Finding Text
Finding #2022-001 - Segregation of Duties Condition: The District lacks segregation of duties in multiple areas such as, cash disbursements, payroll, and cash receipts. 1.) Cash disbursements ? The financial secretary has the ability to edit vendor master files and prepares checks. 2.) Payroll ? The financial secretary updates employee master files, runs payroll and sends direct deposit information to the bank. Criteria: Internal controls should be in place that provide adequate segregation of duties. Cause: The condition is due to limited staff available. Effect: Because of the lack of segregation of duties, errors or irregularities could occur and not be detected on a timely basis. 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. Cash receipt and disbursement procedures include multiple individuals and approvals. Specifically: ? Bank reconciliations are reviewed and approved monthly by the District Administrator. ? Bank deposits are prepared by the HR/Finance Specialist, recorded by the Director of Business Services, and taken to the bank by the District Administrator. ? Payroll is prepared by the HR/Finance Secretary, approved by the Director of Business Services, and released from the bank by the District Administrator. ? The HR/Finance Secretary has the ability to request journal entries, but requests must be approved and posted by the Director of Business Services.