A state audit found widespread financial recordkeeping failures in the Town of Cato, raising concerns about oversight, transparency, and the potential for misuse of public funds.
The report from the New York State Comptroller’s Office concluded that the town supervisor did not maintain complete, accurate, or up-to-date financial records, leaving the town board without reliable information to manage operations or monitor spending.
Auditors identified significant discrepancies, including $348,817 in unrecorded receipts and $744,572 in unrecorded disbursements over a multi-year period. These gaps were attributed in part to the supervisor delegating financial responsibilities to a bookkeeper without adequate oversight, allowing errors to go undetected.
The audit also found weak internal controls around spending. Of 330 disbursements reviewed totaling about $1 million, hundreds lacked proper board approval or supporting documentation. In some cases, auditors could not determine whether certain payments were for legitimate town purposes.
Payroll oversight was also lacking. One employee was overpaid by $2,600 due to errors in the payroll system, which were not caught because supporting documentation was not adequately reviewed.
Compounding the issues, the town failed to file required Annual Financial Reports for years. Auditors found filings were delinquent dating back to 2017, with reports from 2018 through 2024 still unfiled as of late 2025, limiting transparency for residents and state officials.
The comptroller’s office issued 10 recommendations aimed at improving oversight, ensuring accurate recordkeeping, and restoring compliance with state financial reporting requirements. Town officials said they did not dispute the findings and have begun taking corrective action.
The town board is now required to submit a corrective action plan within 90 days outlining how it will address the deficiencies identified in the audit.
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