The North Carolina State Auditor has released its findings in the fiscal control audit of the Pamlico County Clerk of Superior Court.
According to the Auditor's office, "there were no special circumstances that caused us to conduct the audit, but rather it was performed as part of our effort to periodically examine and report on the financial practices of state agencies and institutions."
The Auditor's office reports they discovered "deficiencies in segregation of duties." The report states "the Clerk’s office has given staff access rights to information systems and assigned job duties that are incompatible with adequate segregation of duties and not in compliance with the Clerk of Superior Court Financial Policies and Procedures Manual. As a result, errors, fraud, or misappropriations could occur and not be detected in a timely manner."
The audit states "the bookkeeper has access rights within the Financial Management System that allows her to enter cash receipts and void cash receipts. She also has access that allows her to disburse funds and create and post journal entries. The bookkeeper is solely responsible for the determination of the investment of funds, the investment fee calculation, the opening and deposit of investments with the bank, the closing and withdrawal of funds from the bank, and the posting of all associated journal entries for the investment of trust accounts. She is also responsible for the preparation of the pooled investment fund bank account reconciliation. There are no review procedures performed over any of these functions. In the Clerk of Superior Court Financial Policies and Procedures Manual, guidelines are established to maintain segregation of duties. Adequate segregation of duties involves assigning responsibilities for transactions such that the duties of one employee automatically provide a cross-check on the work of other employees."
The Auditor's office recommended the clerk should follow the manual in assigning job duties and giving access to the information systems.
The Clerk's office has already responded and is making the appropriate changes.
"We have removed our bookkeeper’s access to cash receipting," read the Clerk's response in the audit release. "To strengthen internal controls with regards to accounting for investments, the Clerk and/or our Assistant Clerk will take an active role in all transactions related to the invested funds held by our office by, reviewing the monthly investment analysis, reviewing and approving fee calculations and payment authorizations made to create the investment and by personally opening and closing the investments myself."
The clerk oversees the court's cash, investments and trusts. The balance in those three areas was approximately $1.28 million at the time of the audit.
Click the document link above to read the entire audit.