(A) Purpose and materiality threshold. The purpose of this policy is to communicate the Town Council's internal control objectives to all employees and elected officials of the town and to firmly commit the town to the principles of internal controls as established by the Indiana State Board of Accounts.
(B) The town has a responsibility to establish and maintain an adequate system of internal controls and to furnish to the Ellettsville Town Council, governmental agencies, creditors and others reliable financial information on a timely basis. As the fiscal body, the Ellettsville Town Council expects the town administration and the town's employees to effect an internal control environment with policies and procedures necessary to provide reasonably assurance that practices cause effective and efficient operations, reliable financial reporting, and compliance with applicable laws and regulations and to minimize the risk of loss.
(C) As the town's chief financial officer, the Town Clerk-Treasurer will be the town's chief agent in implementing and managing the internal control policies and procedures. As the individual with delegated approval authority, the Town Manager shall be responsible for maintaining and supporting the system of internal controls. The Town Council directs the Clerk Treasurer and the Town Manager to monitor the necessary compliance with the policy on materiality and process for reporting material items and report noteworthy items to the Town Council.
(D) The materiality threshold for the town shall be $100. If the erroneous or irregular variance, loss, shortage or theft is not cash or a cash-equivalent, the value of the item at the time of the variance, loss, shortage or theft shall be used to determine whether the materiality threshold has been met.
(E) Knowledge of misappropriation and maintenance of documentation.
(1) All erroneous or irregular variances, losses, shortages or thefts of $100 or more shall be reported immediately to the State Board of Accounts.
(2) In addition, all erroneous or irregular variances, losses, shortages or thefts which occur more than three times in a month and which in the aggregate total $300 or more shall be reported immediately to the State Board of Accounts.
(F) A town employee or public officer who has knowledge of or reasonable cause to believe that there has been a misappropriation of public funds or assets of the public office shall immediately send written notice of the misappropriation to the Indiana State Board of Accounts and the Monroe County Prosecuting Attorney.
(G) The town shall maintain records and documents concerning erroneous or irregular variances, losses, shortages or thefts in accordance with generally-accepted accounting principles and the internal control standards provided by the Indiana State Board of Accounts.
(H) The Town Council calls upon the Clerk Treasurer and all town officials, employees and agents to enforce and comply with the policy on materiality and process for reporting material items and to report noteworthy items to Town Council.
(I) The town hereby adopts the internal control standards developed by the State Board of Accounts as published in the Uniform Internal Control Standards for Indiana Political Subdivisions and as may be amended from time to time. Whenever the State Board of Accounts Uniform Internal Control Standards imposes a greater restriction or higher standard than is required by a provision of this code, the more restrictive provisions apply.
(J) Any provision contained herein which is found by a court of competent jurisdiction to be unlawful or which by operation shall be inapplicable, shall be deemed omitted but the rest and remainder of this section, to the extent feasible, shall remain in full force and effect.
(Ord. 2016-05, passed 5-23-2016)