HomeMy WebLinkAboutTourism Funds Memorandum w response A
CHIEF FINANCIAL OFFICER
Teresa Beckner, CPA, CGMA
FRANKLIN COUNTY
FISCAL DIRECTOR
Fiscal Department
Janelle Friese, CGFM
COMMISSIONERS
Dean A. Horst, Chairman
ASSISTANT FISCAL
272 N. 2nd Street Chambersburg, PA 17201
DIRECTOR
John T. Flannery
Erin Witmer, CPA, CGMA
Fiscal@franklincountypa.gov
Robert G. Ziobrowski
717.261.3101
June 18, 2024
Franklin County ControllerÓs Office
272 N. Second Street
Chambersburg, PA 17201
Audit Response
Please find below a response to the Memorandum on Tourism Funds dated May 2, 2024.
Background
The county collects a 5% hotel occupancy tax under a Tourist Promotion Assessment Ordinance. The
collections are disbursed to the Franklin County VisitorÓs Bureau after the county deducts a 4%
administrative fee. The VisitorÓs Bureau, in turn, returns 20% to the county. These funds had been
classified as restricted in fund 88 for the past ten years. Grants were issued through the Planning
Department to non-profits organizations and municipalities for projects promoting tourism.
As part of the TreasurerÓs Office audit, we reviewed hotel tax revenue from January 1, 2023 through
December 31, 2023. We verified and recalculated the distributions to the VisitorÓs Bureau and the
resulting contributions from the VisitorÓs Bureau to the County. We verified proper recording of the funds
in the general ledger. Fiscal receives the check from the VisitorÓs Bureau and records in the appropriate
account.
Finding
Restricted funds in fund 88 were reclassified to assigned fund balance - fund 80 without formal approval
of the Board of Commissioners. No documentation was available to support authorization of the transfer
until audit requested it. During the audit, the county solicitor confirmed through a brief email that it was
his opinion that the funds had no legal restrictions. The total amount transferred from restricted to
assigned was over $800,000. Material changes to the financial records classified as restricted or
committed should be approved by the Board of Commissioners.
Recommendation
Board of Commissioners approval should be obtained for the removal of the funds from restriction. If the
funds were restricted in error for 10 years, then the transfer would be the correction of an accounting
error and should be disclosed in the financial statements in accordance with accounting standards.
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