Auditor to turn part of Elliott County clerk’s report over to AG, others

Harmon details repeat findings he says are of concern

ELLIOTT COUNTY, Ky. (WTVQ) – State Auditor Mike Harmon said Thursday he will refer part of the audit of the Elliott County Clerk’s Office to the Attorney General, Kentucky Department of Revenue, and the Department for Local Government for further investigation.

Ther referral is part of broader findings Harmon’s office cited in the annual audit (click to read report 2019ElliottFEC-PR) of Clerk Jennifer Carter’s office, which he said included several repeat findings.

The audit contains the following comments:

According to Harmon, the county clerk is not fulfilling her duties as an elected county official, which he called a repeat finding that was included in the prior year audit report. He noted the following findings:
• The county clerk’s office lacks adequate segregation of duties and internal controls over fee receipts and disbursements

• The county clerk did not comply with the county’s fee pooling ordinance
• The county clerk did not submit quarterly reports to the Department for Local Government
(DLG)
• The county clerk did not present an annual settlement to the fiscal court
• The county clerk did not pay delinquent taxes to districts timely
• The county clerk did not remit affordable housing payments to the state timely
• The county clerk did not remit legal process tax payments to the state timely
• The county clerk did not properly account for usage tax collections
• The county clerk owes ad valorem taxes to taxing districts in the amount of $106,115
• The county clerk did not pay license fees timely and owes $7,331 to the state
• The county clerk did not prepare all franchise tax bills
• The county clerk has not settled the 2017 fee account
• The county clerk has not settled the 2018 Fee Account

Harmon went on to say:

— The county clerk does not devote sufficient time to financial reporting and has not implemented policies and procedures to ensure all financial activity is compiled and reported timely. Additionally, the county clerk has failed to implement policies and procedures to ensure taxes are distributed to taxing districts timely. The county clerk is in violation of many statutes that govern fee office operations. Most importantly, taxing districts (state, county, school, library, health department, extension district, conservation, etc.) are owed substantial amounts of taxes and have been deprived of these resources for a significant time, he said.

KRS 68.210 gives the state local finance officer authority to prescribe a uniform system of accounts, which sets certain minimum accounting requirements for local officials. It is the statutory duty of the county clerk to collect and distribute motor vehicle taxes, delinquent taxes, and various taxes/fees on legal instruments. There are numerous statutes that outline the duties and responsibilities of the county clerk.

“We recommend the county clerk take immediate action to remedy the issues outlined in these comments and recommendations. Further, we recommend the county clerk implement policies and procedures for her office to ensure these issues are corrected for future periods. This matter will be referred to the Office of the Attorney General (OAG), Kentucky Department of Revenue, , and
the Department for Local Government (DLG),” he said.

In a response, Carter wrote: “With our limited ability to hire help we face a near impossible task of keeping all departments reporting and payments current.”