2015, the executive director was paid a total of $13,294.94, which resulted in an overpayment of $1,094.94. In accordance with the foregoing facts and pursuant to Ohio Rev. Code § 117.28, a Finding for Recovery for public monies illegally expended is hereby issued against Visitors Bureau of Highland County Executive Director Robert Lambert, in the amount of $1,123.14, and in favor of the Visitors Bureau of Highland County.
"Upon discovery of the facts, Lambert made repayment in full to the Bureau via a personal check on July 25, 2016."
The audit – available at https://ohioauditor.gov/auditsearch/Reports/2016/Visitors_Bureau_of_Highland_County_15_14-Highland_AUP.pdf – also reported:
• There are no bank reconciliations for December 31, 2015 or December 31, 2014.
• We could not agree the January 1, 2014 beginning fund balances to the December 31, 2013 balances in the prior year documentation in the prior year Agreed-Upon Procedures working papers because Fund Balance Reports were not kept until March 2014. We agreed the January 1, 2015 beginning fund balances recorded in the Fund Report to the December 31, 2014 balances in the Fund Report.
• There are no bank reconciliations to agree the Fund Balance Report to for December 31, 2015 or 2014. We confirmed the December 31, 2015 bank account balance with the Bureau’s financial institution.
• There are no bank reconciliations; therefore, we could not test reconciling debits.
• There are no bank reconciliation; therefore we could not test reconciling credits.
Recommendations
• Accurate reconciliation procedures are a key component of an effective accounting system required to enable the Bureau to properly classify transactions, maintain accountability for funds, distribute funds accurately, and detect fraud and errors in a timely manner. We noted that formal, written bank reconciliations were not performed. We recommend the Bureau prepare formal written bank reconciliations on a monthly basis
Cash Receipts
We confirmed with Highland County the lodging taxes it paid to the Bureau during the years ending December 31, 2015 and 2014. The County confirmed the following amounts: Year Ended Amount: December 31, 2015, $34,926; December 31, 2014, $30,866.
We confirmed with the City of Hillsboro the lodging taxes it paid to the Bureau during the years ending December 31, 2015 and 2014. The City of Hillsboro confirmed the following amounts: Year Ended Amount: December 31, 2015, $3,085; December 31, 2014, $4,123.
While comparing amounts to the Fund Reports and/or Bank Statements, we identified the
following instances of noncompliance:
• Ohio Administrative Code section 117-2-02 requires all public officials to maintain an accounting system and accounting records sufficient to enable the public office to identify, assemble, analyze, classify, record and report its transactions, maintain accountability for related assets, document compliance with finance related legal and contractual requirements and prepare financial statements. This section of the Ohio Administrative Code requires all local public offices maintain records (manual or automated) that include the following: (1) cash journal; (2) receipts ledger; and 3) appropriation ledger.
The Bureau did not maintain a cash journal, receipts ledger, or appropriation ledger.
The Bureau should maintain the following records:
A. Cash journal, which typically contains the following information: The amount, date, receipt number, check number, account code, purchase order number, and any other information necessary to properly classify the transaction.
B. Receipts ledger, which typically assembles and classifies receipts into separate accounts for each type of receipt of each fund the public office uses. The amount, date, name of the payer, purpose, receipt number, and other information required for the transactions can be recorded on this ledger.
C. Appropriation ledger, which may assemble and classify disbursements or expenditure/expenses into separate accounts for, at a minimum, each account listed in the appropriation
resolution. The amount, fund, date, check number, purchase order number, encumbrance
amount, unencumbered balance, amount of disbursement, and any other information required may be entered in the appropriate columns.
* * *
The CVB Board of Trustees announced last month that it is seeking a new director. Applications and resumés may be sent to Tom Horst at the Commissioners' Office, 119 Gov. Foraker Place, Hillsboro 45133.
Currently serving on the Board of Trustees are: board president Tom Horst, Highland County Commissioners representative; vice president Tim Koehl, at-large member; secretary Kim Abbott, government representative; Ron Coffey, at-large member; Janet Shawhan, hospitality representative; Debra Crago, Greenfield business representative; Phil Clyburn, at-large member; Sharon Hughes, Rocky Fork Lake representative; Joe Mahan, Hillsboro business representative; and Sharon Bedard, Lynchburg business representative.