PHOENIXVILLE - A financial audit for 2003, as performed by Maulo & Company, showed that borough finances are "much improved and stable."
President Lawrence P. Maulo, Jr. , CPA presented the report to Borough Council at Monday's meeting. "This year the borough is following a plan with a slight surplus," said Maulo.
The audit shows that the borough's general fund balance at Dec. 31, 2003 was $835,825, which is a $190,005 increase from the prior year.
Maulo said that capital reserves for Phoenixville's yearly budget were adequate to finance the borough for a two-month time period if needed.
"The water and sewer funds support themselves and don't go against the tax base," said Maulo.
Maulo noted that 65 percent of borough revenues are generated by local taxes, which is normal for most municipalities. He said that the borough is finding new federal grant sources.
"Revenues ended the year on target, thanks to increases in permit fees and intergovernmental grants and other revenues," reads the audit report.
Borough practices received a clean bill of health.
"The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards," reads the audit.
The report addressed several matters for the borough to consider "that are opportunities for strengthening internal controls and operating efficiency."
Many of the cited matters were already discussed with borough representatives and have been implemented.
"We have been complying with the law all along and tightened things up," said Borough Manager Don Edwards. "We are doing the right thing."
The audit noted that several large cash purchases of more than $1,000 were made without a completed purchase order.
"On the other hand, we noted that small purchases under $100 were being made with the use of purchase orders," reads the audit.
Previously Maulo had suggested that the borough establish a written purchase policy and a borough policy has been established.
The audit read that accounts receivable were not "aggressively collected."
Maulo said with $273,537 in collectibles that were at least 90 days late that the borough might have "a cash flow problem in the near future."
"We recommended that you either place a lien on all billings over 90 days or you hire a collection agency to actively pursue the collections of these receivables," reads the report. "We felt that with an active collection effort on your part you could avoid any possible future cash flow problems, which appeared imminent, particularly with the Water Fund."
The audit also addressed real estate tax collections.
The report cited a real estate tax collection rate of 94 percent of the amount levied which according to Maulo should be approximately 98 percent.
The report agreed with the new borough purchase of accounting software that "will save you employee time and costs, and will insure grant compliance."