Audit Division
Audit Summary
Results in Brief
|
Although the Real Estate Division has made an effort to improve its financial controls since our last audit, weaknesses persist. For instance, thousands of dollars in fines are assessed against licensees; however, the Division does not have an effective process to account for and collect these fines. As a result, the Division collected about one-third of the amounts due. In addition, deposits are not verified against amounts collected, and money is not always deposited timely. Similar weaknesses in cash management controls contributed to an embezzlement discovered during our prior audit. Therefore, additional controls are needed to improve the Division’s financial management practices.
Principal Findings
|
·
The Division’s
accounts receivable reports are not complete or accurate. During fiscal year 2000, accounts receivable
totaling $35,000 were not recorded in the Division’s reports. In addition, the reports were not
mathematically correct and did not always include the balances due. Unreliable
accounts receivable information hinders the Division’s recovery of moneys owed.
·
The Division does not
have adequate procedures to collect past-due accounts. Collection procedures are limited to a
letter requesting payment. No other
collection techniques are employed. As
a result, the Division collected only $30,000 out of the $100,000 due in fiscal
year 2000.
·
The Division’s cash
handling practices should be strengthened.
No one independent of the deposit process verifies the amounts deposited
with the amounts collected. This
weakness existed when we conducted our prior audit, contributing to the
embezzlement of $21,000.
·
The Division charges
$100 to prospective licensees for taking the Real Estate or Appraiser
examinations. However, this fee has not
been established in regulation. As a
result, those individuals affected did not have the opportunity to comment on
its propriety and the fee was not subject to legal review.
to Audit
Recommendations
Recommendation
Number Accepted Rejected
1 Develop policies and procedures
to help ensure all receivables are
properly accounted
for. ___X____ _______
2 Enforce
the collection of accounts receivable through the use of available
collection
techniques. ___X____ _______
3 Develop policies and procedures
that help ensure uncollectible
accounts
receivable are properly written off. ___X____ _______
4 Segregate
key duties in the collection process. ___X____ _______
5 Ensure
deposits are verified with cash receipts by staff independent of
the deposit
process. ___X____ _______
6 Develop
procedures to ensure cash receipts are deposited no later than
Thursday of each
week, and by the next working day if $10,000 or more
accumulates. ___X____ _______
7 Establish
examination fees in regulations. ___X____ _______
___7____ ___0___