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OFFICE OF THE DISTRICT OF
|Check Number||Date on Check||Check Made Payable To||Amount of Check||Purpose of the Payment||Check Signed By*||Supporting Documentation|
|213||09/21/96||JABBO Kenner||$200.00||Football league||Chairman & Treasurer||Approved minutes and cancelled check|
|214||10/14/96||Bell Atlantic||66.27||Telephone Service||Chairman & Treasurer||Cancelled check only|
|215||10/14/96||AT & T||1.11||Long Distance Service||Chairman & Treasurer||Vendor invoice and canceled check|
|216||12/16/96||7th District Police||300.00||Grant -- Toys for Tots||Chairman & Treasurer||Approved minutes and canceled check|
|217||01/10/97||Bell Atlantic||127.20||Telephone Service||Chairman & Treasurer||Canceled check only|
|218||01/10/97||Pitney Bowes||126.00||Postage-by-phone||Chairman & Treasurer||Canceled check only|
|219||02/14/97||Alfonso Williams||100.00||Reimbursement supplies||Chairman & Treasurer||Safeway statement and canceled check|
|220||03/10/97||Bell Atlantic||189.41||Telephone Service||Chairman & Treasurer||Vendor invoice and canceled check|
|221||03/10/97||ANC Security Fund||30.00||Bonding Treasurer||Chairman & Treasurer||Canceled check and Auditors receipt|
|223||05/11/97||Bell Atlantic||113.04||Telephone Service||Chairman & Treasurer||Canceled check only|
|224||05/19/97||Cash||75.00||Reimbursement supplies||Chairman & Treasurer||Canceled check only|
|225||06/06/97||Canon Office Supplies||1,032.00||Toner Cartridges||Chairman only||Vendor invoice and canceled check|
|226||06/24/97||Bell Atlantic||69.37||Telephone Service||Chairman & Treasurer||Canceled check only|
|227||06/24/97||Canon||15.50||Supplies||Chairman & Treasurer||Canceled check only|
|228||08/20/97||Bell Atlantic||121.81||Telephone Service||Chairman & Treasurer||Canceled check only|
|232||10/20/97||Bell Atlantic||114.82||Telephone Service||Chairman & Treasurer||Canceled check only|
|233||10/20/97||Pitney Bowes||133.95||Postage-by-phone||Chairman only||Canceled check only|
|234||11/10/97||Norths Office Machines||173.25||Office Supplies||Chairman & Treasurer||Canceled check only|
|235||12/13/97||Bell Atlantic||118.01||Telephone Service||Chairman & Treasurer||Canceled check only|
|236||03/01/98||ANC Security Fund||30.00||Bonding Treasurer||Chairman & Treasurer||Canceled check and Auditors receipt|
|237||03/01/98||Bell Atlantic||60.00||Telephone Service||Chairman & Treasurer||Canceled check only|
|238||03/03/98||Camp Dynamite||VOIDED||Grant Scholarship||Voided check|
|240||03/18/98||VOIDED||See Checkbook||Voided check|
|242||04/29/98||Bell Atlantic||126.01||Telephone Service||Chairman & Treasurer||Canceled check only|
|243||05/20/98||ACC/Phil Pannell||50.00||Membership Fee anti-drug Campaign||Chairman & Treasurer||Canceled check only|
|245||05/25/98||Bell Atlantic||59.05||Telephone Service||Chairman & Treasurer||Canceled check only|
|246||05/29/98||Pitney Bowes||100.00||Postage-by-phone||Chairman & Treasurer||Canceled check only|
|247||06/26/98||Bell Atlantic||55.63||Telephone Service||Chairman & Treasurer||Canceled check only|
|248||06/26/98||Pitney Bowes||33.95||Office Equipment||Chairman & Treasurer||Canceled check only|
|249||07/27/98||Bell Atlantic||72.22||Telephone Service||Chairman & Treasurer||Canceled check only|
Source: ANC 8E files and checkbook register, and Riggs Bank records
*Note: Chairman Robert Yeldell; Treasurer Alfonso Williams
District of Columbia Code, Section 1-264(m), in relevant part, states:
". . . A grant may not be awarded unless the grant is awarded pursuant to a vote of the Commission at a public meeting. . ."
Further, District of Columbia Code, Section 1-264(f), in relevant part, states:
"No expenditure of any amount shall be made without the specific authorization of the Commission. . ."
During the period covered by this audit, ANC 8E awarded nine (9) grants totaling $2,840. Only two grants, totaling $500 (JABBO Kenner $200 and 7th District Police $300), were: (i) supported by a grant request letter; and (ii) approved by a majority of commissioners in a publicly held meeting of the ANC and reflected in the minutes of the ANC's meeting.
ANC 8E's chairman and treasurer were unable to provide the Auditor with approved minutes reflecting the ANC's approval of the other seven (7) grants totaling $2,340. As a result of this deficiency, ANC 8E's chairman and treasurer failed to adhere to D.C. Code, Section 1-264(f) by disbursing ANC funds without obtaining the approval of a majority of ANC 8E commissioners during public meetings at which a quorum was present.
By letter dated May 2, 1994, the Auditor informed all ANC's that:
"ANC's will be required to attach a copy of the grant request letter or proposal to support all grant expenditures which have been voted on by the Commission at a public meeting. The ANC also must submit copies of the minutes to substantiate that the grant in question was voted on and approved by the full Commission. Failure to comply with the revised procedures will result in this office recommending disallowance of grant expenditures not supported by the appropriate documentation." (Auditor's Emphasis)
In the absence of ANC 8E minutes to support the commissioners' approval of the seven grants, the $2,340 in disbursements will be disallowed from ANC 8E's next quarterly allotment.
Table II presents a list of the seven questionable disbursements made by ANC 8E's chairman and treasurer between March 1997 and May 1998. Table II includes the stated purpose for each disbursement, the date each check was written, each check number, and the amount of each disbursement.
|Organization Receiving Grant and Purpose of Grant||Date Check Written||Check Number||Amount of Grant Award|
|UTRECHT School Wall Mural||03/18/97||222||$300|
|Assumption Booster Club Football League Uniforms||08/25/97||229||500|
|Valley Green Reunion Committee Family Reunion||08/25/97||230||500|
|Funds of the Communitys Future McGogney School Wall Mural||09/11/97||231||200|
|Camp Dynamite Scholarships||03/10/98||239||300|
|YMCA Summer Camp||03/18/98||241||300|
|7th District Station Fund Community Service awards to Police Officers||05/20/98||224||240|
Source: ANC SE files
Advisory Neighborhood Commission 8E violated D.C. Code, Section 1-264(m), which states, in relevant part, that:
". . . A Commission shall adopt guidelines for the consideration and award of grants that shall include a provision that requires the proposed grantee to present the request for a grant at a public meeting of the Commission. . ."
ANC 8E's chairman and treasurer could not provide grant award guidelines which were used by the ANC to consider and award grants. As a result, the Auditor could not discern how grantees were selected, how grant amounts were determined, or the specific public purposes for which grants were awarded.
According to the Valley Green Reunion Committee's "request for funding," the $500 disbursement to this group was used, in part, to cover the cost of food and entertainment. The disbursement violated D.C. Code, Section 1-264(1), which states, in relevant part, that:
"A Commission shall expend funds received through the annual allocation. . . or other donated funds for public purposes within the Commission area or for the functioning of the Commission office, including staff salaries and nominal refreshments at Commission meetings. . . funds allocated to the Commission may not be used for ...meals..." (auditor's emphasis)
Further, a legal opinion issued by the Office of the Corporation Counsel, dated May 26, 1994, in relevant part, states:
". . . Just as the entertainment of government personnel is generally unauthorized, the entertainment of non-government personnel is equally impermissible. The basic rule is the same regardless of who is being fed or entertained: Appropriated funds are not available for entertainment, including free food, except under specific statutory authority....In sum, food and entertainment are not permissible purposes for which an ANC may make a grant. . . "
The $500 disbursement to the Valley Green Reunion Committee also violated the ANC law by: (a) not qualifying as a grant for a public purpose, and (b) not being approved by a majority of commissioners in a public meeting.
District of Columbia Code, Section 1-264(e) states, in relevant part, that:
"Each Commission shall, by resolution, designate the location at which the Commission's books and records shall be maintained which shall, if the Commission has a regular office, be the Commission office. . . "
ANC 8E's officers failed to maintain the ANC's books and records in a single location designated by a majority of commissioners in a public meeting. As a consequence, the Auditor was unable to locate minutes of ANC 8E meetings held between September 1996 and November 1998, except for two sets of minutes for meetings held in October and November 1996. The Auditor was also unable to locate a significant number of ANC 8E's canceled checks, bank statements, vendor invoices, and receipts in support of the ANC's expenditures. The Auditor obtained copies of canceled checks and bank statements from Riggs Bank.
ANC 8E officers maintain the ANC's books and records at a location designated by a majority of ANC 8E commissioners in accordance with D.C. Code, Section 1264(e).
Safeway Stores erroneously wrote a $100 check, on February 4, 1997, to ANC 8E for advertising in the Ward 8 Business Directory. The ANC's treasurer deposited this check into ANC 8E's checking account. ANC 8E's treasurer, who was a member of the Ward 8 Business Council, solicited the $100 payment from Safeway Stores for an advertisement in the Ward 8 Business Directory. To correct this mistake, ANC 8E's chairman and treasurer issued an ANC 8E check numbered 219, dated February 14, 1997, to ANC 8E's treasurer, Alfonso Williams. Mr. Williams was to pay the proceeds from this check to the Ward 8 Business Council on behalf of Safeway Stores. The treasurer should have returned the check to Safeway Stores and requested Safeway to write a new check made payable to the Ward 8 Business Council.
Advisory Neighborhood Commission 8E's chairman and treasurer improperly signed check number 224, dated May 19, 1997, made payable to "Cash" in the amount of $75. This transaction violated D.C. Code, Section 1-264(f) which states, in relevant part, that:
". . . No check may be made payable to cash. . ."
The transaction also violated ANC Financial Guidelines and Procedures issued by the Office of the Auditor, which prohibits writing checks to "cash" or "bearer". The check, which was endorsed by ANC 8E's treasurer, was stated to be a reimbursement for the treasurer's purchase of ANC office supplies. However, there were no receipts, vendor invoices, or approved minutes in the files of ANC 8E to support the treasurer's purchase of office supplies with his personal funds or to substantiate the ANC's approval of this disbursement. ANC 8E should have established a petty cash fund to purchase office supplies valued at $50 or less or should have written an ANC 8E check directly to the vendor.
Table III presents three (3) ANC 8E checks improperly issued with only the signature of ANC 8E's chairman, Robert Yeldell, in violation of D.C. Code, Section 1-264(f) which states, in relevant part, that:
". . . Any expenditure made by check shall be signed by at least two officers of the Commission, one of whom shall be the treasurer or chairman. . . "
Also, Article IV E (l) of ANC 8E's Bylaws state:
"The signature of the Treasurer and the Chairman or Vice-chairperson shall be required on all drafts and checks."
ANC 8E's treasurer produced only one invoice, from Canon Office Supplies, in support of the disbursements listed in Table III. There were no other vendor receipts or invoices. Further, the disbursements, totaling $1,280.77, were not approved by a majority of ANC 8E commissioners. Unless ratified by a majority of ANC 8E commissioners, the disbursements listed in Table III will be deducted from ANC 8E's next quarterly allotment.
Advisory Neighborhood Commission 8E Checks Signed by Only One Commissioner For the Period June 1997 Through October 1997
|Check Number||Date on Check||Check Made Payable To||Amount of Check||Purpose of the Payment|
|225||06/06/97||Canon Office Supplies||$1,032.00||Toner Cartridges|
|232||10/20/97||Bell Atlantic||114.82||Telephone Service|
Source: ANC 8E checkbook register and Riggs Bank records
ANC 8E refrain from writing checks made payable to ANC commissioners, except for reimbursements that are supported by receipts or other appropriate documentation and approved by a majority of commissioners in a public meeting of the ANC.
The Office of the Inspector General investigate expenditures made by ANC 8E's chairman and treasurer without the ANC's approval, in addition to the disbursements that could not be supported by appropriate documentation.
Advisory Neighborhood Commission 8E violated D.C. Code, Section 1-264(j) by failing to file quarterly reports of financial activity with the Office of the District of Columbia Auditor from January 1, 1997 through November 30, 1998. D.C. Code, Section 1-264(j) states that:
"The treasurer of a Commission shall prepare a quarterly financial report on a form provided by the Auditor. The financial report shall be presented to the Commission for its consideration at a public meeting of the Commission within 30 days of the end of the quarter. A copy of the approved financial report, signed by the Chairman, the Secretary and the treasurer, shall be filed, along with a record of the vote adopting the report with the District of Columbia Auditor within 7 days of approval. No quarterly allotment shall be forwarded to a Commission until the report of financial activity for the quarter preceding the immediate previous quarter is submitted to and reviewed by the Auditor."
The last quarterly financial report filed by ANC 8E covered the period October 1, 1996 through December 31, 1996. As a result of ANC 8E's failure to file timely quarterly financial reports for the period January 1, 1997 through November 30, 1998, the District government is withholding approximately $17,388.32 of ANC 8E's allotments. The Auditor is particularly concerned by the fact that ANC 8E has cash on hand of approximately $11,416 in its bank account during a period of delinquency in filing quarterly financial reports. For this reason, ANC 8E should not be allowed to retain custody of its checkbook or conduct any financial activity until outstanding quarterly reports are filed with the Office of the Auditor.
ANC 8E promptly file all outstanding quarterly financial reports with the Office of the District of Columbia Auditor. These late reports must be approved by a majority of ANC 8E commissioners and must be supported by appropriate documentation.
Advisory Neighborhood Commission 8E's chairman has failed to fully reimburse ANC 8E a total of $9,529.77 pursuant to an Order issued by the Superior Court of the District of Columbia. On January 3, 1991, Superior Court Associate Judge Frederick D. Dorsey placed ANC 8E's chairman on probation and ordered (Case Number F-9574-90) the chairman to make restitution to ANC 8E in the amount of $9,529.77 for misappropriation of ANC 8E funds.
The chairmen paid a total of $3,601.57 through January 4,1994. As monthly payments were received, each payment was posted to ANC 8E's account. As of November 30, 1998, records in the Office of the District of Columbia Auditor indicated that ANC 8E's chairman had not made any further restitution payments since January 1994 while $5,928.20 remained due and payable to ANC 8E. As a result of this lapse, ANC 8E's chairman is still indebted to the ANC in the amount of $5,928.20.
If restitution payments are not promptly resumed, the Office of the Corporation Counsel should initiate the appropriate actions necessary to recover the $5,928.20 in restitution due to ANC 8E from its chairman or refer the matter to the United States Attorney for the District of Columbia for appropriate action.
Based on the review of Advisory Neighborhood Commission 8E's financial accounts and activities, the Auditor found a pattern of ANC 8E's chairman and treasurer disbursing funds without the approval of a majority of ANC 8Ecommissioners The Auditor found that ANC 8E's officers failed to maintain basic documentation to justify and support the disbursement of ANC funds. The Auditor further found a complete breakdown in ANC 8E's ability to prepare minutes of its public meetings and maintain those minutes in the files at the ANC's office. Also, ANC 8E's chairman and treasurer disbursed ANC 8E funds without adhering to relevant requirements of the Advisory Neighborhood Commission Act of 1975, as amended, legal opinions issued by the Office of the Corporation Counsel, ANC 8E bylaws, and Financial Guidelines and Procedures issued by the Office of the D. C. Auditor.
The audit revealed that ANC 8E officials disbursed funds in a manner that circumvented basic internal controls. Further, record retention was inadequate and involved missing canceled checks, bank statements, vendor invoices, receiving reports, and minutes of ANC 8E's public meetings. Violations of the ANC law included the chairman and treasurer signing ANC 8E checks for improper or unapproved expenditures, and the ANC's failure to file approved quarterly financial reports over an approximate two- year period with the Office of the District of Columbia Auditor.
The Auditor also found that ANC 8E's chairman had not made full restitution to ANC 8E as required by the Superior Court of the District of Columbia. Outstanding restitution payments totaled $5,928.20 as of November 30, 1998. The Auditor has recommended that the chairman promptly resume restitution payments or that the Office of the Corporation Counsel initiate the appropriate action to promptly recover these funds.
Deborah K. Nichols
Interim District of Columbia Auditor
l. The $2,840 includes the seven grants presented in Table II and two grants (JABBO Kenner, $200 and 7th District Police, $300) listed in Table I.
2. The $3,193.60 does not include the following two grants, listed in Table I: JABBO Kenner, $200 and 7th District Police, $300.
3. The $3,693.60 represents all expenditures of ANC 8E during the 22 month period, except the seven unapproved grant disbursements ($2,340) listed in Table II.
4. The $2,340 included only the seven grants listed in Table II that were not approved by a majority of ANC 8E commissioners, but does not include two grants totaling $500 made to JABBO Kenner for $200 and the 7th District Police for $300.
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