BEVERLY SHORES | A state audit of town financial records released this week outlines dozens of accounting errors and requests Beverly Shores Clerk-Treasurer Laura Sullivan repay more than $6,600 the town accrued in tax penalties.
The audit states the town did not maintain accounting records or reconcile bank statements, which means auditors were unable to verify cash balances or verify whether town financial statements were accurately reported.
The town incurred more than $4,800 in penalties and interest by the Internal Revenue Service for late payment and filing of federal withholding taxes. Similar charges by the state Department of Revenue totals more than $1,300. The audit reported more than $450 was owed in penalties and interest to Indiana Workforce Development for late payment of state unemployment tax.
In each case, auditors request Sullivan repay the town.
The audit goes on to say the clerk-treasurer did not properly maintain accounting records. Auditors report Sullivan was "unable to give us an understanding of the Towns system of recordkeeping and flow of transactions."
Auditors said Sullivan failed to update and close town records from October 2013 to August 2014. And bank statements were not reconciled from July 2013 to August 2014.
Auditors noted that although receipts area issued numerically by the computer, during January 2013, there were eight receipt numbers that were not accounted for. Auditors said there was no record of them being valid, voided or deleted.
Auditors also questioned payments that were recorded multiple times with the same check number, how checks generated by the town's software system cleared the bank but were never recorded in financial records and how checks that were voided in financial records were found to have cleared the bank.
The audit found payments to NIPSCO for the town's gas and electric service didn't match the bills the town received. The audit states the town is in arrears on those bills.
The audit also points out the town in 2012 paid $9,462 to various consultants for the clerk-treasurer to receive training and assistance in the operation of the financial software programs. It also states Sullivan requested additional assistance or training in 2013 in recording transactions and balancing funds and error correction. The council denied that request due to budget restraints.
Sullivan on Friday said she "feels horrible" about the audit.
"I wish I have could have done better," she said. "I did the best I could."
Sullivan said she will pay the interest and penalties incurred by the town.
"I was not suited for this job, and this job was not suited to me," she said.
Town officials on Wednesday announced that Sullivan was resigning from her position as of Dec. 31 and Jon Voelz was appointed her successor.
A copy of the report was forwarded to the Indiana Attorney General and the Porter County prosecutor. No charges have been filed.