Sharing of Audit Experience II

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Sharing of Audit Experience (II)
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Common Audit Findings

• Inadequate payment and revenue control
• Loose budgetary control
• Non-compliance with approval requirements
• Trading activities
• Fees Collection
• Insufficient assets control
• Incomplete/inaccurate leave records

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Payment Control

• Why payment control?
• Ensure proper use of schools resources
• Avoid unauthorized/duplicate payments
• Some general guidelines
• Fully supported
• Properly documented
• Properly authorised
• Segregation of duties

4
Payment Control

• Examples of practices to avoid unauthorized /
  duplicate payments
• Support payments with original invoices
• Stamp Paid on all paid vouchers and invoices

• No pre-signing of cheques

(SAG para. 6.5.4 ,6.5.6)
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?
6
Grant Ambit

• Expenditure of schools should be charged to
  appropriate grant to facilitate
• Expenditure monitoring
• Future budget construction

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Grant Ambit
?
CEG
CFEG
CFEG
SCG
Gov/ School Funds
From staffs pocket
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Grant Ambit

• Items not to be paid from Government Funds
• Utility and other deposits
• Electricity and maintenance charges of
  air-conditioners funded by School Funds
• Penalty charges, fines and overdraft interest

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OEBG Expenditure Control

• Prepare expenditure report to monitor the actual
  use of resources against the OEBG Budget
• Report periodically to SMC
• Seek delegation of authority from SMC for making
  changes to the budget up to a certain financial
  limit.

(EMBC 27/2000)
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Revenue Control

• Why revenue control?
• Ensure all incomes received are properly
  accounted for
• Minimize risk of cash loss

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Revenue Control

• Some general guidelines
• Avoid keeping large sums of cash
• Issue pre-numbered official receipts

12

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Revenue Control

• Some general guidelines (continue)
• Avoid pre-signing of receipts
• Review internal control for safe custody of cash

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Revenue Control

• In the context of schools
• Deposit collections from students into schools
  bank account instantly
• Record cash collections in Daily Collection
  Summary for ascertaining cash position and
  reconciliation purpose
• Stamp Cancelled on obsolete official receipts

(SAG para. 6.5.3)
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Sample
Record all cash collections
3/1/04
School Picnic
0001-0020
600
5/1/04
Joe
600
5/1/04
Air-condit Fee
0021-0040
3,000
5/1/04
Sam
3,000
Air-cond Fee
Sam
5/1/04
SchoolFee
0041-0050
5,000
5/1/04
Sam
5,000
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Investment of Surplus Funds

• Surplus funds not immediately required for use
  time deposits or savings accounts instead of
  current account
• (EMBC 2/2003)

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Collection of Fees for Specific Purpose

• Charges for non-standard items
• Within approved limit with parents consent to
  improve transparency
• Above approved limit- with REOs approval

(EMBC 46/99)
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Trading Activities

• REOs approval required for
• all trading activities
• subsequent changes to approved trading operations

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Trading Activities

• Points to note
• Tuckshop operation - rates and government rent
  borne by tuckshop operator
• Vending machines Electricity charges (paid from
  Government Funds) reimbursed by vending machine
  suppliers to be credited to School and Class
  Grant Account

(EMBC 13/2003)
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Control of Assets

• Some control measures to safeguard schools
  assets
• Update Fixed Assets Registers (FAR)
• Record particulars of fixed assets in FAR
• Seek School Heads approval for write-off of
  fixed assets and other valuables
• Pass the report on write-off to SMC for
  information
• Conduct physical checking

(SAG para. 6.5.5)
21
Appendix 7 SAG,Section 6
1 2
40,000
HP Laserjet 1100 Printer S/N abc324 Aficio 450
Photocopier S/N gs2347
23/3/98 12/9/02
2,100
One One
Computer Room General Office
31/8/02 Damage beyond repair
Kevin


Write-off to be endorsed by Supervisor/ School
Heads
Record details of fixed assets, e.g. brand name,
model no., serial no.,etc
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Leave records

• Proper management of leave matters
• Keep up-to-date leave records for all staff
• Obtain appropriate approval for granting of leave
• Furnish returns periodically

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Leave records

• Points to note
• Keep up-to-date leave records with cumulative
  leave balances
• Prepare written leave application form to support
  application and granting of leave
• Seek REOs approval for no-pay leave of teaching
  staff
• Compile half-yearly summary of leave of
  non-teaching staff for Supervisors endorsement

(EMBC 37/2000 18/2002)
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Appendix D (EMBC 18/2002)