Overview
The Southfield Redevelopment Authority (SRA) does not have an internal control plan and has not updated its policies and procedures manual since 2012. Also, the board of directors (BOD) did not instruct SRA management to create an internal control plan or update and maintain its policies and procedures manual. During a prior audit, the Office of the State Auditor found that SRA did not have an internal control plan and discussed this matter with the authority.
Without a documented internal control plan or an updated policies and procedures manual, SRA may be unable to sufficiently safeguard the organization or efficiently achieve its objectives.
Authoritative Guidance
Chapter 647 of the Acts of 1989 states, “Internal control systems for the various state agencies and departments of the commonwealth shall be developed in accordance with internal control guidelines established by the office of the comptroller.”
Section 12.01 of the Office of the Comptroller of the Commonwealth’s (CTR’s) Internal Control Guide states, “Managers and other staff in key roles should document internal control. . . . The documentation may appear in . . . administrative policies or operating manuals.”
Reasons for Issue
SRA management stated that the BOD was unaware that it needed to have an internal control plan or have an updated policies and procedures manual in place for SRA’s operations.
Recommendation
SRA should develop and maintain a documented internal control plan that includes policies and procedures for SRA operations.
Auditee’s Response
The Authority’s staff is currently working on a draft Internal Control Plan using the Office of the Comptroller of the Commonwealth’s Internal Control Guide. The Authority has individual policies for accounts payable and payroll, as well as a monthly and annual accounting checklist, however the Authority has not updated the policies and procedures manual that was adopted by its predecessor organization, the [South Shore Tri-Town Development Corporation]. The Authority will update the Policies and Procedures Manual to reflect our 2014 Enabling Legislation. Also, please note that the Authority has had an Antifraud Policy in effect since February of 2019.
Auditor’s Reply
SRA states that it is taking appropriate actions to address this finding.
| Date published: | December 20, 2024 |
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