Columbus – Auditor of State Keith Faber’s Office released the 2018-2019 financial audit of Harrison Township in Perry County. The audit included multiple findings including findings for recovery that totaled more than $18,000.
Late fees, penalties, and interest are not considered a proper public purpose to spend tax dollars. Dating back to 2004, the Township has a significant number of checks payable to the Treasurer of State for taxes which had not been mailed or remitted by the township. In a previous audit, the Township was issued and repaid a $6,671 finding for recovery for the interest and penalties accrued.
During 2018, according to supporting tax reports provided by the Township, the Township paid $9,510 and $15,740 in penalties and interest for late state taxes paid for the periods 2011 through 2016 and 2004 through 2010, respectively. Therefore, $18,579 in penalties and late fees have not yet been repaid to the Township for penalties and interest. Also, during 2018, the Township paid a total of $28 in interest for late remittance and filing of 2018 first, second, and third quarter state tax withholdings.
Additionally, the Fiscal Officer appears to have withheld the required state payroll taxes for both 2019 and 2018; however, there was no evidence they paid the taxes for 2019 or the fourth quarter of 2018, nor submitted the required annual reports as required by the State of Ohio.
Auditors also noted during 2018 that the Township paid $94 to the Ohio Public Employees Retirement System representing interest paid on late 2017 and 2018 remittances of pension withholdings. These payments do not constitute proper public purposes.
A finding for recovery was issued against Khristine Hanson, Fiscal Officer, and her bonding company, Travelers Casualty and Surety Company of America, in the amount of $18,701, in favor of the Township’s General Fund.
On December 9, 2020, the Township entered into a settlement agreement and payment plan with Hanson. She will make a payment of $1,451 in January 2021 and 23 monthly payments thereafter of $750.
Other findings included:
- Noncompliance and material weakness because no evidence of permanent appropriations adopted for 2019 and 2018 were noted;
- Noncompliance and material weakness for not certifying the total amount from all sources available for expenditures from each fund or obtaining a certificate of estimated resources from the Budget Commission for 2019 and 2018;
- Material weakness as a result of unexplained variances between the Township’s bank balances and the accounting records and failing to reconcile monthly increases. Adjustments, that management agreed to, were subsequently made to the financial statements;
- Material weakness because the small size of the Township did not allow for an adequate segregation of duties such as that the Fiscal Officer performed all accounting functions including receipting, depositing, disbursing and reconciling;
- Material weakness for the multiple financial statement and footnote adjustments;
- Noncompliance and significant deficiency because property tax receipts were not properly allocated correctly between the General Fund and Road and Bridge Fund;
- Noncompliance due to the township failing to remit federal income and Medicare taxes for employees during 2019 and 2018; and
- Noncompliance and significant deficiency for not maintaining underlying documentation and support for a certain electronic payment to the Ohio Attorney General.
A full copy of this report is available online.