United States Capitol Police:

1999 Financial Audit Highlights Need to Address Internal Control Weaknesses

AIMD-00-153: Published: May 15, 2000. Publicly Released: May 15, 2000.

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Pursuant to a congressional request, GAO reviewed the United States Capitol Police's (USCP) fiscal year (FY) 1999 financial statement audit, focusing on USCP's: (1) effectiveness of the safeguarding, compliance, and financial reporting controls; (2) compliance with selected provisions of laws and regulations; (3) receipt and use of FY 1999 appropriated funds as reflected in a statement of receipts and disbursements prepared on a modified cash basis; and (4) actions to respond to Booz-Allen & Hamilton's recommendations. GAO contracted with PricewaterhouseCoopers (PwC) to conduct the audit.

GAO noted that: (1) USCP's internal control was not effective in ensuring that: (a) assets are safeguarded against loss or misappropriation; (b) transactions are executed in accordance with management's authority and with laws and regulations; and (c) there are no material misstatements in the financial reports; (2) on three occasions involving its salaries appropriations, the USCP violated the Anti-Deficiency Act, which prohibits an officer or employee of the United States from, among other things, making an expenditure from an appropriation that exceeds the amount available in the appropriation; (3) the USCP's combining statement of receipts and disbursements for FY 1999, prepared for purposes of this audit, presents fairly the receipts and disbursements of FY 1999 appropriated funds on a modified cash basis, which is another comprehensive basis of accounting; (4) in addition, with respect to USCP action on the Booz-Allen & Hamilton 1999 recommendations, PwC obtained from the USCP its response to the recommendations and the status of efforts needed to address them; and (5) while the USCP is in the process of making improvements in response to the previous recommendations, substantial work remains.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP prepared a plan based on its identification of both existing and additional financial management resources and capabilities needed to meet its financial management requirements.

    Recommendation: USCP should develop a financial management improvement plan which identifies USCP's existing financial management resources and capabilities and documents how they can be applied to meeting specific financial management requirements, and identifies those requirements that cannot be met within existing financial management resources and capabilities and documents the additional resources and capabilities needed to enable the USCP to consistently meet these requirements.

    Agency Affected: United States Capitol Police

  2. Status: Closed - Not Implemented

    Comments: Since this 2000 recommendation, GAO efforts to monitor the status of this recommendation have noted that USCP needed to continue work to develop and implement sufficient financial management policies and procedures and that responsible staff are adequately trained (GAO-08-1000T, July, 16, 2008). Subsequently, an internal USCP Board-sponsored project team review noted, in December 2010, that, while the USCP had initiated a policy modernization initiative, the USCP had several financial management directives and standard operating procedures which were not consistent with the Policy Modernization Initiative and the review recommended that the USCP establish a plan (with specific milestones) to implement and institutionalize financial management policies and procedures needed to address identified gaps. According to USCP officials, the Department has taken some action to address the identified gaps in policies and procedures but additional action remains. Given the longstanding open status of this recommendation and USCP's continuing efforts to improve its financial management policies and procedures, this recommendation is closed as unimplemented.

    Recommendation: The USCP needs to develop and implement policies and procedures covering all matters which impact the financial performance of the USCP. Steps should be taken to ensure that the developed policies and procedures are implemented consistently throughout the USCP, and that training is provided to all employees to ensure that they are aware of the stated policies.

    Agency Affected: United States Capitol Police

  3. Status: Closed - Implemented

    Comments: The USCP acquired access to an automated financial management system with an automated procurement module that generates purchase orders, processes procurement transactions, and records and reconciles vendor payments, thus improving the efficiency and effectiveness of its procurement activities and the timeliness of vendor payments.

    Recommendation: The USCP needs to adopt an efficient and effective way to automate procurement of goods and services. The system used to automate the procurement of goods and services should be capable of interfacing with the FFS.

    Agency Affected: United States Capitol Police

  4. Status: Closed - Implemented

    Comments: The USCP implemented specific procedures to ensure that vendor invoices and expense reports be submitted more promptly, and that payments are in accordance with the Prompt Payment Act. In addition, the USCP and the Capitol Police Board established invoice approval thresholds that permit the Chief Administrative Officer and Financial Management Director to approve most vendor payments.

    Recommendation: The USCP should implement strict enforcement standardss to ensure that divisions and employees submit vendor invoices/expense reports in a timely manner. Furthermore, USCP should work with the appropriate oversight Committee to establish approval thresholds for expense disbursements.

    Agency Affected: United States Capitol Police

  5. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP established and implemented procedures for entering accurate, complete, and timely financial data into the new system, as part of its implementation of its integrated financial management system capability.

    Recommendation: The USCP should ensure that procedures are developed and implemented which will enable the USCP to enter accurate, complete, and timely financial data into FFS, and to reconcile and monitor all financial operations on an on-going basis.

    Agency Affected: United States Capitol Police

  6. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP established a series of regular standard and customized Financial Management System reports, which are used by accounting and management personnel to oversee and monitor the USCP's financial activity.

    Recommendation: The USCP should ensure that financial management reports produced by FFS will allow the USCP to adequately manage its own operations. If customized reports are needed by the USCP to manage its operations, then the USCP needs to ensure that provisions are established in the cross-servicing agreement to have the customized management reports produced.

    Agency Affected: United States Capitol Police

  7. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP implemented appropriate funds control mechanisms to track the availability and expected future use of salary and expense appropriations in advance of incurring liabilities for goods and services rendered.

    Recommendation: The USCP should develop and implement a system of tracking and monitoring the availability and use of all USCP appropriated funds, including any salary appropriations, prior to incurring a liability for goods or services.

    Agency Affected: United States Capitol Police

  8. Status: Closed - Implemented

    Comments: USCP implemented monthly reconciliations of salary-related disbursements processed by NFC to related disbursements charged to USCP's salary appropriations, and with respect to general expenses, utilized enhanced FMS reporting capabilities to reconcile expense disbursements to those charged to its expense appropriation.

    Recommendation: The USCP should ensure that all transactions processed on behalf of the USCP are reconciled to amounts charged to each USCP appropriation.

    Agency Affected: United States Capitol Police

  9. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP provided designated financial management and human resource personnel with appropriate classroom and on-the-job training on how to read and use NFC payroll data. In addition, USCP hired an experienced accountant to prepare salary forecasts and perform needed reconciliations.

    Recommendation: The USCP should ensure that the appropriate personnel in the Financial Management Division and the Human Resource Management Division receive training from NFC to correctly interpret and reconcile the NFC detail payroll reports to the payroll disbursements by Treasury on behalf of the USCP.

    Agency Affected: United States Capitol Police

  10. Status: Closed - Implemented

    Comments: In May 2009, The USCP established standard Records Management Operating Procedures which outlined the contents and handling requirements for information stored in employee personnel files which was subsequently, updated in July 2011. As part of the recently completed FY 2011 financial statement audit, the USCP?s independent auditor found that the personnel files for tested employees contained all required personnel information and the auditor closed out?as implemented--an open prior year recommendation associated with a weakness involving missing personnel information. As a result of these actions, GAO closed this as implemented.

    Recommendation: The USCP needs to ensure that personnel files are up-to-date and clearly document the grade, step and benefit information for each employee. Furthermore, the USCP should establish procedures to ensure that supporting documentation for all payroll disbursements is readily available should questions arise related to a payroll disbursement.

    Agency Affected: United States Capitol Police

  11. Status: Closed - Not Implemented

    Comments: In December 2006, USCP issued its Time and Attendance Certification Process Directive (Special Directive No.06.22) which required employees to ?review? their (time and attendance) certification report prior to the transmission of payroll data to the National Finance Center?the USCP?s payroll processor. Again in September 2011, USCP further refined the Directive to clarify that employees were responsible for certifying the accuracy of their certification report. While these directives address?in part?the intent of this recommendation, USCP financial statement audits, most recently for FY 2011, continue to find internal control weaknesses related to employees not certify their time and attendance information prior to its transmission to NFC for processing. In response to these longstanding weaknesses in the USCP?s implementation of the required policies, IPAs have made several similar recommendations which remain open. As a result of USCP?s recurring inability to successfully implement the employee attest/certification requirement, GAO closed this recommendation out as unimplemented.

    Recommendation: The USCP should develop and implement policies requiring all employees to positively attest to the accuracy of pay period information, prior to transmitting pay period information to NFC.

    Agency Affected: United States Capitol Police

  12. Status: Closed - Not Implemented

    Comments: In December 2006, USCP issued a Time and Attendance Certification Process Directive (Special Directive No.06.22) which required supervisors to approve the accuracy of pay period hours prior to the transmission of time and attendance information to NFC for processing. However, this guidance provides that if it is not practical to obtain supervisory approval prior to the transmission of the data to NFC that ?acknowledgment of the supervisory review and approval of the time and attendance certification report must be completed within several days following end of the pay period in question. While USCP directive establishes a requirement for supervisory review and approval of employee Time and Attendance data prior to transmission to NFC, USCP?s independent auditor continues?most recently?to find internal control weaknesses related to supervisors not certifying and approving time and attendance information on a timely basis in accordance with the applicable directives. The independent auditor has made several follow-on recommendations similar to this GAO recommendation. As a result of USCP?s inability to successfully implement its requirements for supervisory review and approval of time and attendance data prior to transmission to NFC, GAO closed this recommendation as unimplemented.

    Recommendation: The USCP should enforce existing procedures that require the corresponding supervisors to approve the accuracy of pay period hours prior to transmitting pay period information to NFC.

    Agency Affected: United States Capitol Police

  13. Status: Closed - Implemented

    Comments: In response to the recommendation, USCP reviewed its financial management operations and identified applicable operational and control requirements. The USCP formally documented the operational and control requirements in a Financial Management Improvement Plan and related Chief Administrative Officer Action Plan.

    Recommendation: USCP should review and analyze its current financial operations to determine those operational and control requirements that should apply to USCP (including any new and/or revised requirements that will arise from the USCP efforts to implement the GAO cross-servicing arrangement).

    Agency Affected: United States Capitol Police

  14. Status: Closed - Implemented

    Comments: According to the USCP, the Department implemented an automated time and attendance system (WorkBrain) which enables the USCP to electronically track regular and additional duty (overtime) hours when worked. For additional duty hours, the system requires the recordation of additional codes to track the reasons for and sources of the additional duty hours worked. When employees are detailed for long-term assignments to another operating unit, they are assigned to the temporary team where their hours worked are recorded and tracked in WorkBrain and the temporary supervisor is responsible for reviewing and approving the recorded hours.

    Recommendation: The USCP should develop and implement procedures which would allow the USCP to efficiently track all hours incurred by an officer who has been temporarily detailed during a pay period.

    Agency Affected: United States Capitol Police

 

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