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G.R. O.W., Inc. <br /> Schedule of Findings and Questioned Costs (continued) <br /> 02-4 Allowable Costs / Cash Disbursements <br /> Reportable Condition: A random sample of 40 disbursements from a total of <br /> approximately 870 for the period was selected. Our tests disclosed that 100% of the <br /> items selected showed no indication that the supporting documents were mathematically <br /> accurate or indicated general ledger posting source. In addition 30% of the items <br /> selected did not have a supporting check request, authorizing payment for the <br /> disbursement. This is deemed to be a material weakness <br /> Criteria: Only invoices and supporting documents , which have been properly approved <br /> and tested for accuracy should be submitted for payment. <br /> Effect: Proper control and oversight of the cash disbursements functions was <br /> compromised. <br /> Recommendation: Appropriate written policies and procedures should be established to <br /> ensure proper internal controls over cash disbursement procedures . All invoice along <br /> with the accompanying supporting documents , should be tested for accuracy, properly <br /> identified as to general ledger posting, and properly approved for payment and cancelled. <br /> Management Response: Procedures have been implemented to ensure that invoice <br /> amounts are verified mathematically prior to approving payment. Invoices are now being <br /> stamped paid, dated, and the check number is recorded. A check request is prepared and <br /> attached to the invoice. The director, currently approves invoices , check requests , and <br /> signs checks . However, a policy will be developed to include an additional review and <br /> approval of all invoices and disbursements by a member of the Board prior to releasing <br /> payments . There will also be a general ledger account number with the balance recorded <br /> on all invoices . <br /> - 18 - <br />