Leslie Knope, Auditor for Playground County, signs the claims twice a month before they are presented to the Commissioners for approval. Leslie’s accounts payable clerk, April, gathers all the information and prints out a claim document for Leslie to sign every two weeks. Once Leslie has signed the claim document it is presented at the next Commissioners meeting for approval. Once the Commissioners approve payment of the claims the Auditor office initiates the payment process. This process has been done the same way for 10 years with no problems. It is that time of year when the State Board of Accounts sends in their field examiners to perform their annual audit of the financial statements. While performing the audit Susie, an experienced field examiner performs a test of disbursements by pulling a sample of claims paid throughout the audit period. One of the claims chosen for audit is for the county credit card. The county has only had the credit card for a few years now and has adopted a credit card policy as they were advised per the prior audit. As Susie reviews the claim she realizes that itemized receipts are not always submitted by the user. Susie brings the issue to Leslie asking for supporting documentation. Leslie takes a look at the charges and determines that the needed itemized receipts were all from the Sheriff’s office and makes a call to their head bookkeeper, Ron Swanson. Ron had maintained all the itemized receipts but had never turned them in. He brings them over to Susie, the field examiner, for audit. Susie reviews the itemized receipts and determined that the Sheriff’s office have been purchasing personal items with the credit card and having the county pay for them. The personal items included groceries, gas (in which a travel claim was submitted as well), and alcohol purchases. Susie shows the Leslie the itemized claims and the finding that will be included in the report. State Board of Accounts Special Investigations have also been notified.

REQUIREMENT

Was there an internal control issue?

What should have been happening?

Should the Auditor have had a finding?