Elected Tax Collectors Summary Audit Report

Transcription

1 Audit Report For the period of January 1, 2017 through January 15, 2018 covering the 2017 tax year Brian K. Hurter, CPA Lancaster County Controller

2 Audit For the period of January 1, 2017 through January 15, 2018 covering the 2017 tax year TABLE OF CONTENTS Page(s) Audit Letter to Lancaster County Board of Commissioners List of Elected Tax Collectors for Relevant Audit Notes 2-3 Audit Findings and Observations 4-5 Audit Summary of Facts 6 Exhibit A: Financial Statement of 2017 Tax Duplicate Collections 7

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4 List of Elected Tax Collectors List of Elected Tax Collectors for 2017 Tax Year: 1. Adamstown Borough Rosemary Johnston 2. Akron Borough Ann S. Nolt 3. Bart Township John E. Martin 4. Brecknock Township Nancy J. Kulp 5. Clay Township Deb Zerbe 6. Colerain Township Anna W. Thompson 7. Columbia Borough Borough of Columbia 8. Drumore Township Linda S. Martin 9. East Cocalico Township Joan K. Fischer 10. East Drumore Township Martha E. Delong 11. East Earl Township Sally Usner/East Earl Township 12. Eden Township Gary J. Crawford 13. Fulton Township Margaret G. Gordon 14. Lititz Borough Jeannie A. Nearhoof 15. Little Britain Township Agnes Reeder 16. Manheim Township Patricia J. Kabel 17. Millersville Borough Ed Arnold/Millersville Borough 18. Mount Joy Borough Scott Hershey 19. New Holland Borough J. Richard Fulcher/New Holland Borough 20. Rapho Township Melva J. Kready 21. Sadsbury Township Stacey L. Hoopes* 22. Salisbury Township Kirsten J. Peachey 23. Strasburg Borough Lisa M. Boyd 24. Warwick Township Lynn Reapsome 25. West Earl Township Teresa Peachey * Any findings for tax collector for the 2017 tax year are not included in this report 1

5 Relevant Audit Notes Note A DESCRIPTION OF TAX COLLECTORS AND TAXING DISTRICTS The Elected Tax Collectors, mentioned on page 1, were elected to his or her position on or about November 5, 2013, to take office on January 1, Each elected tax collector s position is a four-year term. In Lancaster County, elected or appointed tax collectors are responsible to collect real estate taxes for the County and municipalities. According to Section 25 of the Local Tax Collection Law, by the tenth day of the immediate following month, the tax collector is required to submit a tax collector report approved by the Department of Community and Economic Development (DCED) and all monies collected in the prior month to the Lancaster County Treasurer and the municipality in which they are elected. When settlement of tax records is completed by January 15 of the subsequent year, the tax collector submits unpaid tax parcels to the Lancaster County Tax Claim Bureau. For 2017, there were 25 Elected Tax Collectors collecting for 25 taxing districts. Lancaster County is comprised of 60 taxing districts. The 25 Elected Tax Collectors collected $44,163, of County real estate taxes in Additionally, for the 2017 tax year, the 25 Elected Tax Collectors are responsible for collecting a total of 69,715 taxable parcels. Lancaster County is comprised of 184,628 taxable parcels. Note B SCOPE AND PROCEDURES OF AUDIT The period of review is January 1, 2017 through January 15, 2018, which covers the 2017 tax year. The following procedures were performed during the audit: Ensure DCED, Monthly Ledger Report or Distribution Summary Report is submitted monthly Ensure accurate commissions were paid to tax collector Ensure monies due to Lancaster County were properly receipted Ensure Lancaster County received the correct amount owed Ensure collections were properly paid in correct payment period Ensure correct number of parcels were sent to Tax Claim Bureau 2

6 Relevant Audit Notes (Continued) Note C EXCLUSION OF SADSBURY TOWNSHIP FROM SUMMARY REPORT Certain concerns were brought to the attention of the Lancaster County Controller s Office relating to the 2017 tax year for Sadsbury Township. These concerns required further investigation before issuing an audit report to the elected tax collector and that audit investigation is still ongoing. Therefore, the Lancaster County Controller s did not include any of the findings in this audit report. The financial statement summaries, however, do include Sadsbury Township figures. Note D TAX COLLECTION SYSTEM For tax collection purposes, the County of Lancaster utilizes DEVNET as the tax collection software. The Lancaster County Treasurer s Office requests the elected tax collectors to use DEVNET or another software of his or her choosing to record the collection of real estate taxes. All but one elected tax collector chose to utilize DEVNET for tax collections. 3

7 Audit Findings and Observations This section of the report presents the findings that resulted from our annual examination of the financial records. Lancaster County provides taxpayers with a 2% discount until April 30 and allows base collections from May 1 through June 30 of each year so that Lancaster County can use the tax dollars to best serve the residents of Lancaster County as a whole. Any payment received after June 30 until tax settlement is charged a 10% penalty. In Note B, we listed six procedures that were developed so that we could obtain a reasonable understanding as to whether the tax collections were free of material misstatement and to determine the accuracy of the timeliness of the County real estate taxes collected. Below we list the six procedures, and we include the taxing districts which had a finding or observation for that procedure, if any. More detail on each finding or observation is located in the individual audit report for that taxing district. Procedure 1: Ensure DCED, Monthly Ledger Report or Distribution Summary Report is submitted monthly During 2017, East Drumore Township failed to submit at least one Monthly Ledger Report or Distribution Summary Report to the Lancaster County Treasurer s Office. Procedure 2: Ensure accurate commissions were paid to tax collector All elected tax collectors included in this report were in compliance with this section. Procedure 3: Ensure monies due to Lancaster County were properly receipted All elected tax collectors included in this report were in compliance with this section. Procedure 4: Ensure Lancaster County received the correct amount owed During 2017, East Earl Township underpaid the amount due to the County of Lancaster and Colerain Township overpaid the amount due to the County of Lancaster. 4

8 Audit Findings and Observations (Continued) Procedure 5: Ensure tax bills were properly paid in the correct payment period During 2017 the following taxing districts reported collections outside of the correct period: Bart Township, Columbia Borough, Drumore Township, East Cocalico Township, Manheim Township, Millersville Borough and Warwick Township. Procedure 6: Ensure correct number of parcels were sent to Tax Claim Bureau All elected tax collectors included in this report were in compliance with this section. 5

9 Audit Summary of Facts We have performed the procedures explained in Note B to assist in evaluating compliance for the 2017 tax year ending January 15, 2018 for the Elected Tax Collectors included in this report. Our procedures described follow specific requirements of the Local Tax Collection Law. The purpose of this audit is to ensure our compliance with Section 26 (b) (1) of the Local Tax Collection Law. The Local Tax Collection Law contains guidance and procedures for the elected tax collectors. Reportable conditions involved issues coming to our attention relating to significant deficiencies or non-compliance that could adversely affect the tax collector s ability to show a true representation of the monies collected. While conducting our audit, we found findings, observations, and issues of non-compliance which are listed in the Audit Findings and Observations section above, and further described in each tax collector s audit report. None of the findings or observations mentioned in this report led us to believe that significant deficiencies had occurred. We conducted our tax collector audits to obtain a reasonable understanding about whether the tax collections are free of material misstatement and to determine the accuracy of the timeliness of the County real estate taxes collected. The financial affairs and compliance with the applicable law are the responsibility of the Elected Tax Collectors. Except for the exclusion of a tax collector from this report, as mentioned in Note C, it is our opinion that the taxes collected by the tax collectors included in this report appear properly collected, accounted for, and remitted to Lancaster County in a timely manner. It is also our opinion that the tax collections by the tax collectors included in this report appear to be in compliance with those generally accepted policies and procedures for tax collectors. We further believe the monthly tax balances recorded on the tax collection reports are accurately stated. It is our conclusion that all of the aforementioned findings, observations, and issues of noncompliance do not adversely affect any tax collector s representation of the monies collected and the issues noted seem to be minimal. The tax monies collected for the 2017 tax year are shown in Exhibit A. 6

10 Exhibit A SUMMARY DUPLICATE TAX COLLECTIONS Month Prev Balance Excess/Refunds Exons Disc Disc Base Pnlty Penalty Total Tax Rcvd Ending Balance If Base JANUARY $ 2,873, $ 3, $ $ 3, $ 2,870, $ 3, FEBRUARY 45,440, , ,032, , ,972, ,405, ,032, MARCH 42,405, , ,485, , ,376, ,917, ,486, APRIL 36,917, , , ,563, , ,012, ,348, ,563, MAY 9,348, ,718, , , ,177, ,077, ,271, JUNE 4,077, , ,800, ,802, ,274, ,802, JULY 2,274, , , , , , , ,384, , AUGUST 1,384, , , , , ,208, , SEPTEMBER 1,208, , , , , ,114, , OCTOBER 1,114, , , , ,056, , NOVEMBER 1,056, , , , , , , , DECEMBER 805, , , , , , End of Year 602, , , , , , TOTAL $ 27, $ 38, $ 40,801, $ 816, $ 3,107, $ 973, $ 97, $ 44,163, $ 546, $ 44,882, % 6.84% 2.14% 97.19% 98.77% Discount Period - paid by April 30th Base Period - paid by June 30th Penalty Period - paid after June 30th Key: Red Bold= Amounts collected outside of correct period 7