“A substantial portion of the stale-dated checks was scholarship-related; however, the $1,179,060 was recorded to a miscellaneous adjustment account in the general fund. Further, total checks of $372,570 held at year-end related to checks returned by the CNMI Scholarship and SHEFA office for cancellation. However, the Division of Treasury has not voided the checks,” th OPA report stated.
Additionally, checks in the amount of $191,741 were cleared in the bank but were not recorded in the general ledger.
During the same period, OPA found out that 629 rebate checks with a total value of $121,387 were returned by the post office because their recipients could not be located.
“The checks have dates ranging from Oct. 4, 2007 through August 29, 2008. The Division of Treasury does not appear to have monitored these returned checks as such are reported as outstanding checks in the Sept. 30, 2008 reconciliation,” OPA said.
OPA said the division’s lack of policies and procedures to ensure that all manual checks are posted to the general ledger may provide opportunity for fraudulent activities and suggested that adequate monitoring should be put in place.
“The effect of the above condition is the misstatement of cash, payables and expenditures and numerous reconciling items in the bank reconciliation. Further, the above condition may provide opportunity for fraudulent activities,” it said.
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