Summary

This audit focused primarily on expenditures and related activities for the period October 1, 1995, through September 30, 1996. We conducted our audit in accordance with generally accepted auditing standards, and Government Auditing Standards issued by the Comptroller General of the United States.

Matters coming to our attention relating to noncompliance with various guidelines and those relating to significant deficiencies in the design or operation of the system of internal control for those operations audited are as follows:

Land Acquisitions

For one of the District's land acquisitions (Atsena Otie Key), the District negotiated the purchase price and entered into a purchase option agreement for $3,100,000 prior to receiving the related appraisal reports. District records did not document the basis utilized by the District to establish the option purchase price. (See paragraphs 36 through 40.)

For the same land acquisition, there was no documented review of the independent appraisals received or documented consideration and explanation of the significant divergence between the appraisals. As a result, the purchase price paid by the District may have exceeded the property's fair market value. (See paragraphs 41 through 46.)

Budgetary Controls

Our comparison of the District's expenditures with approved budgetary authority disclosed that, for the fiscal year ended September 30, 1996, although total expenditures for each of the District's funds did not exceed approved budgetary authority, reported expenditures exceeded approved budgetary authority in certain categories within the General and Special Revenue Funds. (See paragraphs 47 through 50.)

Travel-Related Expenditures

In several instances, the District provided meals and refreshments to individuals without statutory authority to expend funds in such a manner. Also, in some instances, the District provided meals to travelers which costs exceeded the limits set forth in Section 112.061(6)(b), Florida Statutes. (See paragraphs 53 through 55.)

It was not apparent from the records of the District what necessary public purpose was served by holding Governing Board retreats at a location other than the District headquarters and, consequently, incurring significant travel expenses. (See paragraphs 56 through 59.)

The District made payments totaling $2,768.56 directly to vendors for lodging, contrary to Section 112.061(13), Florida Statutes. Direct payments for lodging are permitted only when the employee is required to travel on emergency notice. (See paragraphs 60 and 61.)

In some instances, the District made direct payments to vendors for lodging of District employees and authorized travelers which were not substantiated by paid invoices or other documentation. (See paragraphs 62 and 63.)

Communication Expenditures

The District did not maintain telephone logs or other records to document the authorized public purpose of long-distance or cellular telephone calls billed to the District during the fiscal year ended September 30, 1996. (See paragraphs 64 through 67.)

Contractual Services

The District entered into a ten-year Forestry Management Agreement costing approximately $382,000 per year without benefit of a competitive bid or competitive selection process. In the absence of a competitive selection process, District records do not evidence that these services were obtained at the lowest available cost consistent with acceptable quality and performance. (See paragraphs 69 through 73.)

Documentation supporting payments to independent contractors did not, in some instances, contain any breakdown of charges for hours worked and did not itemize or document out-of-pocket costs. Accordingly, neither District personnel nor we on postaudit could determine that the amounts billed were the amounts actually owed in accordance with the contracts. (See paragraphs 74 through 78.)

Utilization of Resources

Vehicle usage logs maintained by the District did not contain adequate information to evidence the public purpose served by the use of the District's vehicles. (See paragraphs 79 through 82.)

Inspector General

The District employee serving as the inspector general for the District reports directly to the Executive Director rather than the Governing Board, contrary to Section 373.079(4)(b)1, Florida Statutes. (See paragraphs 83 through 86.)

Notice of Meetings

Contrary to the requirements of Section 189.417(1), Florida Statutes, the District did not file an annual schedule of its regular meetings with each of the local governing authorities within the District boundaries for the 1995-96 fiscal year. (See paragraphs 87 through 89.)

Cash and Investments

Deficiencies in the District's internal controls over bank account transactions limited management's assurances that only authorized transfers of District moneys were made. (See paragraphs 92 through 94.)

Funds invested in overnight repurchase agreements were not adequately safeguarded, resulting in an increased risk of loss to the District. (See paragraphs 95 through 97.)

The District's Land Acquisition Revenue Refunding Bonds, Series 1992, Debt Service Reserve Fund is invested in a manner contrary to the provisions of the governing bond resolution. (See paragraphs 98 through 100.)

The Suwannee River Water Management District Chairman's written response to the audit findings and recommendations included in audit report No. 13048 is presented as Exhibit E.