audit_findings: 35

This data as json

rowid	source	report_number	finding_number	muni_id	state	entity_name	entity_type	entity_ext_id	place_geoid	match_method	auditor	report_title	audit_type	fiscal_year	period_start	period_end	published_date	finding_category	severity	questioned_cost	cost_basis	finding_title	finding_text	report_url	fetched_at
35	wa-sao	1021303	2017-001		WA	Mason County Fire Protection District No 18	Fire Protection District	0300		not_municipal	Washington State Auditor's Office	Accountability audit — Mason County Fire Protection District No 18	Accountability	2017	2016-01-01	2017-12-31	2018-05-21	misappropriation				The District did not have adequate internal controls over cash receipting and petty cash to ensure adequate safeguarding of public resources	Background Mason County Fire Protection District No. 18 is located in Mason County and serves the Lake Cushman area. The District’s total revenue was about $362,000 and $211,000 in 2016 and 2017, respectively. District management is responsible for establishing effective internal controls to ensure compliance with state law and adequate safeguarding of public funds. Description of Condition The District’s internal control systems were inadequate to ensure compliance with state laws and safeguarding of public resources. Our current audi t identified the following control deficiencies: Cash receipting The District receives an average of $14,000 a year in revenue other than taxes. The District did not record or have records of funds receipted, and did not have a reconciliation function to ensure receipted funds were adequately safeguarded from loss or misappropriation. In addition, the District lacked adequate controls to ensure funds were deposited promptly in accordance with state law (RCW 43.09.240). Because there were not adequate controls or any records of cash receipted, we were not able to test cash receipting. There is a continued risk of loss or misappropriation for cash receipting. Petty cash The District had a petty cash fund of $1,000 and total replenishments to the fund of about $3,000 in 2016 and 2017. The District identified a loss of $666 in petty cash funds. We tested 42 petty cash expenditures and six monthly reimbursements for those expenses from 2016 and 2017. We noted the following: Washington State Auditor’s Office Page 7 • Three of the six monthly reimbursement amounts did not tie to supporting receipts. We identified a total of $1,127 in petty cash expenditures that were unsupported or questionable. • 17 petty cash expenses, totaling $346, were used by or reimbursed to the petty cash custodian without a secondary review or approval. • 14 petty cash expenses, totaling $424, were not allowable because the District had not determined in its policy that they were a valid use of funds. Cause of Condition The District staff responsible for cash receipting and petty cash lacked adequate training and resources to establish adequate internal controls. In addition, District management did not dedicate sufficient resources or monitoring to ensure effective internal controls were established and consistently applied. Effect of Condition Without adequate internal controls in place to ensure compliance with state law and safeguarding of public resources, the District is at increased risk of noncompliance, fraud and abuse. Noncompliance, fraud and abuse can result in loss of public trust, fewer resources available to perform services and inability to maintain the public assets entrusted to the District by its taxpayers. Recommendation We recommend the District establish a process to proactively identify, assess and respond to risks. We further recommend the District establish and follow internal controls to ensure: • Receipted funds are recorded, promptly deposited, intact and reconciled by someone not involved in the receipting process • Petty cash reimbursements are supported by adequate documentation and have a secondary review to ensure all expenses are for District purposes and allowable under District policy Finally, we recommend the District ensure employees responsible for key internal controls receive adequate training to effectively perform their duties. Washington State Auditor’s Office Page 8 District’s Response On December 31 st, 2016 we had a change of district secretary and then the termination of our Fire Chief on January 13 th, 2017. This all prompted considerable examination of our policies and procedures that were in place. Mason County Fire District 18 adopted many new policies on March 31 st, 2017. The petty cash policy was included in this grouping. The Cash receipting policy has been instituted in accordance with RCW 43.09.240 We now have a detailed review and audit of all payments made to our volunteers and procedures set in place to monitor warrants and credit card transactions. Prior to our onsite audit, most of the issues noted had been addressed. The recommendations from the State Auditor’s office regarding findings noted will be implemented where appropriate. Auditor’s Remarks We want to thank the District for its assistance throughout the audit and the steps it is taking to address the issues. The District’s status of corrective actions will be reviewed during our next audit. Applicable Laws and Regulations RCW 43.09.200 – Local government accounting – Uniform system of accounting, gives the state auditor the authority to formulate, prescribe and install a uniform system of accounting and reporting for all local governments. Budgeting Accounting and Reporting System (BARS) Manual – Accounting, Accounting Principles and General Procedures, Internal Control defines internal control, describes it purpose, and specifies each entity is responsible for establishing and maintaining an effective system of internal control throughout their government. RCW 43.09.240 – Local government accounting – Public officers and employees – Duty to account and report – Removal from office – Deposit of collections, describes the timely depositing requirements for local governments. Washington State Auditor’s Office Page 9	https://portal.sao.wa.gov/ReportSearch/Home/ViewReportFile?arn=1021303&isFinding=false&sp=false	2026-07-30 13:24:54