Finding Text
Finding #2023-001 - Segregation of Duties (Prior year finding #2022-001)
Condition: The limited size of the District’s office 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.
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: Checks and balances should be in place to allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct any misstatements 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. The Board reviews and approves all expenditures on a monthly basis prior to mailing accounts payable checks.