Description
Problems with petty cash go unresolved
Executive Summary
Why The Controller’s Office Conducted The Examination
Pursuant to the requirements of Section 6-400 (c) of the Philadelphia Home Rule Charter, we examined the financial affairs of Philadelphia’s city agencies as part of our audit of the City of Philadelphia’s basic financial statements. The focus of our examination was to determine if management of each agency had suitably designed and placed in operation internal controls to ensure accurate financial information and compliance with any laws and regulations related to revenue and expenditure activities.
What The Controller’s Office Found
The Controller’s Office again noted widespread deficiencies involving internal controls over payroll and other expenditure activities that the Office of the Finance Director needs to address with agency heads (see Appendix I). Highlights of the deficiencies include:
- American Express travel reimbursement vouchers did not indicate evidence of approval by the Office of Finance for either of the two monthly vouchers we tested totaling $56,000. In addition, there were nineteen instances where forms were signed by a departmental employee not authorized to approve expenditures, and eighteen instances where the reason for the employee travel was missing or unclear.
- On-line payroll time records were not always reviewed to ensure separated employees are removed from active status on the on-line payroll system. Four former employees continued to be paid after their termination dates and were overpaid a combined total of $5,500 from the Division of Housing and Community Development, the Police Department, and the Office of Human Resources.
- The city’s sick leave policy was still not enforced in 33% of city agencies. Most notably in City Council, where its employees were not subject to the same sick abuse sanctions as their civil service counterparts. Five employees used in excess of twenty-two undocumented sick days, totaling over $36,000 in paid sick leave. In addition, three Law Department employees used in excess of twenty undocumented sick days, totaling over $10,000 in paid sick leave.
- Almost 31% of city agencies did not deposit long outstanding checks into the City of Philadelphia’s Unclaimed Monies Fund, which increases the risk that unclaimed property would not be forwarded to the state in violation of the Commonwealth of Pennsylvania’s Unclaimed Property Law.
- Noteworthy of mentioning is one city agency, the Records Department, which took corrective action on its only prior year condition, and implemented our recommendation.
What The Controller’s Office Recommends
The Controller’s Office has developed a number of recommendations to address these findings. The recommendations can be found in the body of the report.