Follow-up Audit Report on the Civil Service Commission’s Financial and Operating Practices

Executive Summary

The objective of this audit was to determine whether the Civil Service Commission (CSC) implemented the seven recommendations made in the prior audit report relating to the audit of its financial and operating practices.

The CSC is an independent, non-mayoral agency that hears and renders decisions on appeals by candidates who were disqualified and removed from an eligible civil service employment list and appeals by City employees on disciplinary matters. A majority of the appeals can be classified within one of two categories:

• Appeals by applicants or appointees who have been disqualified from a civil service appointment based on character, medical, psychological, or other reasons; or
• Appeals by City employees who have been disciplined for misconduct or incompetence.

A prior New York City Comptroller’s Office audit was conducted to determine whether the CSC maintains reliable and effective internal control systems over cash receipts, expenditures, and inventory as required by the New York City Comptroller’s Directives. The audit found various internal control weaknesses related to the CSC’s financial and operating practices; see Audit Report on the Civil Service Commission’s Financial and Operating Practices (Audit #FK17-070A), issued on June 23, 2017. The audit report included seven recommendations to address the internal control weaknesses found. In this report, we discuss the implementation status of each of those seven recommendations.

Audit Findings and Conclusion

Of the seven prior audit recommendations, we determined that the CSC implemented three recommendations, partially implemented three recommendations, and did not implement one recommendation. Specifically, the CSC implemented recommendations that it: maintain accurate and complete inventory records; charge purchases to the correct object codes; and carefully review its prior and current Comptroller’s Directive #1 Agency Evaluation of Internal Controls to ensure their accuracy in all respects. In addition, the CSC partially implemented the three recommendations pertaining to inventory practices and segregation of duties for purchasing and inventory. Finally, the CSC did not implement the recommendation to document policies and procedures for inventory in writing and communicate them to staff.

Audit Recommendations

Based on the audit, we made three recommendations, including that the CSC should:

1. Document and separately maintain the results of periodic inventory counts.
2. Further segregate the duties of preparing purchase requests, approving payments, and maintaining inventory records. The CSC should implement compensating controls if the recommended segregation of duties is not possible.
3. Include policies and procedures for inventory in the CSC’s current Administrative Procedures.

Agency Response

In its response, the CSC generally agreed with the three recommendations and outlined the actions it has taken, and plans to take, to implement each of them.