Dare changes audit requirements for fire departments

Published 10:08 am Wednesday, January 31, 2024

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Dare County changed the audit requirements for volunteer fire departments.

Currently, Dare County requires nonprofits to have an annual audit if the county provides special district tax levies greater than $100,000 per year.

Finance director David Clawson reported that over the last two to three years, issues have emerged with cost, timeliness and inability to find auditors to perform the work.

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Dare County staff, with help from Potter & Company, Dowdy & Osborne, and Burgess, Lowman & Lay, researched an alternative, known as agreed upon procedures engagements.

For such a procedure, the nonprofit would annually contract with a CPA firm to perform certain procedures on a random sample of transactions from the fiscal year.

Also, NC S.L. 2012-169 requires any nonprofit receiving more than $5,000 in local, state or federal funds in a year to file an IRS Form 990. The form is essentially an annual financial statement, usually prepared by a tax preparer, reports the agenda item.

Dare County’s Audit Committee met on Dec. 5, 2023 to take up the issue. The committee recommended to retroactively change the county’s nonprofit policy for those receiving more than $100,000 per year to:

– Accept the IRS Form 990 as financial statements; and

– Require an annual agreed upon procedures engagement by a CPA firm, with the procedures to include: determine if bank reconciliations were completed for each month; review and test one bank reconciliation; test 25 randomly selected transactions, mainly disbursements, but to include at least one receipt/deposit, and if applicable, one payroll transaction. The performing firm will determine testing elements.

This change would eliminate the county audit requirement for certain volunteer fire departments: Avon, Buxton, Frisco, Hatteras, Colington, Roanoke Island (unless the Town of Manteo requires), and Rodanthe-Waves and Salvo known as Chicamacomico Banks Volunteer Fire and Rescue Department, and for the Hatteras Rescue Squad.

Community centers and Children & Youth Partnership have other (not county) audit requirements.

The commissioners unanimously authorized staff to change the county policy for nonprofit financial reporting, and to include those changes in future nonprofit contracts.

In the consent agenda, the commissioners agreed to six financial items:

– A contract with McGuire Woods Consulting to represent Dare County before the North Carolina General Assembly. The contract calls for $5,000 per month along with expenses from the first day of the 2024 General Assembly to the date of adjournment.

– To accept $76,711 to be used to purchase a mobile incident command trailer using a 100% federally funded Homeland Security Grant Program award from North Carolina Emergency Management for Dare County Emergency Management.

– To re-appropriate unspent endowment funds from the Outer Banks Community Foundation Charles Finch Gaddy Endowment grants to Parks and Recreation in prior fiscal years in the amount of $11,899 of the total $52,000.

– To credit $3,008 to the Children’s Environment Health Unit to addressing testing and remediation for lead in water and inspection and remediation for lead-based point and asbestos in public schools and licensed child care facilities. Funding will be used for staff to attend trainings to ensure compliance with state and federal regulations.

– To accept a mini-grant of $14,203 for the county’s Environment Health Unit for purchasing needed equipment and supplies to modernize service delivery and provide funds for certified facilitator training in three courses with True Colors International. The plan is for the certified trainer to offer these courses to health departments in Dare County and across the eastern region or the state.

– To lease for the county’s Public Health Division a 2023 Ford Turtle Top vehicle from PORT Health for three years at $1 per year.

In addition, NCDOT requested that Dare County Transportation update Title VI anti-discrimination plan to be in compliance with Federal Transit Administration requirements of updating the policy once every three years. The last policy update was signed on Dec. 7, 2020.

The plan was updated at the Dec. 4, 2023 meeting, but NCDOT has requested that additional contact information be added.

Dare’s commissioners appointed councilman Mark Batenic from Southern Shores and Terry Gray from Kill Devil Hills to the Dare County Tourism Board.

During his agenda time, county manager Robert L. Outten briefed the commissioners on the struggles in the Sanitation Department. Seven of 17 positions are unfilled or employees are out due to worker’s compensation claims.

Outten said the county is still behind the towns in salaries, even with the recent salary study. The department has started a training program for CDL licenses. Another option is to go with a private contractor. Board Chairman Robert L. Woodard suggested floating consolidation with the towns.