Galloway makes recommendations to improve oversight in Lexington municipal court

Wednesday, April 19, 2017

The Lexington municipal court was recently audited by Missouri State Auditor Nicole Galloway, and her office has now released its findings.

The audit was initiated through the petition process, which required 312 signatures, and raised several concerns, including oversight in the court as one employee serves as both the court clerk and the city of Lexington’s city clerk.

“Government at all levels must be accountable to the citizens it serves and that requires safeguards to ensure taxpayer dollars are managed wisely,” Auditor Galloway said in the report. “In cases where employees are responsible for managing multiple roles, other court or city personnel should review certain documents or work products to ensure accuracy and to safeguard against errors.”

In cases where two signatures are required, such as checks written from court accounts, the clerk was signing the check and then using a signature stamp for the second signature. This eliminated the benefit of requiring two signatures on a check. Similar concerns were identified for bond forfeiture documents, where the clerk applies the prosecutor’s signature by using a signature stamp.

The scope of the audit included, but was not necessarily limited to, the year ending March 31, 2016. According to the audit, the objectives were to (1) evaluate the municipal division’s internal controls over significant financial functions, (2) evaluate the municipal division’s and city’s compliance with certain legal provisions, (3) evaluate the municipal division’s compliance with certain court rules, and (4) evaluate the city’s compliance with state laws restricting the amount of certain court revenues that may be retained.

The audit identified (1) deficiencies in internal controls, (2) noncompliance with legal provisions, (3) no significant noncompliance with court rules, and (4) no significant noncompliance with state laws restricting the amount of certain court revenues that may be retained

According to the audit, accounting controls and procedures need improvement. During the year ending March 31, 2016, the municipal division collected approximately $54,000 in fines, court costs and bonds.

“The municipal division has not adequately segregated accounting and record-keeping duties and neither the Municipal Judge nor city personnel perform supervisory or independent reviews of municipal division accounting functions and records,” the report stated.

Similar concerns were identified for bond forfeiture documents, where the clerk applies the prosecutor’s signature by using a signature stamp.

The auditor’s office recommended that the city of Lexington ensure that documented independent or supervisory reviews of municipal division accounting records are periodically performed and establish controls over the use of signature stamps.

Since the time of the audit, city and court officials have reportedly made changes to correct the problems.

According to the auditor’s official report, the Lexington City Administrator is now reviewing court bank statements and bank reconciliations. The administrator will also assign someone to compare case dockets to case information to ensure accuracy. In addition, a new procedure has been implemented to have all check signers review and initial the court clerk’s use of their signature stamps. In addition, on a monthly basis the prosecuting attorney will review bond forfeitures and related checks when the Prosecuting Attorney signature stamp has been used.

The audit also found a lack of accountability for traffic tickets issued by the police department. The audit recommends the court and police department work together to account for all tickets issued to ensure the tickets and associated payments are properly handled. This would include making sure official pre-numbered bond forms are issued, the numerical sequence of all bond forms is accounted for, a bond log is maintained to record all bonds received, and bond receipts are recorded and transmitted timely to the municipal division. It was also recommended that the court retain the monthly lists of bond liabilities, reconcile the lists to the reconciled bank balance, and promptly investigate and resolve differences.

According to additional comments within the audit, the Lexington Police Department is now using pre-numbered bond forms. A log is being kept by the police clerk, and reviewed monthly by the court clerk, to ensure the numerical sequence of all bonds is accounted for and to ensure bonds are recorded and transmitted in a timely fashion. The court clerk also will retain the monthly lists of bond liabilities and reconcile the lists to the reconciled bank balance monthly.

The audit of the Fifteenth Judicial Circuit, City of Lexington, referenced above, reported an overall performance rating of “good.” A petition audit of the city of Lexington is in progress, and additional findings and recommendations will be included in a subsequent report.

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