Oversight: Audit shows need for keeping an eye on funds

It is not enough to have someone minding the store, as a new report from Ohio Auditor Dave Yost makes clear. When the public’s money is involved, there needs to be plenty of oversight.

Yost’s report, “Pocketed Payments: Preventing the Theft of Incoming Funds,” targets local governments, including school districts. It includes details on 77 cases in which public money was stolen by those who were supposed to be in charge of it. A total of $3.4 million was involved during a 10-year period.

Ten of the 77 cases originated in East Ohio. Municipal, school, park and court funds were taken.

Not infrequently, the perpetrators get away with diverting public money into their own pockets for years, until an auditor from Yost’s office looks at the books. These state audits clearly are important safeguards.

Most cases of theft from public entities occur when an individual has control over collecting money and handling the bookkeeping for it. Often, such thieves have big advantages:

First, of course, it is not difficult to take cash, pocket it, then cover one’s tracks in accounting for funds.

Second, the thieves sometimes are the only people involved with professional education in accounting. To the untrained eye, financial records can be virtually indecipherable.

Third, many small towns and school districts are governed by councils and boards made up of volunteers who often lack the time to monitor finances.

Yost’s report is a reminder not just of the frequency of public funds thefts, but also of the relative ease with which that can be done.

It also should serve as an alarm for local government and school officials who entrust fiscal affairs to one, or even two people: The more eyes there are on financial records, the better.