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(A) (1) IC 5-11-1-27(j) establishes that all erroneous or irregular material variances, losses, shortages, or thefts of political subdivision funds or property not related to a clerical error that can be remedied at no loss to a political subdivision of the State of Indiana shall be reported immediately to the Indiana State Board of Accounts. For all material variances, losses, shortages, or thefts, the State Board of Accounts shall:
(a) Determine the amount of funds involved and report the amount to the appropriate government and law enforcement officials;
(b) Determine the internal control weakness that contributed to or caused the condition; and
(c) Make written recommendations to the appropriate legislative body or appropriate official overseeing the internal control system addressing:
1. The method of correcting the condition; and
2. The necessary internal control policies and internal control procedures that must be modified to prevent a recurrence of the condition.
(2) The Indiana State Board of Accounts has ruled that in general, each political subdivision must develop its own policy on materiality because the causes of such irregular variances, losses, shortages, and thefts are as broad and varied as the political subdivisions in which the incidents might and could occur.
(B) It is hereby established by the Town Council that the threshold at which point the material variance, loss, shortage, or theft shall be reported to the Indiana State Board of Accounts as set out in IC 5-11-1-27(l) which requires public officials who have actual knowledge or reasonable cause to believe that there has been misappropriation to report it immediately to the Indiana State Board of Accounts and to the Huntington County Prosecuting Attorney be set as follows:
(1) A one-time loss of at least $5,000;
(2) A recurring cash loss of at least $2,000 average per month;
(3) A value of $5,000 for a one-time loss of assets; or
(4) A creation of additional liabilities of at least $2,000 per month.
(C) The Town of Warren Council does recognize that variances, losses, shortages, and thefts may occur, and if such an incident occurs, it is the Council’s position that the Clerk-Treasurer or such other employee as becomes aware of the variance, loss, shortage or theft does report the same to the President of the Town Council and to the Clerk-Treasurer to be placed on the agenda for resolution at a called meeting of Town Council.
(D) All items not meeting established criteria for reporting to the Indiana State Board of Accounts shall be resolved at the Town Council level with appropriate documentation retained in the office of the Clerk-Treasurer by:
(1) Implementation of procedures designed to prevent the recurrence of such incidents: and
(2) Institution of appropriate disciplinary action against the employee(s) responsible.
(Ord. 2016-1, passed 3-14-16)