[Southsider2k12]

Millions in errors documented by audit of LaPorte County.

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AMANDA GRAY South Bend Tribune agray@sbtinfo.com | Updated 9 hours ago

LAPORTE -- A recent audit has revealed millions of dollars in accounting and tax errors in the LaPorte County Auditor’s office from September 2011 to December 2012.

It also turned up lax record-keeping regarding county credit cards.

An Indiana State Board of Accounts report, filed Feb. 21, also details the mishandling of county funds by former deputy auditor Mary Ray, who allegedly took more than $153,000 from cash deposits made to the auditor’s office.

The audit shows more than $34.3 million in uncorrected differences between county bank accounts and the Treasurer’s ledgers from 2009 to 2012. Some of those differences are noted in reconciling items (which can be things like uncashed checks), while others are unidentified.

As of Nov. 14, 2013, no full reconcilement between bank accounts and the auditor’s ledgers was completed by county staff, the report states.

Former auditor Craig Hinchman responded with an official statement included in the report, and said many of the errors were out of his and his staff’s control. Hinchman served as LaPorte County auditor from Jan. 1, 2009, to Dec. 31, 2012.

When it came to the condition of the county’s bookkeeping, Hinchman cited the need to meet a state-imposed deadline of completing prior taxes as reason for letting some daily tasks slide.

“If LaPorte County did not get three years of taxes completed in 2012 the State of Indiana was going to fine the county one million dollars,” Hinchman wrote in his response. “So the focus of my department along with other departments was to comply with this order. Some of the day to day operations suffered. This would not have happened if we were not trying to make the dead line.”

The audit states that the SBOA staff found 10 accounts with overdrawn balances totaling more than $14.3 million as of Dec. 31, 2012. It’s unclear what the current balances of those accounts are, and two phone messages left with the current auditor, JoEileen Winski, were not returned Tuesday afternoon.

The department’s bookkeeping included multiple errors that were not corrected — or even noticed — until some time in 2013. For example, an erroneous $5.7 million disbursement was made in 2012 from the Major Moves Fund, but wasn’t discovered and corrected until 2013, according to the report.

The report also noted that, as of June 30, 2013, the Excess Tax Fund had a negative balance of more than $4.9 million. According to the report, this represents funds that were refunded to taxpayers who had overpaid their property taxes, and the account should’ve been credited from the treasurer before the disbursement was made to cover it. The report states this was not corrected in 2013.

“I had a wonderful staff and we worked hard to see that things were done right,” Hinchman wrote in his official statement. “Our audits for three years were considered good. We made improvements over the way things were done by the previous Auditor. When I took office no Auditor in the history of the State of Indiana, found there (sic) office in the turmoil I did.”

Hinchman also addressed the overdrawn cash balances, but said that it’s also the responsibility of individual department heads to keep an eye on their budgets.

“Each department has people in their department that do bookkeeping there is no excuse for them to be overdrawn,” Hinchman wrote. “They also know that they can go before the council and ask for additional appropriations and know that the council will grant them.”

In addition to poor bookkeeping, the audit highlighted that staffers use credit and other charge cards to purchase items without an approved credit card policy, and sometimes make the purchases before they are approved. In some instances, late and annual fees, as well as interest, were charged and paid.

However, county officials could not provide a list of who has these cards, the report said.

Hinchman said the LaPorte County Commissioners have a “loose policy” when it comes to credit and charge cards.

“The Auditor does not have the power to force the Commissioners or Council to follow the rules,” Hinchman said in his statement. “The department heads and elected officials don’t always inform the Auditor’s office of all the things their (sic) doing.”

AGray@SBTinfo.com

[Southsider2k12]

They are saying that all money is accounted for.

http://www.nwitimes.com/news/local/laporte...60ff5dcf69.html

Stan Maddux Times Correspondent

All of the financial ledgers for LaPorte County government now balance after an audit by the state found $34 million unaccounted for.

With the exception of the $150,000 sought for repayment from a now former high ranking official, all of the money at question always has been in the county's coffers.

The funds needed to be tracked down and properly recorded, which has taken place, said LaPorte County attorney Shaw Friedman.

"Now, the bank statements correspond with what the ledger that's actually maintained by the county," Friedman said.

The State Board of Accounts released an audit Feb. 21 that showed more than $34 million unreconciled from 2009 through 2012.

The final 16 months of that period is when approximately $150,000 went missing. State auditors have ordered former Chief Deputy Auditor Mary Ray to repay that money, although Ray has not been criminally charged with taking the funds. The Indiana State Police investigation into the missing funds is ongoing.

Ray worked under Craig Hinchman, who was the auditor for one term, which ended Dec. 31, 2012.

In a written statement provided with the audit, Hinchman said trying to bring up to date several years of tax billing delayed from a countywide property tax reassessment hanging in balance was partially to blame for the bookkeeping flaws.

He said the county faced a $1 million fine from the state if the property tax billing wasn't made current by deadline.

And, to avoid the fine, "some of the day-to-day operations suffered. This would not have happened if we were not trying to meet deadline," Hinchman said.

The audit also cited many departments using credit cards, gas cards and department store charge cards/accounts to purchase items without an approved credit card policy.

Most of the purchases were made before purchase orders were prepared and approved, according to findings of the audit.

Friedman said the errors occurred when he was not the county attorney and before two new members of the three-member County Commission took over in 2013.

The new commission in December implemented a policy governing credit card and other purchases to provide more accountability within departments and in 2013 hired a private accounting firm to straighten out the books.

"This group of county commissioners has worked to really get its arms around the situation," Friedman said.

[Southsider2k12]

Auditor is fixing the errors...

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