Finding Text
Federal Program: Assistance Listing #14.871 - Section 8 Housing Choice Vouchers.
Criteria: The green book requires internal control and segregation of duties.
Condition: The Housing Authority of the City of Greeley did not utilize staff to adequately segregate duties. Internal controls have not been designed to allow for preparation processes and then segregated review processes. Specifically, segregation of duties was not present for the payroll functions, bank reconciliations and journal entries.
Questioned Costs: None.
Cause: The lack of adequate policies and procedures regarding segregation of duties can be attributed to management's oversight. Management has not established the necessary internal controls to ensure proper accountability and oversight.
Effect: Increased risks of errors and potential fraud within key functions such as payroll, bank reconciliations, and journal entries.
Recommendation: We recommended the Authority develop clear policies that define roles and responsibilities, ensuring clear segregation of duties across all critical functions. Hiring additional staff or reassigning existing staff to ensure that no individual has control over multiple critical functions. Create a review process where management or a designated committee regularly reviews key functions to ensure adherence to policies.
Management’s Response: Management will adopt policies and procedures that will enhance the segregation of duties with the accounting functions.