Audit of Purchasing Card Program, July 2018

15 |  A u d i t o f t h e P u r c h a s i n g C a r d P r o g r a m  J u l y 2 0 1 8 7. Timely Notification of Changes in Status of Employment for P‐Cardholders Observation  The P‐Card Manual, chapter 10.1, requires the Department Director to immediately notify  Human Resources of any changes in status of employment, regarding employees that have  been issued a P‐Card. Human Resources is then to notify the P‐Card Administrator. Changes in  status of employment include resignation, termination, suspension, and any other status  changes outlined in the Personnel Policies that extend past five business days. An  Acknowledgement of Returned or Suspended Purchasing Card  form must be completed by the  Department Director or Designee and returned to the P‐Card Administrator. The P‐Card  Administrator will deactivate or suspend the P‐Card within 24 hours of notification of status  change.  In order to determine if notification processes and deactivation of P‐Cards is occurring timely  the auditor focused testing on terminated employees and performed two separate tests. The  first test was to match, by last name, all terminated employees during the audit period to the  entire list of Cardholders within the application and verify that management immediately  notified the P‐Card Administrator of the employment status change. The second test was to  obtain a list of all deactivated P‐Cards during the audit period and review each corresponding  Acknowledgement of Returned or Suspended Purchasing Card  form to verify that the P‐Card  was deactivated or suspended within 24 hours of notification of employee termination.  A total of 21 employees that had been issued a P‐Card were terminated between the dates of  October 1, 2016 and September 30, 2017. The auditor reviewed the 21 P‐Cards in order to  determine if notification by management and deactivation of the P‐Cards occurred timely.  During review, it was noted that three of the Acknowledgement of Returned or Suspended  Purchasing Card  forms indicated that the P‐Card Administrator was not notified by the  Department Director or Designee for approximately 7 to 10 weeks after the Cardholder's  employment with the County was terminated. The auditor did not observe any transactions on  these P‐Cards after the employee’s date of termination.  Recommendation To ensure compliance with the P‐Card Manual, chapter 10.1, the Procurement Official should  reiterate to Department Directors their ongoing responsibility to immediately notify Human  Resources when a cardholder’s employment status changes that extend past five business days.  Mandate that Department Directors comply with the requirement to complete an  Acknowledgement of Returned or Suspended Purchasing Card  form upon an employee’s  separation and provide the completed form to the P‐Card Administrator.