Money missing in Sentinel Gap Water records

SCHAWANA - An independent audit of the Sentinel Gap Water Association (SGWA) financial accounting records shows "missing money," according to the firm that did the audit.

The amount discovered is around $2,000. But Association President Alfredo Gutierrez believes it could be more, perhaps as much as $10,000.

The SGWA provides potable water for about 56 accounts (lots) in Schawana. There are about 100 more lots that are not being served because of the limitations of the association's permit and capacity of the system.

Gutierrez, who took leadership of the Association in October of 2011, started looking into the association's financial records immediately. He wanted to make sure all was in order so that the association could apply for a new permit and loans to expand and be able to serve more of the lots in the community.

While doing his own investigation, Gutierrez discovered many lot owners with excessive outstanding water bills, some in the thousands of dollars. While inquiring with the same people as to why, some claimed they had paid the bills and even had receipts to prove it.

And some had not paid, Gutierrez found. So he decided to look into the matter further and did so with a Grant County sheriff's deputy present at a public meeting. He asked for a deputy in case it was discovered there had been some criminal activity involved.

After that meeting, Gutierrez said, the sheriff's department advised him to do an audit of the financial system and forward it to the sheriff. That's when he hired Samuel Barnes and Associates of Ephrata.

CPA Samuel A. Barnes turned the audit report over to Gutierrez late last year. Gutierrez forwarded it to the Grant County Sheriff's office in January.

"I don't know what they're going to do with it, if anything," Gutierrez said. "I've done my part. Maybe there was criminal activity, maybe not."

Barnes reported that there were many instances of missing incoming cash payments found in the accounting system for calendar years 2010 and 2011.

To the audit report he attached spreadsheets which list each cash payment in the receipts book.

"After tracing these receipts to the bank statements, I found missing cash," Barnes said.

Under an audit report column labeled "missing money," Barnes listed $1,861.92 missing in 2010 and $415.86 missing in 2011.

Barnes also found "database correction" and "adjustment" entries on multiple customer accounts "to artificially reduce their balances to cover up the fact that the incoming payments were received but not deposited."

Barnes reported that there were no irregularities found in the outgoing money that was spent via checks written.

This March, Gutierrez said he had welcomed the audit so the finger could not be pointed at him for any shortages. He also wanted to make sure his wife Tina, the association secretary, was clear of blame.

"We have been paying the association bills since we took over," Alfredo Gutierrez said, "And we have not spent money on anything new. People are current on their bills. The association's bank account has grown since we took over."

According to Tina Gutierrez, the association had about $24,000 in the bank when she and her husband started their terms. It now has about $42,000, she said.

"That's important because we have people who want to hook up to the system and can't," Tina Gutierrez said. "We need to expand the system so the community can grow, and we have to borrow the money from the USDA. In order to do that, we have to have our books in order. I think we're there now."