Fulton County

Northville Library changes policies after critical audit

An audit released Wednesday by the state Comptroller’s Office recommended broad reforms in the North

An audit released Wednesday by the state Comptroller’s Office recommended broad reforms in the Northville Public Library’s cash disbursement policies in light of, among other things, the undocumented spending of about $37,000 by the library’s director.

The audit, which looked specifically at cash disbursement activity from July 1, 2013, through Oct. 31, 2014, found that the library’s board of directors had been approving expenses after payment, rather than before, as required by law.

In a review of 365 claims totaling $212,327 in expenses, the audit found the board regularly approved a list of vendors and payment amounts without supporting information at its monthly meeting after the treasurer had already made the payments.

The audit also noted that the library’s director, Michael S. Burnett, had sole access to two of the library’s eight bank accounts, from which he withdrew more than $37,000 without audit or authorization from the board, and without recording the withdrawals in the accounting records.

A footnote in the audit notes that the money was used to purchase money orders for debt service payments, library materials, credit card balances and library performances. Elsewhere, it says the expenses included “services such as landscaping and magician performances.”

Burnett on Wednesday declined to elaborate on the expenses, deferring to the library’s response to the audit as its official statement.

In the response, dated July 17, board of trustees President Janis Serfis said the board knew about and approved of the director’s withdrawals.

“The director withdrew and used those funds with our implicit approval and understanding that said withdrawals were necessary for the operation and services of the library,” she wrote.

The audit warns, however, that the practice opens the door to “increased risk that library funds could be used for unauthorized or invalid purposes and not be detected.”

The same goes for the practice of approving expenses after the fact and with insufficiently detailed documentation, as well as the library allowing third-party service providers to automatically deduct funds from library accounts for things like retirement contributions, phone bills and utility services.

The audit notes that both the treasurer and director said they were not aware that service providers were not allowed to make direct withdrawals from the library’s accounts.

Following the comptroller’s recommendations, the library’s board of directors established an audit committee to approve all payments and claims, discontinued all third-party access to its accounts, and tightened its record-keeping policies, among other reforms, as of June.

The library is part of the Northville Central School District and serves about 3,000 residents, according to the audit. Its total budget for the 2014-15 fiscal year was about $153,000.

Despite disputing the audit’s claim that the director’s expenses were unauthorized, the board seems to have complied with each of its seven recommendations.

In her response to the audit, Serfis said it would “assist the board of trustees in its continual efforts to diligently protect the assets of the library, which in turn allows the provision of excellent library services consistent with the best use of taxpayer funds.”

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