Criteria - A primary control over cash is the timely and accurate reconciliation of all cash accounts. The
County was unable to reconcile the claim on cash for the operating account with the pooled cash fund.
Additionally outstanding items in the closed pooled cash account were not cleared timely.
Reconciliations of the County’s cash accounts which is a requirement of Texas Local Government Code,
Sec. 113.008, Reconciliation of Depository Accounts.
Condition – Claim on cash did not reconcile to the pooled cash account by a material degree until
corrections were made during the audit.
Effect – Inaccurate financial information was provided to Commissioners’ Court as the bank
reconciliations were not performed timely.
Cause – The former Treasurer was unable to reconcile the bank accounts on a timely basis which caused
the issue to persist into the current fiscal year.
Recommendation - The County Treasurer and assistants should receive training in reconciling bank
accounts (with continued support from outside professionals, if necessary), until all bank accounts are
reconciled on a timely basis and tie to the general ledger.
Criteria - A primary control over accurate financial statements is the timely and accurate recording of
each receipt of revenue to the appropriate revenue account within the accounting software.
Condition – The Treasurer’s Deputy Clerk posts the daily receipts to a general receivable account in the
accounting software rather than the appropriate revenue account in the accounting software. The County
Auditor’s department then allocates the revenue to the appropriate account by journal entry.
Effect – Inaccurate financial information was provided to Commissioners’ Court as revenue was
recorded to the accounts receivable account rather than the revenue account in the accounting software
system. Therefore, revenues were understated throughout the year.
Cause – The Treasurer is recording the revenue as a receivable in the balance sheet account rather than a
revenue in the Statement of Revenues and Expenditures. The County Auditor is then correcting the
entries at a later date.
Recommendation – The County Treasurer should be posting all revenues to the appropriate accounts on
the Statement of Revenues and Expenditures. They should only post to the Balance Sheet accounts when
transactions are directly related. Segregation of duties should be improved and staff should be
appropriately trained to avoid excessive journal entries. The auditor’s office should be auditing these
transactions not performing them. The County Treasurer and assistants should receive additional training
in recording revenue (with continued support from outside professionals, if necessary), until revenue is
recorded correctly within the software system.
Criteria –The Auditor’s Office should not be able to create new vendors, and set up new employees
Condition – Multiple employees at the auditor’s Office can change their permissions in the software that
would allow them to set up or change vendor information, create and then approve vendor payments, set
up new employees, change employees direct deposit information and approve payroll.
Effect – Misappropriation could occur as well as inaccurate information provided in the financial
statements.
Cause – The accounting system has been set up where multiple employees in the Auditor’s Office have
permissions that they should not.
Recommendation – The County should contact IT to relinquish certain permissions from employees to
ensure reestablish proper segregation of duties between the Treasurer’s Office and the Auditors.
Criteria - A primary control over accurate financial statements is the reconciliation of the subsidiary
accounts to the general ledger.
Condition – The County Auditor is charged with maintaining the records of the County’s financial
transactions including the general ledger. We noted numerous balance sheet accounts are not being
reconciled to the supporting subsidiary ledgers and accounts. This includes accruals such as receivables
and liabilities, as well as, interfund transactions including due to/from and transfers.
Effect – Inaccurate financial information was provided to Commissioners’ Court. Additionally, the
balance sheet accounts were either over or understated.
Cause – Subsidiary Ledgers are not being compared to the corresponding general ledger accounts in the
accounting software system by the County Auditor’s Office.
Recommendation – Supporting subsidiary ledgers and accounts should be prepared by the appropriate
department/personnel, such as the elected official, purchasing agent or grant coordinator and then audited
and reconciled to the general ledger by the County Auditor’s office. There has been improvement in this
area in the past year.
Criteria - A primary control over cash is the timely and accurate reconciliation of all cash accounts. The
County was unable to reconcile the claim on cash for the operating account with the pooled cash fund.
Additionally outstanding items in the closed pooled cash account were not cleared timely.
Reconciliations of the County’s cash accounts which is a requirement of Texas Local Government Code,
Sec. 113.008, Reconciliation of Depository Accounts.
Condition – Claim on cash did not reconcile to the pooled cash account by a material degree until
corrections were made during the audit.
Effect – Inaccurate financial information was provided to Commissioners’ Court as the bank
reconciliations were not performed timely.
Cause – The former Treasurer was unable to reconcile the bank accounts on a timely basis which caused
the issue to persist into the current fiscal year.
Recommendation - The County Treasurer and assistants should receive training in reconciling bank
accounts (with continued support from outside professionals, if necessary), until all bank accounts are
reconciled on a timely basis and tie to the general ledger.
Criteria - A primary control over accurate financial statements is the timely and accurate recording of
each receipt of revenue to the appropriate revenue account within the accounting software.
Condition – The Treasurer’s Deputy Clerk posts the daily receipts to a general receivable account in the
accounting software rather than the appropriate revenue account in the accounting software. The County
Auditor’s department then allocates the revenue to the appropriate account by journal entry.
Effect – Inaccurate financial information was provided to Commissioners’ Court as revenue was
recorded to the accounts receivable account rather than the revenue account in the accounting software
system. Therefore, revenues were understated throughout the year.
Cause – The Treasurer is recording the revenue as a receivable in the balance sheet account rather than a
revenue in the Statement of Revenues and Expenditures. The County Auditor is then correcting the
entries at a later date.
Recommendation – The County Treasurer should be posting all revenues to the appropriate accounts on
the Statement of Revenues and Expenditures. They should only post to the Balance Sheet accounts when
transactions are directly related. Segregation of duties should be improved and staff should be
appropriately trained to avoid excessive journal entries. The auditor’s office should be auditing these
transactions not performing them. The County Treasurer and assistants should receive additional training
in recording revenue (with continued support from outside professionals, if necessary), until revenue is
recorded correctly within the software system.
Criteria –The Auditor’s Office should not be able to create new vendors, and set up new employees
Condition – Multiple employees at the auditor’s Office can change their permissions in the software that
would allow them to set up or change vendor information, create and then approve vendor payments, set
up new employees, change employees direct deposit information and approve payroll.
Effect – Misappropriation could occur as well as inaccurate information provided in the financial
statements.
Cause – The accounting system has been set up where multiple employees in the Auditor’s Office have
permissions that they should not.
Recommendation – The County should contact IT to relinquish certain permissions from employees to
ensure reestablish proper segregation of duties between the Treasurer’s Office and the Auditors.
Criteria - A primary control over accurate financial statements is the reconciliation of the subsidiary
accounts to the general ledger.
Condition – The County Auditor is charged with maintaining the records of the County’s financial
transactions including the general ledger. We noted numerous balance sheet accounts are not being
reconciled to the supporting subsidiary ledgers and accounts. This includes accruals such as receivables
and liabilities, as well as, interfund transactions including due to/from and transfers.
Effect – Inaccurate financial information was provided to Commissioners’ Court. Additionally, the
balance sheet accounts were either over or understated.
Cause – Subsidiary Ledgers are not being compared to the corresponding general ledger accounts in the
accounting software system by the County Auditor’s Office.
Recommendation – Supporting subsidiary ledgers and accounts should be prepared by the appropriate
department/personnel, such as the elected official, purchasing agent or grant coordinator and then audited
and reconciled to the general ledger by the County Auditor’s office. There has been improvement in this
area in the past year.