AP audit uncovers embezzlement in Iowa city

A recent accounts payable audit found that the former clerk of Stockton, Iowa, misappropriated more than $65,000 of city funds.

Larry McCoy used the city's credit card for nearly $25,000 of personal expenses, including his satellite and cable TV bills, charges from an eye surgeon, groceries, and an alcohol purchase. He made an additional $4,300 of improper payroll payments to himself and disbursed more than $7,500 to two former mayors. McCoy also failed to deposit $15,450 in city utility collections.

Iowa State Auditor David Vaudt devised several audit solutions in his report, including a recommendation that the city strengthen its internal controls by segregating duties and requiring the city clerk to prepare financial reports on a monthly basis, according to the Quad-City Times. Vaudt also recommended that the city adopt a credit card policy, reconcile utility billings and collections, maintain supporting documentations for all disbursements, and tighten its efforts to ensure time sheets are completed in accordance with policy.

The investigation covered a six-year period from mid-2004 to October of last year. Conducting regular accounts payable audits can help organizations identify unsupported expenditures quicker.

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