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HomeMy WebLinkAboutFollow-up of Property and Facilities Cash HandlingFollow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 FOLLOW-UP REPORT Property & Facilities Cash Handling (Internal audit report #11/12-12 issued September 2012) To request this information in an alternate format, please call (541) 330-4674 or send email to David.Givans@Deschutes.org Deschutes County, Oregon David Givans, CPA, CIA, CGMA Deschutes County Internal Auditor 1300 NW Wall St PO Box 6005 Bend, OR 97708-6005 (541) 330-4674 David.Givans@Deschutes.og Audit committee: Gayle McConnell, Chair - Public member Chris Earnest - Public member Jean Pedelty - Public member Michael Shadrach - Public member Jennifer Welander - Public member Anthony DeBone, County Commissioner Nancy Blankenship, County Clerk Dan Despotopulos, Fair & Expo Director Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 TABLE OF CONTENTS: 1. INTRODUCTION 1.1. Background ………………………………………...………………................................... 1 1.2. Objectives & Scope ……………………………………..………………………….…….… 1 1.3. Methodology ……………………………………………………..…………………….……. 1 2. FOLLOW-UP RESULTS ……………….…...………………………….............................. 2 3. APPENDIX I – Internal Audit Recommendations - Updated Workplan for Report #11/12-12 (Status updated as of August 2013) ……….……...….................... 3-5 Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 Page 1 1. Introduction 1.1 BACKGROUND Audit Authority: The Deschutes County Audit Committee has suggested that follow-ups occur from nine months to one year after the original report issuance. The Audit Committee’s would like to make sure departments satisfactorily address recommendations. 1.2 OBJECTIVES and SCOPE Objectives: The objective was to follow-up on the outstanding audit recommendations. Scope: The follow-up included five (5) recommendations from the internal audit report on Property & Facilities - Cash Handling (#11/12-12) (issued September 2012). The follow-up reflects the status as of August 2013. The original internal audit report should be referenced for the full text of recommendations and discussion. 1.3 METHODOLOGY The follow-up report was developed from information provided by Susan Ross, Property & Facilities Director. In cases where recommendations have not been implemented, comments were sought for the reasons why and the timing for addressing these. The follow-up is, by nature, subjective. In determining the status of recommendations that were followed up, we relied on assertions provided by those involved and did not attempt to independently verify those assertions. Property & Facilities should be acknowledged for their work in addressing these recommendations. Since no substantive audit work was performed, Government Auditing Standards issued by the Comptroller General of the United States were not followed. DESCHUTES COUNTY INTERNAL AUDIT REPORT DESCHUTES COUNTY INTERNAL AUDIT REPORT DESCHUTES COUNTY INTERNAL AUDIT REPORT Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 Page 2 2. Follow-up Results Figure I - How were recommenda- tions implemented? The follow-up included five (5) recommendations. Management agreed with all of the recommendations. Figure I provides an overview of the implementation status of the recommendations. The details of the updated workplan are provided in Appendix I. With this follow-up, 2 of the recommendations (40%) have been sufficiently completed. Property & Facilities is working on the other 3 recommendations. Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 Page 3 3. Appendix Appendix I –Updated Workplan for Report #11/12-12 (Status as of August 2013) Rec# Recommendation text Agreement Updated Status Estimated Completion Date Updated Department Comments 1 It is recommended the department develop a process to better oversee all of the types of payments they may receive through to deposit with Finance. Implementation could be assisted by: • establishing a log for mailed-in checks that is prepared by a separate person from office staff; • improving the log of monies received to include the non-recurring transactions; and • a person not responsible for deposits should periodically reconcile Finance receipts to the log prepared. Agree Complete A procedure has been established to separate duties and verify receipt of monies: 1. All checks and cash received in the department are given to the property manager to log in (see attached log-in form); 2. Property manager logs in and returns monies to front office staff person; 3. Front office staff processes deposit to Finance; 4. Property manager provides the log of receipts to department director at the end of each week; 5. Department director verifies through financial program of deposits of all receipts for that week. 2 It is recommended for Property & Facilities to develop documentation of their accounting policies and procedures over their rents and other collections. The procedures should emphasize the areas of revenue and deposit handling, monitoring, supervision and segregation of duties. These policies and procedures should be available to all employees and should detail the responsibilities of each employee. Agree Complete Policy has been developed that describes the process in item #1 above. Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 Page 4 Rec# Recommendation text Agreement Updated Status Estimated Completion Date Updated Department Comments 3 It is recommended for the County to develop a policy for use of County facilities and how rents should be developed for internal and external tenants. • This policy may consider community contributions, costs to the County and needs by County departments when allowing for outside use of County building space. • A preference should be given for County departments to use available space, especially in County buildings when it can be contiguous with their other operations. • External market rates should be used when considering rent levels, as well as costs for depreciation, interest and other costs. Rents should be adequate to provide for significant repairs and improvements over the life of the property. • The County should seek (with non-County tenants) a market rental agreement. Maintenance, utilities and property taxes, if applicable, should be recovered or reimbursed. Agree Underway October 2013 Staff is working on developing a policy that will be taken to the Board for consideration. It is anticipated this discussion with the board will occur by the end of October 2013. In preliminary discussions with county administrative staff, the policy recommendation will be that we will try to get market rate when possible when leasing county space to tenants but that at other times, County may choose to subsidize the lease amount and will consider doing so on a case-by-case basis. 4 Based on the discussions from this year’s budget committee, it is further recommended for the County to consider an accounting and budgeting process for building usage costs to assure transparency, equity and fairness in costs and sufficiency to meet debt and future repairs. The County may also need to address in the solution the rules under OMB A-87 for cost allocations. Agree Underway October 2013 P&F and administrative staff will discuss with new finance director and pursue options to consider and recommendations for Board. Anticipated completion date is end of October 2013. Follow-up report on Property & Facilities Cash Handling #13/14-2 August 2013 Page 5 Rec# Recommendation text Agreement Updated Status Estimated Completion Date Updated Department Comments 5 The County should consider whether the benefits derived from the daycare facility balance with the associated costs of occupying a core County facility. A modest paid incentive to eligible staff desiring to use the daycare services (which would be compensable) may be more cost effective and provide greater value to the affected employees. Agree Underway March 2016 Administrative staff will recommend to the Board of Commissioners that the County weigh the benefits of the daycare facility when the lease agreement with the current provider expires March 2016. {END OF REPORT}