Bay St. Louis council calls for federal probe into $186,000 in police-forfeiture money ~ Wes Muller
Playing games with pooled bank accounts is nothing new or particularily innovative on the book cooking front. What gets me is the fact that the same pot of money is apparently spent over and over and over again. I’ll term it Hocus Pocus accounting and it is fairly easy to see through.
Speaking of Hocus Pocus accounting in the Bay we have a Hocus Pocus budgeting as well as. You see folks in Mississippi by law Municipalities must prepare their budget on the cash basis with one exception. What this means is revenue per the budget is recognized when actually received rather than when earned. This means with the exception of previous fiscal year claims paid within 30 days after September 30 that expenses are recognized when paid rather than when incurred. Since we’re talking governmental accounting this also means that capital expenses are shown as an expense when paid and both loan principal and interest are expensed when paid. Adjusting for claims paid 30 days after year end this also means the following equation is true. [Section 21-35-23, Miss. Code Ann. (1972)]
Beginning Cash in fund + budgeted revenues – budgeted expenses = Ending Cash in fund
Now I would encourage everyone to visit the City’s website and download the original and amended budgets for 2014-2015. Look hard for the equation I highlighted above but you can also take it from me that you won’t find it because the City did not use the correct format for its budget. Correct format??? What the heck is Handshoe talking about? I’m talking about the Mississippi Audit and Accounting Guide for Municipalities promulgated by the Mississippi State Auditor’s office, which by law has the authority to dictate the form of the budget. [Sections 21-35-7 and 21-35-29, Miss. Code Ann. (1972)] The following is what I am talking about being missing from the Bay Budget: Continue reading “Trolley lolley lolley, fa la la la……”