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Valerie T. Poindexter Bonnie S. Nims, CGAP <br />J�iv of 114 Legislative Auditor <br />Chair &Presiding Officer o . <br />Council District I <br />Business Address <br />$>�tF•oF µA;�¢� <br />120 Pauahi Street <br />Suite 309 <br />f� �`Pubjul"i <br />Hilo, Hawaii 96720 <br />W.Alunt Q4 <br />OFFICE OF THE LEGISLATIVE AUDITOR <br />25 Aupuni Street Hilo, Hawaii 96720 * (808) 961-8386 * Fax (808) 961-8905 <br />website: h9p:11hawaiicounty.gov e-mail: publiclao(aco.hawaii.hi.us <br />April 30, 2018 <br />The Honorable Valerie T. Poindexter, Council Chairperson and <br />Members of the Hawaii County Council <br />Hawaii County Council <br />25 Aupuni Street <br />Hilo, Hawaii 96720 <br />Dear Chair Poindexter and Council Members, <br />In accordance with Hawaii County Charter Section 3-18(d)(2), attached is the Office of the <br />Legislative Auditor's report of our audit of cash handling at the Hawaii County Mass Transit <br />Agency (Mass Transit). The purpose of the audit was to determine if cash handling internal <br />controls at Mass Transit are adequate and effective to ensure that revenue is properly controlled <br />and deposits are timely and accurate. We evaluated if these internal controls followed best <br />practices and identified areas for improvement. <br />In fiscal year 2016-2017, Mass Transit receipted approximately $1.2 million in bus fares and <br />shared ride taxi coupons (taxi coupons). Management of such a significant revenue stream <br />makes it important for Mass Transit to have sound controls to safeguard revenue. As described <br />in the attached report, Mass Transit needs to develop stronger cash handling internal controls to <br />ensure that revenue is properly controlled and deposits are timely and accurate. Specifically, <br />Mass Transit needs to update the bus cash handling system and increase the priority of cash <br />handling internal controls. These internal controls include physically securing their assets, <br />segregating incompatible duties, implementing monitoring and oversight procedures, updating <br />and enforcing policies and procedures, and providing training. We also found Mass Transit <br />needs to improve their control over manual cash receipts and their purchase order sales process. <br />Through stronger internal controls and monitoring, Mass Transit will be able to improve its <br />collection, safeguarding, and accounting for its transportation revenue. Our report lists several <br />related recommendations. <br />Hawai'i County is an Equal Opportunity Provider and Employer <br />