"$1.5 million theft from two tiny Missouri towns"
Seems that the former treasurer of the Wellington-Napoleon Fire Protection district and treasurer of the Wellington-Napoleon Special Road district (the one and same Mr Leland Ray Kolkmeyer) embezzled the moolah from said organizations...he being part of the entities since 1996. "He "cut checks from the public funds for himself and to pay creditors"...
Which begs the question, how the hell could that happen? Simple answer...no one was looking. Which begs another question...Why? Really good question.
WL recently had an "Agreed Upon Procedures" review of the books of the City. It basically looks at a sampling of common procedures. It no way resembles an audit, nor is it supposed. to. Ironic because, as you know, the Mayor is a CPA. and one of his first acts when he was first elected was to nominate an Audit Committee. Ostensibly there were financial irregularities and he wanted to get to the bottom of it. Another irony was not long after being elected, an audit came back for the previous year with gold star ratings for the City and previous administration...and that was the last time a meaningful look at the books was done. The Audit Committee quickly lost momentum and died a quiet death due to inactivity...only recently.
Not to insinuate that there are any irregularities in the books @ WL. But, there should be a disinterested third party doing a thorough review of the books. I would suggest when there is a lack of rigor or interest in accountability, complacency sets in. Which then presents opportunity...and bad things happen.
Mr Kolkmeyer apparently was well known in the communities, he was in the funeral home business (he is the last man to let you down)(sorry couldn't help myself). He is/was a member of the Lions, including being elected as a director of the International Association of Lions Clubs in 2006. My bet is there are many, in disbelief, who are saying he was a "nice guy". Indeed.
2 comments:
Mike, recently I was asked by someone in our community if I had seen your Nov 25th blog post. Now that I have read it, I feel I owe it to your readers & our residents to respond. As you're aware, I'm currently the City Treasurer at Weatherby Lake and have been since Mayor York hired me in 2007. I have been a CPA for over 20+ years & have 18 yrs prior audit experience. I have also been proud to call Weatherby Lake "home" for just about 16 years now.
Mike, first of all thank you for your interest in our City's finances. The articles you reference justify the need for strong internal controls & procedures. I believe today we have those in place, as was evidenced by our most recent review. More about that later. To speak to your specific question as to who is looking at Weatherby Lake's books & records, the answer is: I am, as well as the Board of Aldermen (BOA), the Mayor, the Department Heads, & our City Clerk. Collectively we are all responsible for overseeing, reviewing & approving all financial transactions. Our current procedures require at least 2 people to complete every transaction. We also have implemented segregation of duties so that our Asst City Clerk handles all cash receipts; our City Clerk handles all cash disbursements & I review all postings & perform reconcilements to General Ledger. To give an example: When an approved budget item is purchased, the appropriate Dept Head is responsible for approving the invoice for payment & indicating which line item of the budget to code it to. The approved invoice is then given to the City Clerk for review & payment; no check is issued without an approved invoice. The check & approved invoice are then given to the Mayor for his review & his signature on the check. It then gets returned to our City Clerk for her counter-signature on the check. All bills are paid by check and all checks require two signatures; also, no one signs a check made payable to themselves. Once the check is mailed, the check stub is attached to the approved invoice & provided to our BOA for their review & initial. The BOA take turns each month reviewing every paid bill. It is then my job to oversee the accounting & insure correct postings. I also reconcile the bank statements and review the canceled checks as well as deposit slips - which, by the way, are prepared by one person & then reviewed & initialed by another person prior to my review. This is just a snapshot of the type of internal controls & procedures we have in place.
I will continue in the next posting.
Continued from previous post........
The last "Certified Audit" was conducted in 2007 for the 2006 financial year & was part of a 3 yr contract with the CPA firm Marr & Company. That contract expired with the 2006 audit. In 2008 Mayor York & the BOA contracted with Miller Management Systems for an "Administrative Audit" of our 2007 financial year. Miller did not provide any type of "star" rating; however they did provide a list of commendations & corresponding recommendations for improvements. Those recommendations were implemented & the status reported to the BOA. Later in 2008 Mayor Bos & the BOA formed an "Audit Committee" to review all prior audits. The Audit Committee concurred that certified audits were not necessary. However, the Mayor & BOA agreed that it was prudent to continue having an outside 3rd party conduct an in-depth examination & review of the City's books & records. I strongly support this position. Subsequently Mayor Bos & the BOA contracted with the CPA firm Cochran Head Vick & Co to perform an "Agreed Upon Procedures" review of the 2010 financial year. As part of this review more than 200 financial transactions were randomly selected by the CPA firm for an in-depth examination & review involving cash receipts, daily postings, bank deposits, journal entries, payroll & cash disbursements. To put this in perspective, the quantity of transaction examined was more than double what would have been reviewed during a "Certified Audit." In addition to the financial sampling, they also reviewed every bank statement & reconciliation, the City's Purchasing Policy, our Employees Handbook, & also conducted a thorough review of our then-current internal controls & procedures. The CPAs' review resulted in several recommendations , which have been implemented & reported to the BOA. This past year the Mayor & BOA again contracted with the same CPA firm to perform an "Agreed Upon Procedures" review of the 2012 financial year that was identical in scope & depth as the previous review. The result of this recent review yieldied one minor recommendation, which again, has been implemented.
The act of having an outside 3rd party examine our City's books & records has & continues to be a valuable oversight to provide our residents with confidence in our financial records. We have diligently strived to implement all recommended procedures made by the prior audits & reviews, as well as put in to place additional controls & procedures to safeguard the City's assets. I welcome the opportunity to discuss any of our procedures with your or your readers or any concerns you may have. I can be reached at City Hall @ 816-741-5545, or by email at MEnnett@CityofWeatherbyLake-mo.gov. You are also welcome to stop by City Hall & file a Freedom of Information request for any of the documents I've referenced here.
Sincerely,
Marianne Ennett
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