FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
BANK RECONCILIATIONS ARE NOT RECONCILED TO THE
GENERAL LEDGER
Bank statements are reconciled monthly, however, they are
not reconciled to the general ledger cash accounts. Several deposits were incorrectly posted to the general ledger. The general ledger did not agree to the reconciled
bank balance by $21,788 at June 30, 2003.
Bank reconciliations should agree to the cash accounts in
the general ledger (Finding 03-1, page 11)
The Regional Office of Education #41 accepted the
recommendation. The Accounting Assistant
will perform the bank reconciliations
and the Head Accountant will verify all reconciliations are balanced and
accurately reflected on the general ledger.
The Assistant Regional Superintendent will ensure all reconciliations
are performed and balanced.
INACCURATE GENERAL LEDGER
The general ledger was inaccurate and did not agree to
the State reported revenues. The
differences comprised of a deposit for $9,321 that was not posted, a deposit
for $7,441, which was posted incorrectly to two funds, and a deposit for
$6,118, which was incorrectly posted twice.
The general ledger totals should agree or be reconciled
to the grant report totals for all grants (Finding 03-2, page 12).
The Regional Office of Education #41 accepted the
recommendation and will ensure that the revenues and expenditures per the
general ledger agree with the granting agency.
INADEQUATE INTERNAL CONTROLS OVER CASH
DISBURSEMENTS
The same person has the responsibility for inputting
invoices for payment, the ability and the authority to print the checks, and
access to a signature stamp to “sign” the checks without proper review or
oversight. Without the proper
segregation of duties over cash disbursements, the Regional Office of
Education is susceptible to unauthorized or fraudulent payments with little
chance of detection. Someone should
be reviewing all checks and agreeing the checks to invoices, as part of the
signatory process, before the checks are mailed to the vendors.
The Regional Superintendents of Schools is responsible for
establishing and maintaining an internal control system to prevent errors
and/or irregularities (Finding 03-5, page 15).
The Regional Office of Education #41 accepted the
recommendation and will establish an internal control system to prevent
errors and/or irregularities. At a
minimum, the responsibility for inputting invoices for payment will be
segregated from the printing and signing of checks. In addition, all checks and agreeing invoices will be reviewed
as part of the signatory process before checks are mailed to the payee.
INADEQUATE CONTROLS OVER PROPERTY
The Regional Office of Education #41 does not maintain
detailed fixed asset records. There
is no policy in place which requires any purchases of fixed assets made
throughout the year to be recorded in the present fixed asset system. Also, there is no policy for assets to be
numerically tagged for proper accountability and control.
The ROE Accounting Manual requires each ROE to maintain
detailed fixed asset records for both accounting purposes, as well as
insurance purposes, for fixed assets costing $500 or more. (Finding 03-6, pages 16-17)
The
Regional Office of Education #41 accepted the recommendation and will
implement an asset tagging system.
Once the tagging system is in place, a detailed listing of all fixed
assets can be generated and depreciation will be calculated. Any assets purchased will now be tagged at
the time of delivery and entered into the detailed fixed asset system. An annual physical inventory of all assets
will be conducted.
OTHER FINDINGS
The remaining findings are reportedly being given
attention by Regional Office of Education #41. We will review progress toward the implementation of our recommendations
during the next audit.
AUDITORS’ OPINION
Our auditors state the Regional Office
of Education #41’s financial statements as of June 30, 2003 are fairly
presented in all material respects.
_____________________________________
WILLIAM
G. HOLLAND, Auditor General
WGH:JRB
SPECIAL ASSISTANT AUDITORS
Our special assistant
auditors were J.W. Boyle & Co., Ltd.
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