2016-01 Performance Audit Report: Cash Handling at County of Hawai'i's Department of Parks and Recreation

Home

At the time of our audit, the Hilo office was taking corrective measures with the Department of Finance to create a separate general ledger account to move Hilo's facility use permit revenue to a separate account. • There is no review for consecutiveness or completeness of permit numbers. The Clerks at both Hilo and Kona use a computer template to complete the permit and assign a permit number. Controlling and reviewing pre -numbered and carbon copied receipts helps deter and detect potential theft of cash receipts. Monitoring is an integral component of internal controls; unmonitored controls tend to deteriorate over time. When monitoring is designed and implemented appropriately, organizations are more likely to identify and correct problems on a timely basis. Ongoing monitoring can occur in the course of daily operations including regular management and supervisory activities including comparisons, reconciliations, and other routine actions. There should always be another level of review and approval performed by a knowledgeable person independent of the process. A thorough review of the processes will help with accuracy, completeness, and timeliness. The reviewer should be someone who is knowledgeable in daily operations, has the authority to make decisions, someone who does not perform the process and document evidence of review by a signature or initials and date. Written policies and procedures are incomplete, insufficiently detailed, and not consistently followed The Government Finance Officers Association (GFOA) establishes best practices including written policies and procedures that are reviewed on an annual basis. The development of written departmental policies and procedures are an effective way to maintain a strong system of internal controls. Policies and procedures should clearly delineate the control activities performed throughout various business processes. This will aid in the orientation of new employees, help ensure business continuity in the event of turnover, and help ensure compliance with applicable laws and regulations. At the County of Hawaii, each department and agency is responsible for creating and maintaining their own policies and procedures by using the Department of Finance's Accounting Manual as a basis for establishing an adequate system of internal controls. The Department of Parks and Recreation created cash receipting policies and procedures in 2002 and then updated them on August 13, 2015. However, P&R management did not Department policies and procedures should be clarified so employees are not subject to risk. have on-going and continuous monitoring of their policies and procedures in order to remain effective and efficient as operations change. As a result, the current cash receipting policies and procedures do not provide adequate guidance to P&R staff. Cash Handling for Facility Use Permits: Audit Results 19