Audit Report on the Cash Controls and Timekeeping Practices at the New York City Clerk’s Manhattan Office

AUDIT REPORT IN BRIEF

This audit of the New York City Clerk’s Manhattan Office (City Clerk’s Office) covered its cash controls and timekeeping practices. The City Clerk and Clerk of the Council (the City Clerk) is responsible for administering the Marriage Bureau in all five boroughs, keeping official records, and serving as clerk to the City Council and as the custodian of the City Seal. In Fiscal Year 2002, the City Clerk’s offices throughout the five boroughs had revenues of $3.6 million and expenses of $2.7 million, thereby generating a total of $0.9 million for the City.

The City Clerk’s Office has adequate internal controls over its payroll and timekeeping functions and is in compliance with applicable rules of Comptroller’s Directive #13, Payroll Procedures. In addition, the City Clerk’s Office generally adheres to the guidelines for internal controls established by Comptroller’s Directive #11, Cash Accountability and Control. Our audit determined that the City Clerk’s Office accepts only money orders and business checks from the public as payment for its services; issues computer-generated, sequentially numbered receipts; and makes daily deposits in the bank. Also, the deposits are reconciled by the City Clerk’s Office to the amounts recorded in the City’s Financial Management System. However, we identified several internal control weaknesses, including:

• Inadequate controls over blank marriage certificates and licenses;
• Lack of reconciliation of fees collected with fees deposited;
• Inadequate safeguarding of mail requests and cash receipts;
• Lack of segregation of duties in Commissioner of Deeds unit; and
• Improper maintenance of voided documents.

To address these issues, we make 13 recommendations. Among them, we recommend that the City Clerk’s Office:

• Develop and maintain an inventory system to track blank marriage certificates and licenses.
• Enter in the Marriage License System (MLS) system the pre-printed number on a marriage certificate or license whenever a form is issued.
• Train and instruct employees to properly enter all voided documents in the MLS.
• Issue a written procedure requiring that the Daily Cash Report be reconciled with the daily cash receipts before the cash is deposited in the bank. In addition, all discrepancies found during the reconciliation should have a written explanation and a supervisory signature next to the explanation.
• Issue a written procedure requiring a second signature on the cash deposit slip to verify that an independent count of the cash was performed.
• Issue a written procedure that requires mail requests and cash receipts to be secured in a locked drawer or safe at the end of the day.
• Deposit all money orders on the day that they have been received in the mail by the Record Room or, if necessary, no later than on the next business day.
• Train more than one employee to handle Commissioner of Deeds transactions.
• Require that all in-person cash payments by customers be made to the Cashier’s unit, not to the Commissioner of Deeds unit.

The City Clerk’s Office generally agreed with the audit’s recommendations and has implemented 10 of the 13 recommendations. The Office stated that it is currently implementing two others and is exploring the possibility of implementing the remaining recommendation in the future.