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Home My WebLink AboutFollow-up report on Extension 4-HReport# 05/06-8 (Dated April 13, 2006) Follow-up on Extension and 4-H County Service District - Review of Internal Controls Over Receipts (Internal audit report #04/05-8 issued July 22, 2005) Presented to the Deschutes County Audit Committee by the Internal Audit Program David Givans, CPA – County Internal Auditor Report# 05/06-8 Dated April 13, 2006 Deschutes Count y, Oregon Report# 05/06-8 (Dated April 13, 2006) {This page left blank} Report# 05/06-8 (Dated April 13, 2006) To: Audit Co mmittee CC: Mike Daly, Bev Clarno, Theresa Hogue - Extensio n 4-H From: David Givans, Count y Internal Auditor Subject: Fo llow-up on audit of Extensio n 4-H (Report #04/05-8) Date: April 13, 2006 This fo llow-up report covers the performance review of Extensio n 4-H as covered in Internal Audit Report #04/05-8. The audit covered internal controls over receipts and was issued July 22, 2005. This fo llow-up report was compiled fro m informatio n provided by Extensio n 4-H. Deschutes Count y, Oregon Internal Audit Program David Givans, CPA, CIA County Internal Auditor Deschutes County- Administrative Services 1300 NW Wall Street, Suite 200 Bend, OR 97701 Phone: 541-330-4674 Fax: 541-385-3202 davidg@co.deschutes.or.us Report# 05/06-8 (Dated April 13, 2006) {This page left blank} Report# 05/06-8 (Dated April 13, 2006) Follow -up on Extension 4-H - Review of Internal Controls Over Receipts (Internal audit report #04/05-8 issued July 22, 2005) TABLE OF CONTENTS: 1. INTRODUCTION 1.1. Background ……………………………………………………………………….... 1 1.2. Object ives & Scope ……………………………………………………………...… 1 1.3. Methodology ……………………………………………………………………….. 1 2. OVERVIEW of FOLLOW-UP RESULTS …………………………………….. 1-2 3. Appendix 3.1. Appendix I –Extensio n 4-H internal audit recommendaitons workplan and status of recommendat ions ………………………………......…………........ 2-4 Report# 05/06-8 (Dated April 13, 2006) 1 1. INTRODUCTION 1.1 BACKGROUND Audit Authorit y: The Deschutes County Audit Committee has suggested that follow-ups occur within nine mo nths of the reports. The Audit Co mmittee’s would like to make sure depart ments satisfactorily address recommendat ions. 1.2 OBJECTIVES and SCOPE Object ives: The object ive was to follow-up on recommendat ions ident ified in the audit report performed for the Finance department. Scope: The fo llow-up included all pert inent recommendat ions made in the original internal audit report (#04/05-8) covering internal controls over receipts (issued July 22, 2005). 1.3 METHODOLOGY The fo llow-up report was developed from informatio n provided by Darlene Belden, Office Manager. In cases where the recommendations had not been implemented, these were noted and the explanation. The fo llow-up is, by nature, subject ive. In determining the status of recommendat ions that were fo llowed up, we relied on assert ions provided by those invo lved and did not attempt to independently verify those assert ions. Since no substant ive audit work was performed, Government Auditing Standards issued by the Comptroller General o f the United States were not fo llowed. 2. Overview of Follow-up Results We fo llowed up on 26 recommendations made in the report. Figure I provides a breakdown of the status of these recommendations. All reco mmendat ions have been implemented or are in the process of being implemented. See Appendix I for the completed workplan, which outlines Extensio n 4-H’s response and implementation status. Report# 05/06-8 (Dated April 13, 2006) 2 Figure I - How were recommendations implemented? Implemented 96% Implementation underway 4% 3. Appendix 3.1 Appendix I – Extension 4-H’s workplan and status of recommendations (as of 4-10-06) A g r e e D i s a g r e e C o m p l e t e d U n d e r w a y P l a n n e d Estimated or Actual Date of Completion Comments X X Completed 10-05 X X Completed 10 -05 X X Completed 10-05 X X Completed 10-05 X X Completed 1-06 X X Completed 11-05 a. The office manager should track the receipt numbering to assure they have received monies for all of the receipts issued X X Completed 11-05 b. The receipt books used by District staff should have the name of the District on them so it is clear who received the monies. X X Completed 11-05 Implementation Status Recommendations #04/05-8 Extension 4-H Review of Internal Control over Receipts 1. It is recommended the monies, receipted on behalf of other organizations, be accounted for until deposited and locked up. For non- profit organization monies, the underlying accounting should be provided to the organization with a copy to the bookkeeper 6. It is recommended the District obtain and utilize receipt books conforming to County policy. From discussions with staff, it appears the receipt book should be in triplicate so one can be provided to the customer, one can be retained, and one can be p 2. It is recommended for monies held at the end of the day to be secured in a safe or locking file cabinet. Tamperproof bank bags may be utilized for counted and reconciled monies. 3. It is recommended that District staff establish procedures to deposit all District monies on a daily basis in accordance with County policy. 4. It is recommended that OSU monies received to be deposited in accordance with those policies, which is probably weekly but at times may be daily. 5. As discussed further in this report, an agreement should be made with non-profit organizations as to the expected time frame for delivery of deposits to the Bank or delivery to one of their officers. It is recommended for this to be daily but no great Report# 05/06-8 (Dated April 13, 2006) 3 A g r e e D i s a g r e e C o m p l e t e d U n d e r w a y P l a n n e d Estimated or Actual Date of Completion Comments X X Completed 10-05 X X Completed 11-05 X X Completed 11-05 X X 7/22/2005 X X Completed 11-05 X X Completed 1-06 X X Completed 1-06 X X Completed 1-06 X X Completed 12-05 This office will not be making Leaders Assoc. deposits as per OSU policy. Agreed on all others X X N/A This office will not be making Leaders Assoc. deposits as per OSU policy. X X Completed 1-06 a. The check stock should be controlled by recording the stock on hand and maintaining a list of issued check numbers. X X No longer in office X X Completed 1-06 X X Completed 1-06 X X Completed 10-05 a. Each day the drawer should start only with the authorized change funds of $10 and should be verified by custodian of those monies. X X Completed 10-05 20. It is recommended change monies be secured. Monies in excess of the authorized $10 should be deposited. 16. It is recommended that District services to non-profit organizations, in regards to receipting of monies, be limited to making timely deposits to authorized bank accounts. Other services might be contemplated given appropriate controls and agreement. 17. It is recommended that any check stock retained be maintained in a locked file cabinet. 18. It is recommended for District staff to leave collection and scholarships decisions to the associated non-profit organization. 19. Volunteer coordinator utilizes credit cards with District name for 4- H business. It is recommended these cards be destroyed. It would be better if the 4-H Leaders Association established appropriate policies and guidelines for handling of volunteer p 12. It is recommended the District consider developing operational agreements with non-profit organizations to better define the nature and extent of services that can or will be provided and the coordination of those services to fulfill the District’s purpose. 13. It is recommended District staff document their accounting policies and procedures. 14. It is recommended the District not be the direct recipient of 4-H Leaders Association bank statements. It is recommended that District staff transition, as soon as possible, the accounting duties to the 4-H Leaders Association or their contracted boo 15. It is recommended the District provide an accounting of monies received and deposited on behalf of any non-profit organizations. #04/05-8 Extension 4-H Review of Internal Control over ReceiptsImplementation Status Recommendations 7. It is recommended that monies, received by mail, be logged into a schedule (probably by the office manager) so that monies may be reconciled through to deposits. This log may be computerized and used to aggregate monies collected by organization. A r 8. It is recommended the monies received be deposited intact to Deschutes County 4-H Leaders Association and then an invoice submitted for the amount due to OSU for publication costs. 9. It is recommended District staff endorse all incoming checks when the mail is opened or upon receipt. 10. It is recommended the District obtain a County endorsement stamp for the District. 11. It is recommended the District work with non-profits organizations, they receive monies for, to identify what endorsement stamps are needed. Report# 05/06-8 (Dated April 13, 2006) 4 A g r e e D i s a g r e e C o m p l e t e d U n d e r w a y P l a n n e d Estimated or Actual Date of Completion Comments X X Completed 1-06 X X Current Supervisor has been traveling and will be replaced. It is anticipated the new supervisor will be able to perform this function. Count 26 0 25 1 0 Percentage of total (%)100%0%96%4%0% #04/05-8 Extension 4-H Review of Internal Control over ReceiptsImplementation Status 21. It is recommended the District consider consolidating procedures and software to account for monies being received. 22. It is recommended a supervisor periodically reconcile deposits to registration information entered. Recommendations {END OF REPORT - This page left blank}