PRENTISS COUNTY Notes to Financial Statements For the Year Ended September 30, 1997 (2) Stewardship, Compliance and Accountability_part3 pptx

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OFFICE OF THE STATE AUDITOR
PHIL BRYANT
AUDITOR
INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH STATE
LAWS AND REGULATIONS
July 31, 1998
Members of the Board of Supervisors
Prentiss County, Mississippi
We have audited the general-purpose financial statements of Prentiss County, Mississippi, as of and for the
year ended September 30, 1997, and have issued our report thereon dated July 31, 1998. The Independent Auditor=s
Report on the general purpose financial statements is qualified because we were unable to satisfy ourselves as to the fair
presentation of the General Fixed Assets Account Group, reported on the combined balance sheet at $4,479,997, as of
September 30, 1997. We conducted our audit in accordance with generally accepted auditing standards and the
procedures prescribed by the State Auditor, and accordingly, included such tests of the accounting records and such
other auditing procedures as we considered necessary in the circumstances.
As required by the state legal compliance audit program prescribed by the Office of the State Auditor, we have
also performed procedures to test compliance with certain state laws and regulations. Our procedures were substantially
less in scope than an audit, the objective of which is the expression of an opinion on the county's compliance with these
requirements. Accordingly, we do not express such an opinion.
The results of our procedures and our audit of the general-purpose financial statements disclosed certain
immaterial instances of noncompliance with state laws and regulations. Our findings and recommendations and your
responses are included in the accompanying Schedule of Findings.
This report is intended for the information of management. This is not intended to limit the distribution of this
report, which is a matter of public record.
PHIL BRYANT RAMONA HILL, CPA
State Auditor Director, Financial and Compliance Audit Division
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PRENTISS COUNTY
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PRENTISS COUNTY
SCHEDULE OF FINDINGS
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PRENTISS COUNTY
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PRENTISS COUNTY
Schedule of Findings
For the Year Ended September 30, 1997
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A. Findings - Independent Auditor's Report on Compliance and on Internal Control Over Financial Reporting
Based on an Audit of the General-Purpose Financial Statements Performed in Accordance With Government
Auditing Standards
Inventory Control Clerk.
97-1. Finding
As reported in the last fourteen years’ audit reports, fixed asset control procedures were inadequate
for maintaining an accurate inventory or adequate subsidiary records documenting the valuation and
completeness of general fixed assets. Therefore, the Independent Auditors= Report is qualified
because we were unable to satisfy ourselves as to the fair presentation of the General Fixed Assets
Account Group, reported on the combined balance sheet at $4,479,997. Failure to establish and
maintain an inventory control system for the county=s fixed assets could result in a loss of public
property.
Recommendation
The Inventory Control Clerk should establish adequate control procedures to ascertain the historical
cost and/or estimated cost of general fixed assets and to maintain accurate inventory records
documenting the valuation and completeness of general fixed assets.
Inventory Control Clerk=s Response
There must be more cooperation from other department managers in a constant effort if the duties of
adding/deleting and maintaining are to be performed in an accurate manner for documentation. Steps
to correct this matter have been started but not completed.
Service Organization - Delta Computer Systems, Inc.

97-2. Finding
Several systems supplied by Delta allow edit and deletion of critical records. Land redemption,
purchasing, homestead exemption along with other systems require an unaltered numbered original to
ensure adequate internal control. Delta software packages can be used with or without prenumbered
original documents.
Recommendation
Processes that require original unaltered documents with a sequential preassigned number should be
modified to allow voiding but not edit or deletion. The counties using these systems should use
prenumbered originals.
PRENTISS COUNTY
Schedule of Findings
For the Year Ended September 30, 1997
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Service Organization=s Response
The application software is incapable of determining what type of paper is being used by the customer
thus incapable of assuring the use of prenumbered forms. The use of prenumbered forms should be
directed to the county, not Delta. As you note, Delta supports prenumbered forms. There is no more
we can do. If deletion of a critical record is allowed or occurs, the event is recorded in a log file for
most releases of the software and will be in full effect upon year 2000 upgrades.
B. Finding - Independent Auditor=s Report on Central Purchasing System, Inventory Control System and Purchase
Clerk Schedules
Inventory Control Clerk.
Finding
Section 7-7-211, Miss. Code Ann. (1972), gives the Office of the State Auditor the authority to
prescribe accounting systems. The Inventory Control Clerk did not maintain an accurate inventory or
adequate subsidiary records documenting the valuation and completeness of general fixed assets as
prescribed in the Mississippi County Financial Accounting Manual. Failure to establish and maintain
an inventory control system for the county=s fixed assets could result in a loss of public property.
Recommendation
The Inventory Control Clerk should establish adequate control procedures to ascertain the historical

and/or estimated cost of general fixed assets and to maintain accurate inventory records documenting
the valuation and completeness of general fixed assets.
Inventory Control Clerk=s Response
There must be more cooperation from other department managers in a constant effort if the duties of
adding/deleting and maintaining are to be performed in an accurate manner for documentation. Steps
to correct this matter have been started, but not completed.
C. Findings - Independent Auditor's Report on Compliance With State Laws and Regulations
Chancery Clerk.
1. Finding
Section 9-1-43, Miss. Code Ann. (1972), limits the annual compensation of Chancery Clerks to
$75,600 after making deductions for employee salaries and related salary expenses, and expenses
allowed as deductions by Schedule C of the Internal Revenue Code. A business expense must be both
ordinary and necessary to be deductible. During the 1997 calendar year, several expenses were
deducted against income that cannot be construed as either ordinary or necessary business expenses.
Adequate documentation, such as itemized invoices, was not provided for some expenses claimed as
Schedule C deductions.
PRENTISS COUNTY
Schedule of Findings
For the Year Ended September 30, 1997
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Recommendation
The Chancery Clerk should pay $4,913 for the disallowed expenses to the General Fund.
Chancery Clerk=s Response
Since the date of final payment to the retirement system, it has come to my attention that this is not an
allowable expense. Therefore, I am paying $2,622 to the General Fund. In January, 1998, the State
Auditor gave all clerks a more precise list of allowable expenses. Although not all inclusive, it should
help in identifying allowable expenses in the future.
Auditor=s Note
The Chancery Clerk paid $2,622 to the General Fund on August 10, 1998, as evidenced by receive
warrant number 3754. The Chancery Clerk paid an additional $2,291 to the General Fund on August

13, 1998, as evidenced by receive warrant number 3767.
Tax Collector.
2. Finding
Section 27-49-1, Miss. Code Ann. (1972), requires the Tax Collector to present to the Board of
Supervisors at its meeting on the first Monday of October in each year, a report of all insolvent and
delinquent taxpayers in the county, with the amount due from each. The required report was not
presented to the board.
Recommendation
The Tax Collector should present to the Board of Supervisors the report of insolvent and delinquent
taxpayers.
Tax Collector=s Response
I agree and understand this problem and will correct it.
PRENTISS COUNTY
Schedule of Findings
For the Year Ended September 30, 1997
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Circuit Clerk.
3. Finding
Section 9-1-43, Miss. Code Ann. (1972), gives the Office of the State Auditor the authority to
prescribe a uniform accounting method to account for the fees earned by the Circuit Clerk. The
following deviations from the prescribed accounting system were noted in the Circuit Clerk’s Office:
a. The fee journal was not properly prepared in that no withdrawals were listed and no
expenses were recorded in the fee journal even though some had been incurred.
b. The Circuit Clerk’s report that was filed with the Office of the State Auditor was not filled
out correctly in that disbursements were reported that had nothing to do with the Circuit
Clerk’s Office. They were business deductions of other business endeavors of the Circuit
Clerk.
c. The Circuit Clerk was not reconciling the bank statements to the fee journal.
Recommendation
The Circuit Clerk should prepare his fee journal in such a manner that it meets all the prescribed

criteria. He should properly reconcile the monthly bank statements and properly prepare the annual
report that is sent to the Office of the State Auditor.
Circuit Clerk’s Response
We will do whatever it takes to do the journal right.