OFFICE

OF THE

NEW YORK STATE COMPTROLLER D IVISION OF LOCAL GOVERNMENT & SCHOOL ACCOUNTABILITY

Internal Controls Over Credit Cards and Travel and Fuel Expenditures

2007-MR-5

Thomas P. DiNapoli

Table of Contents
Page

AUTHORITY LETTER

EXECUTIVE SUMMARY

INTRODUCTION Background Objectives Scope and Methodology Comments of Local Ofcials and Corrective Action

7 7 8 8 8

INTERNAL CONTROLS OVER CREDIT CARDS Authorization Policies and Procedures Review of Claims Recommendations

10 10 11 11 12

INAPPROPRIATE CHARGES Recommendations

14 15

TRAVEL AND FUEL EXPENDITURES Travel-Related Expenditures Fuel Purchases Recommendations

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APPENDIX A APPENDIX B APPENDIX C APPENDIX D APPENDIX E

Responses From Local Ofcals Audit Methodology and Standards Controls Over Credit Card Use in Sampled Municipalities How to Obtain Additional Copies of the Report Local Regional Ofce Listing

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DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY

State of New York Ofce of the State Comptroller

Division of Local Government and School Accountability January 2008 Dear Local Ofcials: A top priority of the Ofce of the State Comptroller is to help local governments ofcials manage government resources efciently and effectively and, by so doing, provide accountability for tax dollars spent to support government operations. The Comptroller oversees the scal affairs of local governments statewide, as well as compliance with relevant statutes and observance of good business practices. This scal oversight is accomplished through our audits, which identify opportunities for improving operations and Board governance. Audits also can identify strategies to reduce costs and to strengthen controls intended to safeguard local government assets. Following is a report of our audit entitled Internal Controls Over Credit Cards and Travel and Fuel Expenditures. This audit was conducted pursuant to the State Comptrollers authority as set forth in Article V, Section 1 of the State Constitution, and Article 3 of the General Municipal Law. This audits results and recommendations are resources for local ofcials to use in effectively managing operations and in meeting the expectations of their constituents. If you have any questions about this report, please feel free to contact the local regional ofce for your county, as listed at the end of this report.

Respectfully submitted,

Ofce of the State Comptroller Division of Local Government and School Accountability

DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY

State of New York Ofce of the State Comptroller

EXECUTIVE SUMMARY
It is common practice for local governments to use credit cards for the convenience of making phone or internet purchases or paying for employee travel expenses. Credit cards used by local governments include general purpose credit cards, vendor-specic cards and fuel cards. General purpose cards are frequently issued under the name of the local government in the name of a specied local ofcial; vendor-specic cards are commonly issued in the name of the local government and usually include a list of authorized users; fuel cards can be location-specic cards or travel cards that can be used at any of the designated vendors service stations. We conducted a phone survey of 43 local governments located in the 10 counties of our region to determine the extent of credit card usage. We found that 34 of those surveyed used credit cards to make purchases during 2005. Scope and Objectives The objectives of our audit were to determine whether the eight local governments (the Villages of Lake Placid and Saranac Lake, the Towns of Long Lake and Milton, the Counties of Warren and Essex and the Cities of Plattsburgh and Troy) selected from among those surveyed had adequate internal controls over government-issued credit cards and whether payments made for meals and travel-related expenses were properly authorized and appropriate for the period January 1, 2005 through September 30, 2006. More specically, we addressed the following questions: Have local governments established and monitored the implementation of appropriate internal controls over credit cards issued to their ofcers and employees? Have unauthorized or questionable costs been incurred by local governments making credit card purchases? Have local governments incurred questionable costs for meals and travel expenses or for fuel purchases charged on government-issued credit cards?

Audit Results Generally we found that several local governments have not established appropriate internal controls over credit cards and do not adequately monitor the charges made using them. Only three of the eight local governments we examined had authorized the use of credit cards through board

DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY

resolution and only two had adopted a comprehensive credit card policy. The lack of policies and corresponding guidance has resulted in local governments paying for charges included on credit card statements that were not properly supported by receipts. We examined 462 credit card charges totaling approximately $92,600 at the eight local governments and found that 235 claims totaling $38,300 (51 percent) were problematic: 114 claims (25 percent) totaling $13,300 lacked sufcient documentation, such as an itemized receipt indicating what had been charged; another 121 receipts (26 percent) totaling $25,000 lacked a signature identifying who had made the purchase. The lack of receipts could result in approving payment for an expense that was not actually incurred, or does not serve a proper municipal purpose. The absence of a signature on the receipt prevents the identication of the person responsible for the purchase and results in a lack of accountability for expenses charged to the local government. Generally, we found that local government credit card purchases were made for legitimate municipal purposes. However, only three units (Essex County, the City of Troy and the Village of Saranac Lake) had a policy that specically addressed certain prohibited expenditures. Two of the local governments without such policies (the Village of Lake Placid and City of Plattsburgh) paid for expenses that did not have a government business purpose. For example, the Village of Lake Placid paid $1,440 for food served at a retirement party. For the most part, the local governments we audited had adequately designed internal controls over meals and travel expenses. The Village of Lake Placid was the only one of the eight units that had not adopted a formal travel policy. However, we found that the City of Plattsburgh paid for $2,506 in travel-related credit card charges that lacked sufcient documentation to determine if the costs were for appropriate business-related travel. We found that six of the eight local governments used fuel cards and charged approximately $325,600 for fuel purchases during our audit period. Five of these six units had a good system of internal controls in place to ensure the appropriate use of fuel cards. However, the City of Plattsburgh, which accounted for $273,000 (84 percent) of the fuel purchases, had inadequate controls over the use of fuel cards. For example, 29 individuals designated as authorized users during our audit period were not even City employees. The lack of internal controls over fuel cards increases the possibility that fuel paid for by the City could be used for non-governmental purposes without detection. Comments of Local Ofcials The results of our audit and recommendations have been discussed with local ofcials and their comments, which appear in Appendix A, have been considered in preparing this report. Local ofcials generally agreed with our recommendations and indicated they planned to take corrective action.

OFFICE OF THE NEW YORK STATE COMPTROLLER

Introduction
Background Local governments commonly use credit cards for the convenience of making purchases over the phone, on-line, or to pay employee travel costs. The three types of commonly used credit cards are general purpose cards, vendor specic cards and fuel cards. General purpose cards are frequently issued in the name of a local ofcial and the name of the municipality. Vendor specic cards are issued in the name of the municipality and usually include a list of authorized users. Fuel cards, used to purchase gasoline and fuel oil, come in two types: one is a location- specic card issued in the name of the municipality, and the second is a travel card issued in the name of the municipality that can be used to purchase fuel at any of the vendors service stations. We conducted a phone survey of 43 local governments located in 10 counties in northeastern New York State and found that 34 of those surveyed used credit cards to make purchases during 2005. We selected eight of the 34 local governments for onsite audits. As shown below, the eight local governments had a total of 223 credit cards in use and purchased goods and services totaling approximately $775,000 from January 1, 2005 through September 30, 2006. The municipalities selected, including two villages, two towns, two cities and two counties, represented a mix of different types and sizes of units from within this 10-county region, as follows: TOTAL CREDIT CARD EXPENDITURES DURING THE AUDIT PERIOD $38,700 $17,600 $46,500 $14,700 $412,000 $13,700 $60,500 $151,300 $755,000

LOCAL GOVERNMENT Village of Lake Placid Village of Saranac Lake Town of Long Lake Town of Milton City of Plattsburgh City of Troy County of Warren County of Essex Total

CREDIT COUNTY CARDS IN USE Essex 9 Franklin and Essex 4 Hamilton 15 Saratoga 11 Clinton 84 Rensselaer 13 Warren 8 Essex 79 223

DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY

Objectives

The objectives of our audit were to determine whether adequate internal controls over government issued credit cards were in place and operating effectively and whether payments made for meals and travel-related expenses were properly authorized and appropriate. More specically, we addressed the following questions: Have local governments established and implemented appropriate internal controls over credit cards issued to their ofcers and employees? Have unauthorized or questionable costs been incurred by local governments making credit card purchases? Have local governments incurred questionable costs for meals and travel expenses or for fuel purchases charged on government issued credit cards?

Scope and Methodology

We audited credit card expenditures, including charges for meals, travel costs and fuel purchases, in eight local governments located within a 10-county region in Northeastern New York State. Our audit covered the period January 1, 2005 through September 30, 2006. From our initial telephone survey of 43 local governments in this region, we judgmentally selected eight of the 34 local governments surveyed that indicated they used credit cards to make purchases. For each unit audited, we examined warrants, claims for payment, cancelled checks, minutes of the proceedings of the governing board, accounting records, and adopted policies and procedures. We conducted our audit in accordance with generally accepted government auditing standards (GAGAS). More information on such standards and the methodology used in performing this audit are included in Appendix B of this report.

Comments of Local Ofcials and Corrective Action

The results of our audit and recommendations have been discussed with local ofcials and their comments, which appear in Appendix A, have been considered in preparing this report. Local ofcials generally agreed with our recommendations and indicated they planned to take corrective action.

OFFICE OF THE NEW YORK STATE COMPTROLLER

The Governing Boards of the eight local governments we audited have the responsibility to initiate corrective action. Pursuant to Section 35 of the General Municipal Law, each Board should prepare a plan of action that addresses the recommendations in this report and forward the plan to our ofce within 90 days. For guidance in preparing your plan of action, you may refer to applicable sections in the publication issued by the Ofce of the State Comptroller entitled Local Government Management Guide. We encourage the Boards to make this plan available for public review in the Clerks ofce.

DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY

Internal Controls Over Credit Cards

Written policies and procedures are necessary components for establishing an effective internal control structure for purposes such as the usage of credit cards and the reimbursement of expenses for local government ofcers and employees. For credit cards, a Board resolution authorizing their usage along with the adoption of a comprehensive credit card policy provides an initial framework for an effective internal control system. The governing board is also responsible for ensuring that all claims included on its credit card statements are audited to verify that costs paid by the local government are supported by adequate documentation. Seven of the eight local governments we audited did not have adequately designed internal controls over credit cards. Without ensuring that their credit cards are authorized, that the proper use of credit cards is dened by policies and procedures, and that credit card claims are supported by signed receipts, local governments could risk paying for unauthorized or excessive costs. Authorization Before a local government begins to use credit cards to pay for expenses incurred by local government ofcers and employees, a governing board should rst pass a resolution formally authorizing the use of credit cards. The resolution should specify the authorized purposes for which the cards are to be used, the number of credit cards authorized, and the credit limits for each card. We found that, out of 223 credit cards being used by the eight local governments, only 12 credit cards had been authorized by board resolution. Further, only three of the eight local governments had adopted board resolutions authorizing the use of credit cards. Only one of the three units - Warren County - had a board resolution that was reviewed regularly and amended to include all cards authorized for use in the County; the other two local governments (Milton and Plattsburgh) had adopted resolutions, but neither entity had reviewed and amended their resolution to include all authorized users and all cards currently in use. The lack of formal authorization for the use of credit cards can result in cards being applied for and used without the knowledge of local government ofcials. The lack of authorization also signicantly increases the risk

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that the local government could pay for other than legitimate government expenses. Policies and Procedures Written policies and procedures are necessary to establish an internal control structure for credit card use and the allowable expenses that local government ofcers and employees can charge on government-owned credit cards. Once the board has approved the use of credit cards by government ofcials and employees and authorized the use of the cards by board resolution, the board should adopt a comprehensive credit card policy that describes how the cards can be used and by whom, the documentation needed to support credit card claims, and the local governments recourse in the event of improper credit card use. The policy should, at a minimum: Identify all authorized users Set appropriate credit limits Establish custody of the cards when not in use Require proper documentation for all transactions Establish a means to recoup any unauthorized expenditures

Only two of the eight local governments, Warren County and the City of Troy, had adopted comprehensive credit card policies. The lack of a comprehensive credit card policy can lead to unauthorized employees making purchases on behalf of the local government; individuals making inappropriate, excessive or undocumented purchases on government credit cards; or the loss or misuse of credit cards. Moreover, without any specic policies in place, the local government may have difculty collecting reimbursement for any unauthorized or questionable charges. Review of Claims Local governments should have procedures in place to review and approve all claims prior to payment, including those claims involving the use of credit cards. Generally, a claim submitted to a local government must be written, itemized, approved by the ofcer or employee who gave rise to the claim; audited by the governing board, ofcer or employee of the local government charged with the auditing function; and in a form prescribed and approved by the governing board.

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We found that ve of the eight local governments did not have adequate procedures in place to ensure that credit card claims were sufciently documented prior to payment. We examined 462 credit card charges totaling approximately $92,600 at the eight local governments and found that 235 claims (51 percent) totaling $38,300 were problematic: 114 claims (25 percent) totaling $13,300 lacked sufcient documentation, such as an itemized receipt indicating what had been charged; another 121 receipts (26 percent) totaling $25,000 lacked a signature identifying who had made the purchase. Although supporting documentation varied greatly between local governments, we determined that adequacy of the internal controls in place was not dependent on the size or type of local government. In Essex and Warren Counties, all 64 charges tested totaling $32,200 were adequately supported by detailed signed receipts and had been audited by the County Auditor prior to payment. The Village of Saranac Lake also had a good system of internal controls in place for the audit of claims. Twenty-two charges tested totaling $10,000 were all supported by signed receipts and had been audited by the Village Board prior to payment. By contrast, of the 67 charges totaling $11,900 that we examined in the Village of Lake Placid, only 30 charges totaling $6,300 were supported by receipts; only nine of these 30 receipts totaling $1,060 had been signed by the individual making the purchase. Similarly, in the City of Plattsburgh, we examined 249 credit card transactions totaling $30,000 and found that only 205 charges totaling $24,500 were adequately supported by receipts; only 131 of these 205 charges included the signature of the individual responsible for giving rise to the claim. A proper audit cannot be made without essential documentation, including signed receipts supporting the charges listed on each credit card statement. The lack of receipts could result in approving payment for an expense that was not actually incurred, or does not serve a proper municipal purpose. The absence of a signature on the receipt prevents the identication of the person responsible for the purchase and results in a lack of accountability for expenses charged to the local government. Recommendations 1. Governing boards should formally authorize the acquisition and use of any credit cards issued in the name of the local government.

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2. Local governments using credit cards should adopt a comprehensive credit card policy and review and update the policy annually. The credit card policy should: Identify all authorized users Set appropriate credit limits Establish custody of the cards when not in use Require proper documentation for all transactions Establish a means to recoup any unauthorized expenditures.

3. Local governments should ensure that a proper audit of claims is performed prior to the payment of each credit card statement. This includes requiring that all charges on the statements are adequately supported by itemized receipts signed by the individual making the purchase.

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Inappropriate Charges
An important element of any credit card policy is the identication of the types of credit card purchases deemed acceptable for local government ofcials. Local government credit cards should be used for governmental business purposes and not for personal use. The policy should specically identify those purchases that are not allowable governmental expenditures. For example, expenditures for entertainment or other non-business purposes do not represent a proper use of public funds and such expenditures, in any amount, should not be paid by local governments. The policy should also provide for monitoring conformance with this policy by reconciling credit card statements to documentation, and for recouping any personal costs charged to government credit cards. We tested a total of $92,600 in credit card charges and $29,098 in travel-related charges to determine whether they represented reasonable, ordinary and necessary municipal expenditures. Generally, we found that local government credit card purchases were made for legitimate municipal purposes. However, only three units (Essex County, the City of Troy and the Village of Saranac Lake) had a policy that specically addressed certain prohibited expenditures. The absence of a policy that identied prohibited expenditures likely contributed to the approval and payment of inappropriate charges by local ofcials in two of the other ve municipalities. Two local governments (Village of Lake Placid and City of Plattsburgh) paid for purchases that were personal in nature. For example, we noted that the former Mayor of Plattsburgh routinely made personal charges using the City credit card. The former Mayors credit card statements during our audit period included purchases totaling approximately $6,300 from January 2005 through February 2006, when he had the card cancelled. The former Mayors handwritten notes on the statements indicated that $1,100 of the charges were personal costs. Although he reimbursed the City for $1,050 of these costs, the City had no way of determining whether the former Mayor had identied all his personal charges. If local governments do not have a policy that denes inappropriate

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personal use of government credit cards, employees can misuse the credit cards and the local government may not be able to identify and recover those expenditures. Expenditures for most meals purchased locally (rather than when traveling for business), alcoholic beverages, and other entertainment-related costs do not represent a proper use of public funds. Therefore, such expenditures, regardless of the amount, should not be permitted. We found instances where local governments inappropriately paid for entertainment costs where there was no apparent governmental purpose. For example, the Village of Lake Placid paid $1,440 for food served at a retirement party for the outgoing mayor and $169 for charges incurred at a golf shop in Saratoga Springs, New York. Neither of these expenditures appeared to be a reasonable use of Village funds. At other units we examined, we identied about $500 in other questionable charges, including meals with alcoholic beverages, entrance fees to a comedy club, a satellite radio purchase and dry cleaning costs. Alcohol and entertainment expenses are not proper municipal charges and should not be reimbursed. The failure to establish a system for properly monitoring credit card transactions to verify the business purpose of credit card charges signicantly heightens the risk of inappropriate purchases being made without being detected by local ofcials. Recommendations 4. Local government ofcials and employees should be prohibited from using government credit cards for making personal charges. 5. All billing statements should be reconciled to supporting documentation that adequately identies all charges as being valid and proper municipal expenses.

6. Local governments should seek repayment from those responsible for incurring unauthorized or inappropriate charges.

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Travel and Fuel Expenditures

Local governments may expend funds for actual and necessary costs associated with travel to events and training for government purposes, including such items as registration fees, transportation, meals and lodging, as well as for fuel used in the conduct of government business. To ensure travelrelated and fuel expenditures are legitimate municipal costs, local governments must establish and monitor compliance with a meals and travel policy, and audit and approve fuel purchases before paying the related credit card bills. Unless local ofcials regularly monitor these expenditures, local governments are at risk of paying for excessive, unnecessary or inappropriate costs. Travel-Related Expenditures Local governments must establish a meals and travel policy to dene which travel-related costs the municipality will pay for, and which costs are considered actual and necessary costs. For expenditures to be considered actual and necessary, they must be incurred for a lawful municipal purpose, and must not be for an amount that is greater than necessary. Generally, the local governments we audited had adequately designed internal controls over travel-related expenditures. Seven of the eight had formally adopted travel policies; the Village of Lake Placid was the only exception. The absence of a formal travel policy increases the likelihood that travel expenses could be incurred that are not authorized or appropriate. We tested 162 travel expenditures totaling $29,098 at the eight local governments to determine if they were both reasonable expenditures and incurred for proper municipal purposes and found exceptions at both the Village of Lake Placid and the City of Plattsburgh. We identied 16 travel reimbursements totaling $1,145 that lacked receipts detailing what was purchased. For example, we noted $236 paid at a restaurant in Lake Placid that lacked any detail information as to what was purchased and who the meal was for. We also found that the City of Plattsburgh, which has a travel policy, paid for $2,506 in 14 travel-related credit card charges that lacked sufcient documentation to determine if the costs were for appropriate business-related travel. For example, the former Mayor traveled to New York City and Albany, incurring $2,200 in travel costs, without prior approval by the 16 OFFICE OF THE NEW YORK STATE COMPTROLLER

City Council and without providing documentation detailing the purpose of the trip. The City of Plattsburghs travel policy was not effective, in these cases, because compliance with it was not enforced. Fuel Purchases As with other credit card purchases, local government ofcials are responsible for requiring that sufcient documentation be present to properly audit and approve claims for fuel purchases made with fuel company credit cards. All fuel purchases reected on statements should be supported by signed receipts to facilitate a proper audit of claims. Local governments should also have a method of identifying the individual making each fuel purchase and the vehicle using the fuel. A good system of internal controls uses an identication system at the fuel station that identies both the purchaser and the vehicle. Additionally, a fuel log should be maintained for each vehicle to reconcile the gallons purchased with the amount used. Such reconciliations should be performed by someone other than the individual responsible for making the purchases. We found that six of the eight local governments audited used fuel cards and charged approximately $325,600 for fuel purchases during our audit period. The City of Plattsburgh accounted for $273,000 (84 percent) of these purchases. The City of Plattsburgh was the only local government we examined that did not have sufcient internal controls over its fuel purchases. The City had a total of 14 credit accounts with a fuel vendor for gasoline and diesel fuel (fuel) purchases throughout the City. These accounts include one primary account in the name of the Department of Public Works and 13 subsidiary accounts in the name of various City Departments and the Plattsburgh City School District. As of the date of our examination, there were 42 cards held at three vendor locations (one for each of the 14 accounts) throughout the City, as well as three individual cards held by City ofcials and employees for their use when traveling. The fuel purchases using these 14 accounts during the audit period totaled $ 273,000. There were 205 active authorized users of the credit accounts, 29 of whom were not on the City payroll. These 29 users included 13 Plattsburgh Rescue Hose Members and 16 retired City employees. The City had not established internal controls to ensure that only authorized City employees could use the fuel cards. In addition, the City had no method to track fuel purchased to City employees or to City-owned vehicles.

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Therefore, City ofcials have no assurance that fuel charged to these accounts was used by City ofcials in City-owned vehicles for the conduct of City business. We also found weaknesses in the Citys controls over the payment of fuel credit card bills. The monthly fuel bills for all these credit accounts are mailed directly to the corresponding City departments. The summary page of the statement is then supplied to the City Chamberlains ofce for payment, along with a claim voucher signed by the department head. The Chamberlains ofce is not provided with detail of the individual fuel purchases reconciled to the individual charge receipts. City management indicated the reconciliation of receipts to the billing statement is performed at each department. However, we found this was not occurring at all City departments. Further, none of the departments maintained a fuel log to help determine if each purchase was for City equipment. Good business practices require that a fuel log be kept for each City vehicle so that the fuel used by each vehicle can be reconciled to the fuel purchased for the vehicle. Individual receipts would then be used to identify the employee making the purchase. Currently, the City relies on the vendors employees to ensure that a city vehicle is being fueled for each transaction, and then relies on inconsistently performed reconciliations performed at the departments whose employees purchase the fuel. The current process used by the City is so inadequate that it would be impossible for City ofcials to determine if purchases made with fuel credit cards were for City vehicles. The lack of internal controls over fuel cards increases the possibility that a misappropriation of fuel purchased by the City could occur and go undetected. Recommendations 7. Local governments should adopt a meal and travel policy. 8. Local ofcials should ensure travel expense reimbursements are properly audited to ensure that all charges are in accordance with adopted travel policies, are properly approved, and represent reasonable and necessary municipal expenditures. 9. Local governments should ensure fuel credit card charges are audited and approved before payment. Local ofcials

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should design an internal control structure that requires the following: Statements should be mailed directly to the chief nancial ofcer Statements should be reconciled to charge slips prior to payment Fuel logs should be maintained for each vehicle Fuel logs should be reconciled to fuel purchased as documented on the monthly statement for each account.

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APPENDIX A RESPONSES FROM LOCAL OFFICIALS

A draft copy of this report was sent to each of the eight local governments audited. The following comments were excerpted from the six responses we received. The Village of Saranac Lake Board of Trustees plans to adopt a resolution authorizing the usage of credit cards along with adopting a comprehensive credit card policy which provides an initial framework for an effective internal control system. The City of Troy administration will recommend that the City Council pass a resolution that authorizes the use of any and all City Credit Cards. Periodically, the City of Troy administration will also recommend that the City Council approve a resolution noting any additions, deletions, and changes to the Credit Card and Travel Policy as it deems necessary. The City of Plattsburgh responded, In working with the City Chamberlain, Common Council, and Department Heads, corrections will be implemented to insure taxpayer dollars will be spent fairly and wisely in the future. The Town of Long Lake stated, It certainly appears that better controls and policy is needed by almost everyone audited. But some of us, I believe, have very good internal control(s) on our staff, procedures and practice, even without some of your suggested approaches. Village of Lake Placid ofcials stated, I trust that all who will read this report will understand the importance of having in place proper policies and procedures, as well as ensuring the adopted policies and procedures are being followed. Warren County appreciates the work done by your auditor and would welcome other municipalities to use our credit cards and meal and travel reimbursement policies as guidelines to their own policies.

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APPENDIX B AUDIT METHODOLOGY AND STANDARDS

To accomplish our objective, we visited eight municipalities located in a ten county region in Northern New York State. At each of the selected municipalities, we reviewed adopted policies and procedures, general ledger print-outs, and claims for payment as they related to credit cards and travel related expenditures. We conducted our audit in accordance with generally accepted government auditing standards (GAGAS). Those standards require that we plan and perform the audit to obtain sufcient, appropriate evidence to provide a reasonable basis for our ndings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our ndings and conclusions based on our audit objectives.

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APPENDIX C CONTROLS OVER CREDIT CARD USE IN SAMPLED MUNICIPALITIES

All Credit Cards Used Authorized Municipality by Board Lake Placid No Saranac Lake No Long Lake No Milton No Plattsburgh * No Troy * No Warren Yes Essex No Adequate Credit Card Claims Policies in Review Effect Performed No No No Yes No No No No No No Yes No Yes Yes No Yes Policy Prohibits Personal Expenses No Yes No No No Yes # No Yes Meals and Travel Policy in Effect No Yes Yes Yes Yes Yes Yes Yes Controls Over Fuel Charges in Effect Yes + N/A Yes + N/A No Yes Yes Yes

* The Boards of both the Town of Milton and the City of Plattsburgh have adopted resolutions authorizing the use of credit cards, but neither local government reviews the authorization regularly to include all the credit cards currently in use. # Although the Board policy did not contain specic prohibitions against personal expenses, it provided mitigating controls by addressing improper credit card usage and requiring repayment of such expenditures. + The Town of Milton and The Village of Saranac Lake do not use fuel credit cards.

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APPENDIX D HOW TO OBTAIN ADDITIONAL COPIES OF THE REPORT

To obtain copies of this report, write or visit our web page:

Ofce of the State Comptroller Public Information Ofce 110 State Street, 15th Floor Albany, New York 12236 (518) 474-4015 http://www.osc.state.ny.us/localgov/

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APPENDIX E OFFICE OF THE STATE COMPTROLLER DIVISION OF LOCAL GOVERNMENT AND SCHOOL ACCOUNTABILITY
Steven J. Hancox, Deputy Comptroller John C. Traylor, Assistant Comptroller

LOCAL REGIONAL OFFICE LISTING

BUFFALO REGIONAL OFFICE Robert Meller, Chief Examiner Ofce of the State Comptroller 295 Main Street, Room 1050 Buffalo, New York 14203-2510 (716) 847-3647 Fax (716) 847-3643 Email: Muni-Buffalo@osc.state.ny.us Serving: Allegany, Cattaraugus, Chautauqua, Erie, Genesee, Niagara, Orleans, Wyoming counties GLENS FALLS REGIONAL OFFICE Karl Smoczynski, Chief Examiner Ofce of the State Comptroller One Broad Street Plaza Glens Falls, New York 12801-4396 (518) 793-0057 Fax (518) 793-5797 Email: Muni-GlensFalls@osc.state.ny.us Serving: Clinton, Essex, Franklin, Fulton, Hamilton, Montgomery, Rensselaer, Saratoga, Warren, Washington counties ALBANY REGIONAL OFFICE Kenneth Madej, Chief Examiner Ofce of the State Comptroller 22 Computer Drive West Albany, New York 12205-1695 (518) 438-0093 Fax (518) 438-0367 Email: Muni-Albany@osc.state.ny.us Serving: Albany, Columbia, Dutchess, Greene, Schenectady, Ulster counties

ROCHESTER REGIONAL OFFICE Edward V. Grant, Jr., Chief Examiner Ofce of the State Comptroller The Powers Building 16 West Main Street Suite 522 Rochester, New York 14614-1608 (585) 454-2460 Fax (585) 454-3545 Email: Muni-Rochester@osc.state.ny.us Serving: Cayuga, Chemung, Livingston, Monroe, Ontario, Schuyler, Seneca, Steuben, Wayne, Yates counties SYRACUSE REGIONAL OFFICE Eugene A. Camp, Chief Examiner Ofce of the State Comptroller State Ofce Building, Room 409 333 E. Washington Street Syracuse, New York 13202-1428 (315) 428-4192 Fax (315) 426-2119 Email: Muni-Syracuse@osc.state.ny.us Serving: Herkimer, Jefferson, Lewis, Madison, Oneida, Onondaga, Oswego, St. Lawrence counties BINGHAMTON REGIONAL OFFICE Patrick Carbone, Chief Examiner Ofce of the State Comptroller State Ofce Building, Room 1702 44 Hawley Street Binghamton, New York 13901-4417 (607) 721-8306 Fax (607) 721-8313 Email: Muni-Binghamton@osc.state.ny.us Serving: Broome, Chenango, Cortland, Delaware, Otsego, Schoharie, Sullivan, Tioga, Tompkins counties

HAUPPAUGE REGIONAL OFFICE Ofce of the State Comptroller NYS Ofce Building, Room 3A10 Veterans Memorial Highway Hauppauge, New York 11788-5533 (631) 952-6534 Fax (631) 952-6530 Email: Muni-Hauppauge@osc.state.ny.us Serving: Nassau, Suffolk counties

NEWBURGH REGIONAL OFFICE Christopher Ellis, Chief Examiner Ofce of the State Comptroller 33 Airport Center Drive, Suite 103 New Windsor, NY 12553-4725 (845) 567-0858 Fax (845) 567-0080 Email: Muni-Newburgh@osc.state.ny.us Serving: Orange, Putnam, Rockland, Westchester counties

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