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COMMISSIONERS' COURT AGENDA REQUEST
PLEASE FURNISH ONE ORIGINAL AND TEN (10) COPIES OF THIS
REQUEST AND DOCUMENTS TO BE REVIEWED BY THE COURT
MADE BY: Paula J. Hargis OFFICE: County Auditor
MEETING DATE: January 28, 2008 TIME PREFERRED:
SUBJECT: Presentation of audits on the following departments:
1.	Tax Assessor Collector
2.	ESD No. 2
3.	Mountain Home VFD
4.	County Clerk
5.	District Clerk
EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON)
NAME OF PERSON ADDRESSING THE COURT: Paula J. Hargis
ESTIMATED LENGTH OF PRESENTATION: 10 Minutes
IF PERSONNEL MATTER -NAME OF EMPLOYEE:
Time for submitting this request for Court to assure that the matter is posted in
accordance with Title 5, Chapter 551 and 552, Government Code, is as follows:
Meeting scheduled for Mondays
THIS REQUEST RECEIVED BY:
THIS REQUEST RECEIVED ON:
5:00 PM previous Tuesday
@ .M.
All Agenda Requests will be screened by the County Judge's Office to determine if adequate
information has been prepared for the Court's formal consideration and action at time of Court
Meetings. Your cooperation will be appreciated and contribute towards your request being
addressed at the earliest opportunity. See Agenda Request Rules Adopted by Commissioners'
Court.
Audit of T~ Collect's Office
To: Jeannie Hargis, Kerr County Auditor
From: Kenneth Ruark
Date: 11/15/2007
Audit Period 9/1/2007-10/31/2007
Background
The main duties of the Kerr County Tax Collector's office are to send tax statements and collect
property taxes for Kerr County and process tax, title and licenses for motor vehicles for the State
of Texas. The Tax, Title and Licenses section uses a Texas State software program and receives
a fee from the state for collecting the taxes. The Property Tax section uses another software
program to process tax receipts for the county and various other taxing authorities. Both
systems are balanced daily and deposits are made daily for the funds collected. The Tax
Collector's Office has 13 employees with and annual budget of $617,000 and operates a
substation office in Ingram.
Audit Scope
This audit was a review of procedures and controls for cash processing for both property taxes
and motor vehicle tax titles and licenses. It is the opinion of the auditor that the procedures and
controls in place protect the assets of the County. The audit findings and recommendations listed
below offer an improvement of physical security at the Ingram Substation office.
Audit Findings
Ingram Substation Physical Security
The Ingram Substation office lacks the physical office security to protect both the cash collected
and the employee from criminal activity. The substation office has one employee and averages
over $10,000 in daily receipts, with cash comprising approximately 20% of the daily funds
collected. There is no physical security for the employee in performing her duties. The office is
open to anyone that enters with only a low counter separating the employee from the general
public. The office does not have a panic button or glass partitions for protection of the clerk and
the cash collected. There is a safe in the office that valuables are locked in overnight at the
conclusion of business.
Audit Recommendations
It is recommended that the Kerr County Tax Collector along with the County Sheriff review the
physical security of this office and make recommendations for improvements. Consideration
should be given to implementing some system that separates the employee from the general
public while still providing the necessary services.
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Audit of ESD #2
To: Jeannie Hargis, Kerr County Auditor
From: Kenneth Ruark
Date: 1 /7/2008
Audit Period 10/1/2006-9/30/2007
Background
The Kerr County Emergency Services District No. 2 was established November 4, 2003 by
majority vote of the qualified voters of Kerr County owning taxable real property within the
boundaries of the District and was so constituted by the Commissioner's Court of Kerr County,
pursuant to the Texas Health and Safety Code, Chapter 775. The purpose of the District through
its authority is to provide stable funding to assure the communities within its boundaries the
resources to support fire prevention, fire fighting and other emergency services. The annual
budget of the district is $24,000.
e~rr-' The District entered into a contract with the Mountain Home Volunteer Fire Department to
provide fire prevention, fire suppression and other services normally provided by a fire
department to the District. In return, the District agreed to provide the Volunteer Fire
Department funds as negotiated for the purpose of performing the services as provided in the
contract.
Audit Scope and Conclusion
The audit scope consisted of a review of the internal controls for cash receipts and disbursements
for the audit period. No discrepancies or audit concerns were noted for the audit period.
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Audit ofMotmtainHoine VohuFire Dn~rt
To: Jeannie Hargis, Kerr County Auditor
From: Kenneth Ruark
Date: 1/7/2008
Audit Period 1/1/2007-11/30/2007
Background
The Mountain Home Volunteer Fire Department serves the community of Mountain Home and
the surrounding area. There are 29 volunteer firemen with six emergency vehicles. The
Mountain Home Fire Department has contracted with Emergency Services District #2 to provide
fire protection services and in return EDS #2 is to provide funding to help operate the fire
department. The Mountain Home Volunteer Fire Department receives $13,000 in Kerr County
tax funds in addition to the funds provided by EDS #2. Fundraisers and donations also provide
other funding for the fire department. The MHVFD 2007 operating budget was $41,000.
Audit Scope
The audit scope consisted of a review of the internal controls for cash receipts and disbursements
for the audit period.
Audit Findings
1. Certificate of Account Status -Incorporation Status
MHVFD had not filed the proper forms with the State of Texas to keep the Franchise Tax
Account Certification in good standing for a period of years. The failure to file the proper forms
invalidates the incorporation charter that was given in 1983 and subjects the MHVFD legal
standing as a tax exempt corporation and their ability to claim sales tax exemption for purchases
of equipment.
2. Bank Account Reconciliation
The bank statements were not reconciled on a consistent basis. The last bank reconciliation was
completed in May 2007. One debit transaction posted to the bank account in August 2007 for
$35.00 was believed to be incorrect and did not belong to the MHVFD.
3. Debit Cards
Several debit card transactions were posted to the checking account for the audit period. It was
noted by the Treasurer that several members of the fire department had debit cards. There were
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no written policies for controlling the use of the debit cards by members of the fire department.
No significant purchases had been made by any fire department personnel during the audit
period with the debit cards.
Actions Taken
1. The Treasure of MHVFD has taken the necessary action to obtain a Certificate in Good
Standing with the Texas Secretary of State. This matter should be concluded shortly.
2. The Treasurer has agreed to begin reconciling the monthly bank statement on a consistent
basis and to resolve disputed items with the bank.
3. The Treasurer will address the use of Debit Cards at the next MHVFD Board of Directors
meeting and will recommend policies for the use of the debit cards.
Conclusion
The Mountain Home Volunteer Fire Department maintains adequate books of records and with
the exception of the items noted above have no other audit or accounting issues of concerns.
Page 2 of 2
Audit of C'ourlty Clam's Once
To: Jeannie Hargis, Kerr County Auditor
From: Kenneth Ruark
Date: 1/23/2008
Audit Period 10/1/2007-12/31/2007
Background
The County Clerk's duties are to ensure safekeeping of the official Kerr County
records. These documents include the official proceedings of the Kerr County
Commissioners Court, County Court and County Court at Law. Filings are
maintained for real and personal property records, livestock marks and brands
and beer licenses. Other responsibilities include recording and issuing vital
records for births, deaths and marriages. The County Clerk is also responsible
for conducting countywide special and general elections.
The County Clerks office has a staff of 15 with an annual budget of
approximately $800,000.
Audit Scope and Conclusion
This audit was a review of procedures and controls for cash processing for the
various duties of the County Clerk. It included a review of monthly report
preparation to the Commissioner's Court and the transfer of funds to the
Treasurer's office. It is the opinion of the auditor that the procedures and
controls in place conform to standard accounting practices and protect the assets
of Kerr County.
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Audit of DisbrictCl~Office
To: Jeannie Hargis, Kerr County Auditor
From: Kenneth Ruark
Date: 12/ 10/2007
Audit Period 9/30/2007-11/26/2007
Background
The District Clerk's duties are to ensure that the affairs of the district courts are maintained
objectively with the full confidence of judicial authorities.
The Texas Government Code states the duties and powers of the clerk of the district court: "The
clerk of the District Court has custody of and shall carefully maintain and arrange the records
relating to or lawfully deposited in the clerk's office." The district clerk shall:
• Record the acts and proceedings of the district court;
• Enter all judgments of the court under the direction of the judge;
• Record all executions issued and the returns issued on the executions;
• Process passport applications;
• Administer child support payments;
• Administer trust accounts for minors ordered by the courts;
• Keep an index of the parties to all suits filed in the court, and make reference to any
judgment made in the case; and
• Keep an account of all funds collected by the office, by way of fines and fees, and the
amount due jurors in district court for service.
Audit Scope and Conclusion
This audit was a review of procedures and controls for cash processing for the various duties of
the District Clerk. It is the opinion of the auditor that the procedures and controls in place
conform to standard accounting practices and protect the assets of Kerr County.
Productivity Improvements
During the course of the audit, productivity improvements involving the balancing of the District
Clerk's checking account were recommended. A financial checking account package and the use
of Microsoft Excel were in the process of being implemented at the conclusion of the audit.
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