Certain cash-handling procedures in the Department of Vehicle and Drivers’ Licensing raised red flags for internal audit staff who reviewed the department in October 2016.
In one of the procedures, the audit staff described a “lack of accountability.”
The procedure, known as the “mid-morning” cash transfer, raised red flags with the Internal Audit Service.
“We noted that licensing officers would give large bank notes from their cash drawers to the supervisor and, at a later point in the day, the supervisor would provide smaller denominations [i.e., change] to the licensing officers,” the report stated.
When auditors questioned this practice, they were told it was done to avoid going to the bank to collect the smaller notes needed to provide change to customers.
Normally, change of custody forms for the cash held at the start and end of daily operations were filled out, but no similar documentation was used for the “mid-morning” cash transfers.
This internal control for the mid-morning transfer was “inadvertently overlooked,” auditors were informed.
“We are concerned that in the event of a discrepancy, it will prove difficult to assign responsibility for the error and/or financial losses,” the Internal Audit Service reported.
The DVDL responded that a senior management post, filled in January 2017, would assist with further documenting cash handling procedures and would “make corrections” as necessary.
Internal auditors also found some concerns regarding how cash was stored in the safe at the department’s Crewe Road offices in George Town.
“The transfer of funds in and out of the safe is not documented,” the report noted.
The safe, which stored the department’s revenues overnight, was routinely being accessed by one department employee who had access to both the safe combination and keys needed to unlock it. The combination code was never changed, auditors found.
“We are concerned that single entry access to the safe and the lack of documentation of movement of funds greatly increases risk of theft/misappropriation of assets,” the report stated.
The DVDL management agreed to make safe security changes as recommended by auditors and said they would do so by Oct. 31, 2016.