Friday, February 22, 2008

Audit reveals deficiencies

A newly released audit of financial statements from three years ago revealed significant deficiencies in a number of Luzerne County row offices, according to a Feb. 12 letter sent to county commissioners.

The findings of 2005 financial records ranged from old bookkeeping systems and lack of duties among accounting and clerical staff to inadequate cash control with the Sheriff’s office and missing funds from the Recorder of Deeds.

Sugarloaf Township-based Jones Kohanski & Co. performed the audit and listed the following:

Bookkeeping system: A double-entry bookkeeping system was never established in some row offices of the county. In 2005, most of the offices became computerized. There are some still kept in written ledgers that don’t include “a self-balancing, double-entry bookkeeping system.”

Segregation of duties: There is a lack of segregation of duties in each row offices because of the size of accounting and clerical staff. The audit recommended emphasizing proper segregation of duties, including an independent individual for the cash and accounting functions.

Reconciliation of prothonotary poundage accounts: There is a malfunction in the computer software used to record transactions in the Prothontary’s Office because the system does not generate consistent reports and “increases the risk of fraud or errors occurring without being detected in a timely manner.”

Sheriff’s office cash controls: Internal controls over cash in the county sheriff’s office are “not adequately designed to prevent and detect defalcations (theft or misuse of funds) or errors.” Cash receipts were kept in an unlocked cabinet and not always deposited on a daily basis.

Recorder of Deeds office cash control: In 2005, funds were missing from the Recorder of Deeds office. Recommendations ranged from improving file storage and recordkeeping to reviewing cash processing procedures.

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