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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

Bethpage Water District – Internal Controls Over Financial Operations (2012M-003)


Released: March 2, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to review the internal controls over the District’s financial operations for the period January 1, 2010 to October 20, 2011.

Background

The Bethpage Water District is located in the Towns of Hempstead and Oyster Bay, in Nassau County. The District is governed by an elected three-member Board of Commissioners, consisting of a Chairman, a Secretary, and a Treasurer. The District’s total revenues for the 2010 fiscal year were $6 million, which were primarily generated from water usage charges and real property taxes. The District’s 2010 expenses totaled $3.9 million.

Key Finding

  • One of the banks in which the District maintains a substantial cash balance changed its policy in April 2011, so that the fees charged exceeded interest paid. For example, in April 2011, the District earned interest of $86.14 on its operating account; however the Bank charged the District $409.50 in fees resulting in a loss of $363.36 for the month. Upon learning of this policy change, District officials immediately researched alternative institutions to deposit their funds. District officials have not yet chosen a new Bank.

Key Recommendation

  • Assess the results of its research and move the District’s moneys to an institution where the service fees charged will not exceed the interest earned on its investments.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236