Internal Audit Report - Quesnel District Offices

Ministry For Children And Families

Description

File No. 39328Internal Audit ReportQuesnel District OfficesMinistry for Children and FamiliesDistribution:Deputy Minister M. CorbeilAssistant Deputy Minister Management Services Division L. Foster Regional Operations V. DowieSenior Financial Officer G. NuttallManager, Program and Management M. Shinto AuditsRegional Operating Officer W. WestonInternal Audit BranchOffice of the Comptroller GeneralMinistry of Finance and Corporate RelationsApril 1998Table of ContentsSection Page No.Glossary............................................................................................ iExecutive Summary........................................................................ 1Background ..................................................................................... 4Purpose 4Scope ............................................................................................... 5Comments and Recommendations ................................................ 61.0 Resource and Support Payments.................................................61.1 Residential Resource Payments ...........................................61.2 Support Payments...............................................................102.0 Petty Cash ....................................................................................123.0 Imprest Cheques..........................................................................164.0 Purchase Authorizations................... ...

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• Publié par: Anfo
• Nombre de lectures: 40
• Langue: English

Extrait

Internal Audit Report Quesnel District Offices Ministry for Children and Families

Distribution: Deputy Minister Assistant Deputy Minister  Management Services Division Assistant Deputy Minister  Regional Operations Senior Financial Officer Manager, Program and Management  Audits Regional Operating Officer

Internal Audit Branch Office of the Comptroller General Ministry of Finance and Corporate Relations April 1998

File No. 39328

M. Corbeil L. Foste V. Dowie G. Nuttall M. Shinto W. Weston

Table of Contents Section

Page No.

Glossary............................................................................................ i Executive Summary ........................................................................ 1 Background ..................................................................................... 4 Purpose............................................................................................ 4 Scope ............................................................................................... 5 Comments and Recommendations ................................................ 6 1.0 Resource and Support Payments.................................................6 1.1 Residential Resource Payments ...........................................6 1.2 Support Payments...............................................................10 2.0 Petty Cash ....................................................................................12 3.0 Imprest Cheques..........................................................................16 4.0 Purchase Authorizations.............................................................17 5.0 Monitoring ................................................................................... 20

Glossary

CS

RAPS

RFO

SPMH

the ministry

VCA

Child Service

Resource and Payment System

Regional Financial Officer

Services to Persons with Mental Handicaps or Multiple Disabilities

Ministry for Children and Families

Voluntary Care Agreement

Internal Audit Report  Quesnel District Offices• i

Executive Summary

Overall Conclusion

Resource Payments

Support Payments

We have completed our audit of the payments originating from the Quesnel District Offices. An audit of financial controls was requested as a result of concerns raised in a program audit of the Quesnel District Offices. Overall, we found the controls over payments for residential services and support payments for Children in Care were poor and resulted in a number of invalid payments. In addition, the controls over the use of imprest cheques, purchase authorizations and petty cash were also poor. As a result, the Regional Operating Officer has insufficient assurance that the payments made were appropriate, properly authorized, properly coded and used for their intended purposes. However, we found that the residential and support payments to the Services to Persons with Mental Handicaps or Multiple Disabilities Program and the Special Needs Program were appropriate and no issues were identified with these payments. We cannot conclude whether the payments made to residential resources for the Children in Care Program were appropriate because of incomplete file documentation. In 15% of the placements we audited, we found that the home was overpaid. In another 27%, we were unable to determine whether the home was overpaid due to the lack of supporting information or file documentation. As a result, the Regional Operating Officer has little assurance that the payments for residential payments are accurate and are for services rendered. The Quesnel District Offices need to ensure that files are maintained according to policy. This should include updating the resources and clients tracking notes to document each placement, including start and finish dates, and completing a Change of Placement form on time. In addition, the District Supervisors should ensure that the files are updated regularly and change forms are prepared in a timely manner. We found that the controls surrounding the support payments for residential resources, families and clients for the Children in Care program need improvement to ensure they are within policy requirements and spending limits, are properly authorized and coded, and have appropriate back-up documents, including original receipts. For instance, of the payments sampled, 31% were overpaid and another 18% were not properly coded or authorized.

Internal Audit Report  Quesnel District Offices• 1

Petty Cash and Other Negotiable Instruments

Monitoring

The region should provide adequate financial training for the Social Workers and District Supervisors. In addition, the District Supervisor and Social Workers should ensure that the support payments made are appropriate. At the start of our audit, the Supervisor of Administrative Services had been back from a three month sick leave for only four days. Therefore many of our findings for Petty Cash and other negotiable instruments relate to the time period of her absence. The controls over petty cash and other negotiable instruments do not ensure that these funds are used for their intended purposes and are not overpaid. For instance, the petty cash fund was not in balance and 20% of the imprest cheques and 40% of the purchase authorizations had inappropriate spending authority applied. The Quesnel District Offices should perform reviews of petty cash expenditures, imprest cheques and purchase authorizations to ensure that the payees are ministry clients, the transactions are properly authorized and coded, and the payments are within limits set by policy. The issues identified in the report result largely from staff not following ministry policy. As a result, there is an increased risk of losses due to errors or misappropriations. Our audit detected a number of overpayments resulting from errors but nothing to indicate deliberate misappropriation. The region needs to monitor more closely to ensure expenditures are appropriate and comply with ministry policy. However, the region shares a Regional Financial Officer with another region. Staff in Quesnel indicate they have had very little contact with the Financial Officer because the Financial Officer is located so far from Quesnel. The region needs a financial officer for monitoring and training. We realize that the Quesnel Office was in turmoil due to staff leave and many new social workers substituting for short periods of time. This made it difficult for the controls to be followed and documentation to be complete. However, many of the issues raised in this report relate to the period prior to these changes. Details on these and other items are included in the Comments and Recommendations section of the report.

2• Internal Audit Report  Quesnel District Offices

We would like to thank management and staff of the Quesnel District Offices for their assistance and co-operation during the course of our audit.

David J. Fairbotham A/Executive Director Internal Audit Branch

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Background

Purpose

The Audit and Evaluation Team, Child Protection Division, of the Ministry for Children and Families performed a practice review on the Quesnel District Offices in October 1997. This review identified numerous deficiencies such as lack of client placement or service plans, lack of risk reduction plans, or a lack of a risk assessment. Therefore, in December 1997, a review of all the Child Service and Family Service files was undertaken by the region. In the process, the Cariboo Regional Operating Officer had concerns over the validity of payments to Foster Parents for children who were no longer placed in their care. Based on this, the Regional Operating Officer had concerns regarding financial expenditures originating within the Quesnel District Offices. The Regional Operating Officer requested an audit of all program spending in the offices, including: •   petty cash; •   imprest cheques; •   purchase authorizations; •   resource payments; and •   service payments. The Quesnel District Offices have three main program responsibilities, including: •   Children in Care Program Intake; •   Guardianship; •Services to Persons with Mental Handicaps or Multiple Disabilities.  

The purpose of our audit was to evaluate and report on the adequacy of financial controls within the Quesnel District Offices.

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Scope

The scope of our audit included the practices, systems and controls that support the offices financial function. We concentrated on fiscal years 1997/98 and 1996/97. Audit coverage included, but was not limited to examining:

• payments for resource services to determine whether all payments were for legitimate services received;

• control over petty cash to determine if this fund was appropriately used;

• to determine if the offices hadprocessing of Imprest Cheques adequate controls over these instruments and if the expenditures were appropriate; and

• other financial controls, including reconciliation procedures to determine the adequacy of controls in the offices over expenditures.

Our audit did not include an examination of the office's travel claims, leave system, budgetary controls or administrative functions.

Internal Audit Report  Quesnel District Offices• 5

Comments and Recommendations

1.0 Resource and Support Payments For both the Children in Care and Services to Persons with Mental Handicaps or Multiple Disabilities (SPMH) programs, we audited the: •   resource payments for residential services; and •   support payments to families, clients and caregivers.

1.1 Residential Resource Payments The audit attempted to determine if residential resources were paid only for services that were rendered. Overall, we found: •   the SPMH payments to caregivers for residential services were accurately paid and services were received; and •   for Children in Care placements could not bemany of the payments verified. As a result, it was difficult in many cases to determine whether the home was paid only for services rendered. Children in Care  Our audit of the resource payments for Children in Care identified   numerous problems. This has, in many cases, prevented us from concluding whether the Ministry for Children and Families (the ministry) can be assured that the payments were made only for services rendered. Overall, 15% of the homes were overpaid for placements. In addition, due to poor file documentation, we were unable to conclude whether or not the home was overpaid for another 27% of the placements. Resource Files  Of the 60 Children in Care placements we reviewed, 29 (50%) were not mentioned in the resource files, including the tracking notes or annual reviews. Most resource files did not contain Placement Service Plans (Form S2440), Monthly or Quarterly Home Reports or Change of Placement Forms (Form 1517). Most of the resource files reviewed did not contain Critical Incidence Reports. According to the ministry, Critical Incidence Reports are not required on all files. Ministry policy is not clear on where to file the Critical Incidence Reports. About 33% of the resource files have not been updated since 1996. Without this information, it was difficult to determine if the placement was ever in the homes.

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