Follow-up Audit on the Financial Practices of the Office of the Actuary

AUDIT REPORT IN BRIEF

This audit determined whether the OA has implemented the nine recommendations made in an earlier audit, Audit Report on the Financial Practices of the Office of the Actuary, (#ME04-077A), issued June 30, 2004.

Audit Findings and Conclusions

Of the nine recommendations made in the previous audit the OA implemented six recommendations, partially implemented two, and was not able to implement one.

The six recommendations that were fully implemented pertain to updating the inventory list and conducting periodic counts of all physical assets, preparing and maintaining purchase requisitions and receiving reports, using miscellaneous vouchers for allowable purposes, preparing purchase requisition for imprest fund purchases, and ensuring that employees sign for their paychecks. The two recommendations that were partially implemented pertain to having adequate procedures to ensure that duties within the purchasing and the timekeeping/payroll functions are sufficiently segregated and developing a complete inventory list. The one recommendation that was not implemented pertains to ensuring that all employee time reports are signed by the preparer, supervisor, and data entry operator.

In addition to following up on the earlier recommendations, we identified two new findings. Specifically, the OA permitted its employees to accumulate annual leave balances in excess of the maximum amount provided for by City guidelines and did not ensure that the individual responsible for paycheck distribution sign the Payroll Management System’s Paycheck Distribution Control Report (PDCR).

Audit Recommendations

To address the issues that still exist, as well as the new issues noted, we recommend that the OA should:

• More consistently implement its procedures to ensure that the duties within the purchasing and the timekeeping-payroll functions are sufficiently segregated.
• Ensure that pre-numbered inventory tags are affixed to all items.
• Include the tag number and serial number for all items on the inventory list.
• Ensure that all ETRs are signed by the preparer, the supervisor, and the PMS data entry operator.
• Convert excess annual leave to sick leave at the end of each leave year unless it authorizes the carryover in writing in accordance with DCAS rules and leave regulations.

Ensure that the PDCR is certified on each page.