In a conference call held during the Newcastle Board of Selectmen meeting Jan. 26, Ron Smith, of RHR Smith and Company, reported finding $147,000 double counted as revenue during part of the 2008 audit.
Double-entering the revenue means Newcastle failed to collect $147,000. The selectmen and Town Administrator Ron Grenier decided to absorb the loss of income within their 2008 operating budget, according to Grenier.
At some point in 2009 the town believes it will need to borrow a Tax Anticipation Note (TAN) to cover those funds, Grenier said.
Originally, Smith presented to the board three options: send out supplemental bills to residents; use the fund balance in the overlay; or, use the $198,000 the town raised to renovate the Taniscot building to cover the $147,000 shortfall.
There still remains the question of how a double-entry was possible; essentially 4.3 percent of the existing budget.
Grenier said the budget was set and approved before he was hired and further, he said the budget was set and approved at the 2008 annual town meeting. He said it had not been possible for the double-entry to show up until an official audit was performed.
“It is not the kind of thing you catch until you do a final audit,” he said.
Currently, Grenier gives quarterly reports to the selectmen, which have shown where the previous administration did not budget, “for computer software licenses, and didn’t budget [the] various accounts properly.”
Grenier attributed the error to a mistake on an Excel spreadsheet used by the previous administrator, Sandra Blake, to compute the budget. He was quick to point out that he used the TRIO program to prepare the budget this year, and will continue to use that program going forward.
Blake, Newcastle first town administrator announced her resignation in Jan. 2008 and stepped down April 1.
Overall, according to the audit, the town’s finances are quite healthy. Smith said he expects Newcastle to have nearly $490,000 in the fund balance by the end of the fiscal year. That is 30 days of operating surplus.
