Douglas daily dispatch., 1927-01-25
IRRECULARIT
SHOWN IN ROAD
E'XPEND
Department Audit Shows
Deficit OF $1,2O9, ,342.W
Dec. 81. 1922.

PHOENIX, Jan. 24.-P-Irregulari-
ties in the disbursement of funds by
the state highway department prior to
December 81, 1922, leading to a deficit
of $780, ,342.77, are allaged in an audit
made by Chicago firm of certified
accountants transmitted to the eighth
legislature by Governor Hunt today in
conformity with a senate resolution
adopted last Friday.
The audit covers five and one-half
years, and was prepared at a cost of
S5O,OOO, as ordered by the sixth legis-
lature.
Total liabilities on December 81,
1922. were in excess of the department
available resources by that amount
the audit shows, and in determining
the deficit all federal aid was taken
into consideration as we'll as future
tax levies and miscellaneous sources
being considered as applicable to fu-
ture operations.
In the payroll bank account, known
as state Engineer J. II. Allen, Bank
Account number of unexplained de-
DOSlLS were IuduSy OChS1 IietAi ~
for payrolls; and payments were made
therefrom in the sum of S9,352.O4, Tor
which no explanation was furnished.
This amount, together with unauthor-
lied payments from the 'imprest fund'
aggregating S10,41S.53, which were
made to, employees of the department
and others for no recorded considera-
ton, and $3,S8676 expended for mis-
cellaneous purchases and expenses
which were not authorized and for
which no claims have been made,
makes total of unauthorized expendi-
| lures of $23,72O3S, according to the
audit.
i The "imprest fund" was established
! TO enable the state engineer to expe-
dite the payment of current bills and
ipayrolls, such payments to be returned
to the fund on properly authorized
claims.
The fund appears to have been es-
/ tablished at $4,000 and Increased to
$4,000 by the legislature in 1919.
The auditors report the 'imprest
fund bank account" has exceeded both
the amount permitted under the act
by which the fund was authorized and
the amount VI IllS oCCtS NAAeoA
surety bond It continues:
"In certain cases state approprla-
tions and county aid funds approprl-
ated Or contributed for specific PROV
ects have been expended for entirely
different purposes.
"In numerous instances books, rec
! ords and documents, reference to whicf
! was essential for a complete account
ling of the transactions of the depart
4 ment, were missing or not producec
for our inspection. The missing files
! and records in some cases covered
I many months or periods of years.
I. .The system of accounting in the
I department was entirely, inadequate
/ for it's requirements. The records die
.lnot conform to any standard basis OF
outline of accounting. They were in
! complete and did not furnish either the
I accounts or the information necessary
i to disclose the financial transactions
of the department in a manner Whlcf
would permit of the preparation OF
periodical statements of it's operations
= or Of it's resources and liabilities.
"The examination of the charges fol
:! cement for the period of Is months
j ohQeQ December AJGG' lHNiNeSNSN
!; that various purchases consigned ant
/ charged to specific projects were di
verted to other projects, without Civ
: ing effect to transfers on the books
IAlso shipments consigned to and un
'iIoaded at Phoenix were charged tt
projects many miles distant
The report adds that the impres
4 fund books, records and files were
4 missing for the two years from July
i, 1920, to June 80, 1922, with the ex
\ Iception of the check stubs and in addl
tion camp construction records, fielt
Ipayroll checks and time books were
missing from certain projects.