Finding Text
Lack of segregation of duties - Significant Deficiency Criteria: For an effective control system, division of accounting duties should exist to prevent errors or misappropriations from going undetected in the course of employees performing their assigned duties. No one individual should have more than one duty related to approval, custody of assets, record keeping, and reconciliation functions. Condition: The City does not have enough staff to adequately separate duties in all financial transactions. Context: The lack of segregation of duties exists within the City as a whole over all of its accounting and reporting functions. This is a common circumstance in governments of similar size. Cause: LImited number of staff avasilable to appropriately divide duties. Effect: Errors or misappropriations could occur and go undetected for a period of time. Questioned Costs: Not applicable. Recommendation: The City's council members need to be cognizant of the issue and provide appropriate oversight. Such oversight includes careful review of bank activity as well as general ledger and journal entries. The council members should also peridodically perform on site inspections of assets and financial records. Views of Responsible Officials and Corrective Actions: The City agrees with the recommendations and continues to provide oversight as needed.