Laserfiche WebLink
Audit Results <br />Cash handling internal controls at Mass Transit are inadequate <br />and ineffective to ensure that revenue is properly controlled and <br />deposits are timely and accurate. As a result, we are unable to <br />determine if cash receipts were complete. <br />Management is responsible for an effective internal control system. Internal controls should be <br />designed to provide reasonable assurance on the effectiveness and efficiency of operations, <br />reliability of financial reporting, and compliance with applicable laws and regulations. Internal <br />controls can help achieve performance targets and prevent loss of resources. An organization's <br />internal control structure over cash handling operations should include the following controls: <br />• Physical Safeguarding of Assets. Assets should be physically protected from loss and <br />unauthorized use. <br />• Segregation of Incompatible Duties. Duties should be segregated amongst employees <br />so that errors and irregularities made by one employee are difficult to conceal. <br />• Independent Review and Monitoring. Management should document their review and <br />approval of critical tasks performed by employees. They should not review and approve <br />their own work. <br />An organization's management should incorporate these controls into written policies and <br />procedures. These policies and <br />procedures should cover all Summary of Internal Controls <br />aspects of operations, be <br />sufficiently detailed, and be <br />distributed to staff. In addition, <br />ongoing monitoring is necessary to <br />ensure policies and procedures, <br />and internal controls, remain <br />effective and efficient as operations <br />change. <br />The Department of Finance's <br />Accounting Manual requires each <br />County department to establish Source: Data compiled by the Office of the Legislative Auditor <br />internal controls to ensure cash is Table 1 <br />safeguarded, accounted for, and <br />properly recorded. Our audit evaluated Mass Transit's cash handling procedures and we found <br />that internal controls are generally inadequate and ineffective to ensure that revenue is properly <br />Best Practice <br />Was it <br />Performed? <br />Safeguarding of Assets including: <br />• Physical security <br />No <br />• Timely deposits/reporting <br />Independent Monitoring <br />No <br />Segregation of duties <br />No <br />Written Policies and Procedures <br />Inadequate <br />Mass Transit Cash Handling Audit Results 17 <br />