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OFFICE OF AUDITOR OF STATE STATE OF IOWA - page 29 / 39

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Villisca Municipal Power Plant

Schedule of Findings

Year ended December 31, 2003

(B) Imprest Cash – Petty cash funds on hand at the Power Plant did not appear to be maintained on an imprest basis or included in the appropriate fund balance. Receipts were not retained for all purchases.

Recommendation – Petty cash funds should be maintained on an imprest basis and the cash on hand should be included in the appropriate fund balance. To provide additional control over the funds, receipts should be retained for all petty cash purchases. Imprest systems improve the accountability for cash and enhance reconciliation of receipts and deposits.

Response – We will have the Secretary maintain a journal with a starting balance, money

out, by whom and check to the bank,

purpose. When

cash

then include the

date,

needs reimbursed the Secretary will write a amount and new balance in the journal. We

will maintain cash amount report.

receipts for all cash purchases and have the with the journal monthly. This will then be

Treasurer reconcile the petty reported to the Board in her

Conclusion – Response accepted.

(C) Receipts – Prenumbered receipts were not issued for all collections.

Recommendation – Prenumbered receipts should be issued at the time of collection for all moneys to provide additional control over the proper collection and recording.

Response – Receipts will need to be pre-numbered. The Secretary will also maintain a pre- numbered receipt book for any miscellaneous hand written receipts and receipts will be issued at the time of collections of monies.

Conclusion – Response accepted.

(D)

Disbursements – Invoices were not marked paid or cancelled to help prevent possible

duplicate payment. Invoices or other

the

vouchers.

In

addition,

evidence

supporting documents were not always attached to of review by the Board was not documented and

certain

invoices

include

specific

were not on the paid bill listing published. Also, travel documentation regarding destination, purpose and dates

claims did

not

of travel.

The

Board has not established meal or lodging reimbursement limits. maintains a signature stamp containing the signature of the Board Power Plant office which was not adequately secured during the year.

The Power Plant Chairman at the

Recommendation – All invoices and supporting documentation should be cancelled to help prevent possible duplicate payment and should be attached to the vouchers. All invoices should be approved by the Board and a complete and accurate listing of bills should be included in the minutes. The Board should determine specific requirements for travel claims to provide reasonable reimbursement limits and documentation for the request of reimbursement.

To strengthen internal control, each check should be prepared and signed by one person and then the supporting vouchers and invoices should be made available along with the check to the second or independent person for review and countersignature. If a signature stamp will continue to be maintained, it should be properly safeguarded.

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