Finding Text
Finding #2022-001 – Lack of Segregation of Duties
Condition: The limited size of the District’s staff prevents the ideal separation of functions. The bookkeeper prints accounts payable checks, has access to the password to print electronic signatures and performs bank reconciliations. The bookkeeper also performed all payroll functions during the year.
Effect: Because of the lack of segregation of duties, errors or irregularities could occur and not be detected on a timely basis.
Cause: Limited number of personnel.
Criteria: Internal controls should be in place that provides adequate segregation of duties.
Recommendation: Procedures should be implemented segregating duties among different employees. Management should continue to maintain a working knowledge of matters relating to the District’s operations.
Response: We agree with this finding but do not believe it is cost effective to increase the office staff in an attempt to bring about a more effective segregation of duties. The board reviews and approves all expenditures on a monthly basis prior to mailing accounts payable checks.