Overview
SDE did not immediately report lost inmate funds totaling $624 to the Office of the State Auditor (OSA) as required by Chapter 647 of the Acts of 1989. Because SDE did not immediately report the loss of these funds, OSA could not review the matter and determine the circumstances and potential internal control weakness that contributed to, or caused, the loss. In addition, OSA was not given the opportunity to make recommendations to SDE to reduce the likelihood of future losses.
While booking an inmate into the jail, SDE Intake Unit personnel took possession of the inmate’s funds and recorded the amount in SDE’s records. However, the actual funds were never processed to the inmate’s account and could not subsequently be located within the Intake Unit. SDE’s Internal Affairs personnel conducted an investigation and the funds were reimbursed to the inmate on September 27, 2016. SDE filed the required report with OSA on August 15, 2017, after the audit team brought the matter to the attention of SDE officials.
Authoritative Guidance
Section F of Chapter 647 of the Acts of 1989 states,
All unaccounted for variances, losses, shortages or thefts of funds or property shall be immediately reported to the state auditor’s office, who shall review the matter to determine the amount involved which shall be reported to appropriate management and law enforcement officials.
Reasons for Noncompliance
SDE Internal Affairs personnel told us that they were unaware that the theft or loss should have been reported to OSA. SDE did not have a policy communicated to all employees that established procedures for reporting all shortages or thefts of funds or property to OSA.
Recommendations
- SDE should establish a policy detailing a process for filing a timely report with OSA for all shortages or thefts of funds or property.
- SDE should ensure that all personnel are properly trained and aware of the Chapter 647 reporting requirement for all shortages or thefts of funds or property.
Auditee's Response
While SDE completed a well-documented Internal Affairs investigation into this referenced loss, SDE did indeed neglect to report this isolated incident. Upon recognizing this oversight, SDE then filed the Chapter 647 report with the Office of the State Auditor. To prevent a future failure to report, SDE’s Fiscal Division will establish a Policy and Procedure within its Internal Control Plan to ensure that the Office of State Auditor (OSA) is advised in a timely manner of any and all shortages or theft of funds and property. Additionally, SDE will coordinate with the Department’s Training and Staff Development Division to ensure that all appropriate SDE personnel receive training in OSA’s Chapter 647 reporting requirements.
| Date published: | August 27, 2018 |
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