2018-01 Performance Audit Report: Cash Handling at County of Hawai'i's Mass Transit Agency

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1.3 We further recommend Mass Transit remove or alter the perforated stub at the top of the bus ticket sheets to ensure passengers pay the full fare. Response: The MTA is currently reviewing current practice, and identifying feasible options to minimize this issue. The MTA is also addressing this issue of minimizing the acceptance of non -valid payment with the contracted bus companies. 2. Cash handling internal controls should be a priority 2.1 We recommend Mass Transit management prioritize cash handling internal controls. Management should be responsible for an effective internal control system and internal controls increase the likelihood that the organization will achieve their objectives. Response: Although the MTA agrees that improvements are needed to strengthen its internal controls over the handling of cash, the management of MTA has implemented various improvements in the past year and a half because it understands the importance of this issue. The Legislative Auditor's report indicates that "Muss Transit received funding far an additional position to count hus fare cash receipts and prepare the hank deposit. While this positlon was filled in 2016 only one person was assigned to count cash. " MTA received funding for this position on July 1, 2016 and this position was filled on November 1, 2016. Later, the MTA began to require the presence of two staff members as the cash was counted and prepared for deposit and then effective February 7, 2018, the MTA now requires two employees to participate in the counting and recounting of the cash. 3. Safeguard Assets 3.1 We recommend Mass Transit management ensure physical security over manual receipts, cash, and cash equivalents (e.g., bus tickets, bus passes, taxi coupons). Response: The audit report states that "some county-om,ned vans do not have locking_ fare boxes. When there is no fiare box, a manila envelope or plastic hag is used. " All vans have locked cash boxes that have been redesigned to include a slot to allow for the insertion of payment. The MTA has already established adequate security upgrades and enhancements to address this issue, including secured rooms, video camera, and limited access. 3.2 We further recommend Mass Transit management ensure deposits are made timely, both for contracted bus services and cash received by Mass Transit. Ideally, deposits should be made within 24 hours, but at least within two business days. Response: The MTA has taken the necessary steps to ensure that cash deposits are made within the two business day requirement and implemented changes to facilitate the timely delivery of funds from the contracted bus service companies. Mass Transit Agency — Cash Handling Management's Response Page 2 Mass Transit Cash Receipts Management's Response 130