Unannounced Audit of Petty Cash and Change Funds, July 2019

6 | U n a n n o u n c e d A u d i t o f P e t t y C a s h a n d C h a n g e F u n d s J u l y 2 0 1 9 1. Segregation of Duties Requirement Observation Accounting Policies and Procedures, Chapter 9.5 Change Funds and Chapter 17.2 Petty Cash state that “only the person designated the custodian is permitted access to the change fund, unless the use of compensating controls are authorized by the Finance Department of the Clerk of Circuit Court and County Comptroller.” A sample of 25 change and petty cash funds were selected and an unannounced cash count was performed for each one. During the counts, it was noted that 10 funds (40% of the sample tested) were accessible to individuals other than the designated custodian (See Appendix A: Segregation of Duties). Management advised during the prior audit that to account for the department-level operational restrictions in various areas, compensating control procedures had been developed and submitted to the Finance Department for approval. Recommendation To ensure a proper segregation of duties, mandate compliance with the Accounting Policies and Procedures, Chapter 9.2 Business Center Receipt, Balance, and Deposit of Cash and Chapter 9.6 Cash Over and Short . Management Response Management accepts the level of risk associated with these findings, which we have assessed as minimal. The current accounting policies and procedures are too restrictive for operational design of certain departments to adhere to. Where these operational challenges in meeting policy requirements exist, we are working with the impacted departments to establish approved procedures which will be signed off on by the County Administrator and act as compensating controls.