The Wyandotte herald. (Wyandotte, Mich.) 1879-1943, 1942-08-14
THE CITY COUNCIL

WyandOtte, Mich, Aug. 5, 1912.

pm, Tor the purpose OF CONSTRUCTING
the report of Ernst and Ernst, Ac-
cOuntants and Auditors, as TO the dis
crepancies in the accounts Of Treasur-
er Of the City Of WyandOtte.
George Z. Benin
Louis BrOhl, Sr.
Clifford T. Burke
James Ii. Mason
Ford Wagar
Reading Of Reports of Ernst and
Ernst.
City Council of the City Of WyandOtte
WyandOtte, Michigan
Gentlemen:
Pursuant, to your resolution OF July
Il, 1912, We have made preliminary
examination Of the records pertaining
TO cash transactions cOIsummated in
the office Of the City Treasury from
October /, 1871 TO July u, 1912, and
for prior periods with respect 10 GER
tain types Of transactions. Such ex-
animation indicates that certain re-
venues, particularly those arising from
the operation Of the City Hospital and
from delinquent tax collections have
not been properly accounted for and
that the misapplicatiOn Of funds has
continued at least June, 1910.
In view Of the conditions indicated,
We recommend that our examination
be extended to cover the period from
October /, 1899 10 July 81, 1912 along
The following lines:
a. Examination Of the recorded
cash receipts in the office Of the City
Treasurer for the period, as 10 pro-
priety Of source, and recOncilement
thereof, with deposits in the various
city depository accounts as Indicated
by the bank statements OH file Or BY
the bank records. This procedure
would include direct confirmation Of
certain types of revenues by cOmmuni-
cation with the diSbursing agencies
and recOncilement of recorded depart
mental revenues with the related re-
cords Of the originating departments.
1t does not appear necessary, for the
purpose Of determining the extent of
the discrepancies, to examine detailed
records underlying collections made
by departments Otuer than the City
Treasurer.
o. Summarize ton of tax levieS
CITY, School and County, for each of
the years 1899, 1910 and 1911 and re-
cOncilement thereof with the recorded
collections and the amounts returned
delinquent, as well as tests Of items
currently unpaid by direct cOmmuni-
cation with the related property own
ers. (ThiS test may he restricted by
the unaVailability of names and adj
dresses Of property owners and should
not, in most instances, include tax
items for less than $1,000.
90 ACKNOWLEDGMENT Of the recorded
cab disbursements for the period, in
aggregate monthly or annual totals,
with the charges 10 the related bank
statements, and scrutiny Of inter-fund
or inter-departmental transfers. In ad-
ditiOn, some examination should be
made Of detailed records, apprOvals,
ETC., underlying the recorded cash dis
bursementS, although this may well be
limited to tests of selected months un-
less irregularities are disclosed by the
tests.
Attention is directed to the fact
that the examination herein cOntem-
plated relates exclusively TO the cash
transactions handled in the office of
the City Treasurer and does not in
clude tests of departmental cash
transactions or review of asset. liza
bility and operating accounts for the
purpose Of expressing an opinion OH
the financial statements of the city.
The foregoing program does not spe-
officially contemplate an examination
Of the records maintained by the City
Treasurer in his capacity as treasurer
Of the Board Of Education. ON the as
sumption that such examination will
he made by the accountant for the
Board Of Education. However, in view
OF the apparent intermingling Of funds
we may find it desirable 10 make q
limited eXamina ton of such records.
In addition TO the examination here
in proposed, we would assist the city
ali preparing claims against the bond
ing company and would cooperate in
the accumulation Of data required by
the Prosecuting Attorney. We would
review the City's general accounting
procedures and the system of internal
control exercised with respect to city
funds handled by the Treasurer, with
view to recommending reyisions
therein to safeguard against possible
future Irregularities.
We propose to undertake the work
outlined on the basis Of our per diem
rates FOR the time required. such rates
being 5000 for supervising account
ants. $1,000 for senior accountants and
5000 for Junior accountants. plus
necessary transportation expenses and
other direct cash Otlay.
Very truly yours.
A. L. Barrett, Resident Partner
Ernst and Ernst,
Accountants and Auditors.
Detroit, Michigan
City Council Of the City Of WyandOtte
WyandOtte, Michigan
Gentlemen:
The preliminary Investigations
which we have made into the records
OF the Treasurer Of the CITY of Wv
andOtte Indicate discrepancies i'm the
accounts TO the extent of So4116 3o
which occurred between June d JolO
and July u, 1912. In order that Won
may be informed of the status of TIA
investigation prior TO the completion
Of our work. we have summarized the
discrepancies thus far disclosed as
Delinquent tax remittances received
from the Wayne County Treasurer
and deposited to other accounts (prin.
f.ina1V the Wvandot+1