THE lack of standard operating procedures indicates a lack of accountability and oversight in the Department of Finance’s daily collections, the Office of the Public Auditor said.
In a report dated Aug. 4, 2023, OPA said it conducted an audit on DOF’s collection points on Saipan from Dec. 14-16, 2022 to determine if daily collections were properly accounted for.
Finance did not have an SOP at its collection points on island, OPA said. This resulted in untimely reconciliation and remittance of daily collections to the Treasury and improperly secured daily collections and manual official cash receipts at five collection points, OPA said.
It also noted the lack of segregation of duties at one collection point; cash overages and shortages at five collection points; and inconsistent change funds provided to all collection points.
The DOF’s collection points that OPA audited included the Division of Customs at the Francisco C. Ada/Saipan International Airport, the Port of Saipan, the U.S. Postal Service, the Division of Revenue and Taxation, the Division of Treasury, the Bureau of Environmental and Coastal Quality, the CNMI Scholarship Office, the Commonwealth Law Revision Commission, the Commonwealth Office of Transit Authority, the Nutrition Assistance Program, the Division of Agriculture, the Division of Parks and Recreation, the Bureau of Motor Vehicles, the Department of Public Works-Solid Waste Management at the Lower Base transfer station and Marpi Landfill, and the Joeten-Kiyu Public Library.
OPA said Finance should develop and implement a uniform SOP for accountability of collections at all Finance-sanctioned collection points, and ensure strict adherence.
The SOP should have adequate procedures to ensure that reconciliation of daily collections is performed at the end of each business day; collections are deposited timely; collection duties are properly segregated; internal controls are established to ensure that all unremitted collections to the Treasury are properly secured; and the need for change fund at all collection points is reassessed, OPA said.
In her response, Finance Secretary Tracy B. Norita said the Treasury has begun efforts to finalize and disseminate an official cash handling SOP, along with other agency-specific SOPs being compiled for all Finance-sanctioned collection points on Saipan.
She said going forward, all collection points are on board with a uniform method of daily reconciliation, as well as daily remittance of collections to the Treasury.
As to improperly secured daily collections, Norita said all collection points have been briefed regarding the safekeeping of used and unused Manual Official Cash Receipts or MOCRs which will be included in the SOP that will be distributed to collection points. These stations, she said, have been advised to procure a safe box or vault for efficient safekeeping of payments and MOCRs.
Regarding the lack of segregation of duties, the Finance secretary said the SOP will include an auditing section that will ensure segregation of duties for all individuals involved in the cash handling at a collection point. She said all collection points have been advised to submit official documentation to determine authorized personnel to be involved in cash handling, as well as reconciliation and access to vaults, safe boxes, and keys/codes within their stations.
Norita said the SOP will also include policies and procedures regarding overages and shortages. This will allow all authorized personnel involved in cash handling to acknowledge efficient practices when dealing with situations involving overages and shortages and proper documents.
As for the inconsistent provision of change fund, she said the Treasury has identified all collections points in need of a change fund, and has initiated the process of providing these collections points with a proper change fund.
She said departments have also been instructed to issue an official memorandum to request a change fund for their respective collection points, and indicate a justified amount.
