Okaloosa County BOCC — January 8, 2013 — Final AG Report and Board Response - January 2013 — reading text

program were not utilized in conformity with the Grant requirements. The County will continue to review documentation as to other expenditures to determine whether the terms of the Grant were violated. As part of the County’s efforts, it has cancelled the remaining balance on all of the Debit Cards and has received a refund of these amounts. The County has been in touch with representatives of British Petroleum concerning handling of these funds and prospective use. Additionally, for those Debit Cards which are found to not be in compliance with the Grant or are otherwise questionable, the County will consult with Florida’s Coastal Northwest Communications Council, Inc. Finding No. 20: The County overcharged BP $27,063 in connection with medical support services provided, and County records did not adequately support the allowability of $385,185 in reimbursements received from BP. Recommendation: For future reimbursement agreements, the County should ensure that reimbursement requests are made pursuant to terms of the agreements, including submission of required supporting documentation. COUNTY RESPONSE: The County acknowledges the audit finding and recommendation. 47 JANUARY 2013 REPORT NO. 2013-085 The County has reviewed the charges to BP in connection with medical support services provided and acknowledges that there may have been some overcharges. Though the original Medical Services Agreement included a rate of $50.00 for an Advanced Life Support (ALS) SUV (non-transport) vehicle, representatives of BP specifically requested the availability of a fully staffed Advanced Life Support (ALS) Ambulance with transport capability. For those services that were provided by that enhanced vehicle, the standard rate of $100 was charged. However, the County has reviewed these charges and determined that there were some possible overcharges. These charges are being verified and where an overcharge is confirmed, the County will contact BP concerning these amounts and will refund those amounts where necessary. The County will require for future reimbursement agreements that requests for reimbursement be made in conformity with the agreements, including the submission of required supporting documentation. MOTOR VEHICLES Finding No. 21: The County had not established adequate controls over the use of fuel cards. Recommendation: The County should strengthen its vehicle usage procedures to include more reasonable fuel consumption parameters, the effective use of fuel card exception reports and user department reconciliations of fuel charges to gas receipts, and the retention of all gas receipts by user departments. COUNTY RESPONSE: The County agrees with the audit finding and recommendation. The County currently monitors fuel sales through a variety of documentation. The primary source of review is the electronic transaction data which establishes the purchaser, the fuel card number, the vehicle that was fueled, the fueling location, the amount purchased and the price. The County has already reviewed the parameters for all fuel cards and adjusted the parameters where appropriate. The County will continue to review its procedures and controls to provide assurance that adequate documentation is available. The County will also strengthen its vehicle usage procedures to include fuel consumption parameters and more effective use of its fuel card exception reports. Further, the County will review the viability of requiring user department reconciliation of fuel charges to gas receipts and the retention of all gas receipts by user departments. ACCOUNTING CONTROLS Finding No. 22: The County incorrectly classified and recorded certain expenditures in the accounting records, contrary to guidance provided by the Florida Department of Financial Services. Recommendation: The County should strengthen its procedures to ensure that expenditures are properly classified and recorded in accordance with the Manual. 48 JANUARY 2013 REPORT NO. 2013-085 COUNTY RESPONSE: The County agrees with the audit finding and recommendation. Initially, under the Constitution of the State of Florida, the Clerk of the Court and the BCC are independent constitutional offices. Though the Clerk, under Article V., section 16 of the Florida Constitution is empowered to serve as the “ex officio clerk of the board of county commissioners, auditor, recorder and custodian of all county funds,” the operation of his office is not subject to the direction of the BCC. The classification and recording of expenditures are within the purview of the Clerk’s functions. Therefore specific issues raised in regard to the function of the Clerk’s office either have been addressed or will be the subject of future coordination between the respective constitutional bodies. The County will work with the Clerk to strengthen its procedures to ensure that expenditures are properly classified and recorded in accordance with the Uniform Accounting System Manual for Florida Counties. To the extent that the misclassifications of expenditures in the general ledger are the result of errors by the advertising entities providing services to the County, efforts will be made to coordinate with these entities to assure that they are providing the proper coding. Finally, other corrective actions taken by the BCC will also aid the Clerk in assuring that there is adequate documentation to record disbursements in accordance with the Uniform Accounting System Manual for Florida Counties. CLERK’S RESPONSE: Historically, the Clerk recorded expenditures in accordance with the documentation provided and consistent with the Manual provided by the Florida Department of Financial Services. With the additional corrective action taken by the County in regard to the advertising contracted services, the Clerk will be able to more clearly identify the goods or services provided to make a better determination about the proper classification and maintain compliance with the Manual. ELECTRONIC FUNDS TRANSFERS Finding No. 23: The BCC had not adopted written policies and procedures, and the County had not established adequate controls, over the authorization and processing of electronic funds transfers. Recommendation: The BCC should develop written policies and procedures addressing EFTs as required by Section 668.006, Florida Statutes, including providing for an adequate separation of duties over access to County assets and the related accounting records, and documenting independent approvals before the funds are transferred. In addition, the CCC should revise its funds transfer agreement with the bank to address the deficiencies noted above and timely update its funds transfer agreement with the bank when changes in authorized personnel occur. COUNTY RESPONSE: The County agrees with the audit finding and recommendation. Initially, under the Constitution of the State of Florida, the Clerk of the Court and the BCC are independent constitutional offices. Though the Clerk, under Article V., section 16 of the Florida Constitution is empowered to serve as the “ex officio clerk of the board of county commissioners, auditor, recorder and custodian of all county funds,” the operation of his office is not subject to the direction of the BCC. The Clerk’s constitutional authority vests him with him the independent authority within these areas of responsibility. Therefore specific issues raised in regard to the function of the 49 JANUARY 2013 REPORT NO. 2013-085 Clerk’s office either have been addressed or will be the subject of future coordination between the respective constitutional bodies. The finding made by the Auditor General cites the provisions of Section 668.006, Florida Statutes, which requires the head of each agency to implement control processes and procedures to ensure adequate integrity, security, confidentiality and auditability of business transactions conducted using electronic commerce. Though the Finding references that the County utilized electronic fund transfers, those transfers were through the Clerk’s Office and therefore the responsibility to implement controls rests with the Clerk. However, the County as part of its corrective action plan will coordinate with the Clerk to develop policies and procedures for the use of electronic fund transfers. CLERK’S RESPONSE: The Clerk will review Section 668.006, Florida Statutes in order to be compliant. The Clerk will document policies and procedures for Electronic Funds Transfer as a part of the Clerk’s Accounting Policies and Procedures Manual. The Clerk has modified the bank agreement and is currently investigating, along with the County Bank provider, any additional controls for the Electronic Funds process. INFORMATION TECHNOLOGY CONTROLS Finding No. 24: The County had not established adequate controls over employee access privileges to data and information technology resources. Recommendation: The County should strengthen its procedures to include the periodic review of access privileges granted to employees and timely remove or modify unnecessary or incompatible access privileges detected. COUNTY RESPONSE: The County agrees with the audit finding and recommendation. Initially, under the Constitution of the State of Florida, the Clerk of the Court and the BCC are independent constitutional offices. Though the Clerk, under Article V., section 16 of the Florida Constitution is empowered to serve as the “ex officio clerk of the board of county commissioners, auditor, recorder and custodian of all county funds,” the operation of his office is not subject to the direction of the BCC. The Clerk’s constitutional authority vests him with the independent authority within these areas of responsibility. Therefore specific issues raised in regard to the function of the Clerk’s office either have been addressed or will be the subject of future coordination between the respective constitutional bodies. However, the County as part of its corrective action plan will coordinate with the Clerk to develop policies and procedures for the periodic review of access privileges. CLERK’S RESPONSE: The Clerk has recently reviewed the controls in place for all the users of the financial software system and updated those controls, where possible and where needed. The Clerk will document policies and procedures in place for processing of transactions, especially manual journal entry processing, in order to update them and provide additional controls, as necessary. Periodic reviews of access privileges will be conducted on an ongoing basis to ensure good internal control and proper employee access. 50 JANUARY 2013 REPORT NO. 2013-085 PUBLIC RECORDS Finding No. 25: The County did not record minutes of a TDC and TDC subcommittee meeting, contrary to law. In addition, the minutes of the remaining meetings were not signed or otherwise designated to indicate the minutes were the official minutes approved by the TDC or TDC subcommittees. Recommendation: The County should continue to strengthen its procedures for maintaining official minutes of the TDC and TDC subcommittees by recording minutes for all meetings and requiring that the final approved minutes made available for public inspection be