MAS NEWSLETTER
A quarterly publication distributed by UMBC Management Advisory Services
Web Site: http://www.umbc.edu/mas
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VOLUME 4, NUMBER 1 & 2 |
OCT, 2003 |
LEGISLATIVE AUDIT UPDATE
CELL PHONE INVENTORY
IRS AUDIT UPDATE
HOW WILL USING PEOPLESOFT AFFECT HOW WE ARE AUDITED?
WHEN SHARING IS NOT A GOOD THING
P-CARD CORNER
Keeping Your
P-Card Secure
Change to Suspension/Revocation Procedures
PeopleSoft P-Card Procedure Changes
On August 26, 2003, President Hrabowski convened a group to discuss the current status of UMBC’s corrective actions taken in response to the last legislative audit report. Here are some highlights from the meeting:
- MAS has been following up on the items from the last legislative audit report and will continue to do so until the next audit expected to start Summer 04.
- We want to eliminate the two repeat items from the last report – Purchasing Cards and Student Accounts Receivable (SAR) – but MAS continues to find problems with lack of or untimely supervisory reviews of purchasing card activity and the Bursar’s Office staff have not been able to get adequate reports out of PeopleSoft to continue their monthly SAR reconciliation.
- One department head commented that to get control of the purchasing cards in his department, he has reduced the number of cards, centralized some reconciliation functions and instituted the use of a checklist for cardholders to complete and supervisors to review.
- The report items concerning controls over purchases and disbursements and tuition waivers have been addressed in the Procurement, Bookstore and Human Resources departments.
- The Bookstore still has a weakness in the assignment of security officer capabilities and needs to address this issue further.
- The three items on information security and control are still in process, including installing additional control hardware, issuing policies, completing disaster recovery plans and requiring new password change procedures.
MAS indicated that we will continue to contact departments to further clarify the status of corrective actions and to identify where we may be in danger of repeating a report item. We know that most departments are currently taxed with their daily requirements and will respect that giving up some of your valuable time to help one of us understand your procedures is not always a top priority. We just remind you that MAS must continue our efforts and the external auditors will not consider a stressful system implementation a reason for not following procedures.
Communication Services is attempting to compile a campus wide cell phone inventory record. A memo from Mark Behm, Vice President for Administration and Finance, has gone out to all departments asking that all employees who have been issued a cell phone coordinate with your department Business Managers and/or Administrative Assistants to complete a UMBC Cell Phone Authorization/Inventory Form. The completed forms should be collected by department or departmental cluster and returned to Communications Services. This inventory is the first step the Campus is taking to ensure that UMBC is in compliance with recent statewide recommendations of the Legislative Auditors pertaining to cell phone usage. Traditionally UMBC faculty and staff have been encouraged to take recommendations made by the Legislative Auditors very seriously; therefore your cooperation in this inventory process will be greatly appreciated. Ron Weller, Assistant Director of Communication Services (x 51234), is the contact person for questions regarding the cell phone inventory process.
In December of 2002 we notified the campus that a USM wide IRS Audit was under way. As of our last update UMBC had yet to be asked to provide any specific data to the IRS. However, in the interim UMBC was issued an Information Document Request (IDR) related to scholarships, fellowships, grants, and non-resident alien reporting. After we provided the requested information, sample selections were made and in compliance with FERPA we are in the process of contacting the selected students prior to personal identifiable information being released. No other requests have been made at this time. However, we will continue to keep the campus informed on the status of the audit.
HOW WILL USING PEOPLESOFT AFFECT HOW WE ARE AUDITED?
We have frequently been asked this question. It usually comes up when people are thinking about a process that used to have paper intensive controls but will now be handled through the security features of PeopleSoft. The answer here is that the auditors will have to learn our new system and procedures and audit us in accordance with them. We fully expect the auditors to take the time to learn about our new system before they can undertake their audit. They will still be concerned with security and controls over critical functions, but will now have to ensure those controls exist within the system. If you have any questions or concerns about how a function will be audited under PeopleSoft or if you are not sure that adequate controls are in place in your department, please contact Michele Evans at mevans@umbc.edu.
WHEN SHARING IS NOT A GOOD THING
We are taught at a young age that we should share with others. However, when it comes to our user IDs and passwords in PeopleSoft, sharing is not a good thing. PeopleSoft, when fully implemented, will control all the critical functions of our campus. Each system user will have an authorized security profile in the system and some of us will be able to adjust critical data. The ability to adjust such data was thoughtfully controlled when initially established. Please don’t circumvent those intentions by sharing your user ID and password with others or by leaving them written down in plain sight.
Keeping Your P-Card Secure
During the fiscal year ended June 30, 2003 there were 14 lost or stolen purchasing cards reported. Nine of these 14 cards were used fraudulently. Purchasing Card Program policy requires your purchasing card be kept in a safe place. Each cardholder is directly responsible for the physical security of the card. No one other than the designated cardholder is authorized to use the card for any purpose. The purchasing card should be secured in the same way you would secure your own credit card. In performing purchasing card reviews we have found the following situations which present the opportunity for fraudulent activity:
- Cardholder kept the purchasing card in an unlocked drawer to which others had access.
- Vendors maintained the card number on file and accepted orders without proof the cardholder was placing the order.
- Cardholder allowed other staff members to order goods and services from vendors.
- Cardholder lost the purchasing card.
- Cardholder did not adequately secure the card while on leave.
Don’t provide the opportunity for fraud by practicing these bad habits. If you have any questions regarding the security of your purchasing card, please contact MAS for suggestions on adequate security.
Change to Suspension/Revocation Procedures
Recent follow-up p-card reviews indicate some cardholders and supervisors are still not complying with Purchasing Card Program policy. Specifically, we continue to find supervisory reviews not conducted timely or at all, inadequate documentation, and prohibited purchases. According to the Purchasing Card Program Policies and Procedures User’s Guide, failure to comply with program policies may result in disciplinary action, including but not limited to, revocation of your card and/or termination of employment. MAS performs p-card reviews in order to minimize future audit exceptions which can affect UMBC funding decisions. We have followed a more lenient method of giving departments second and third chances before recommending the suspension or revocation of p-cards. However, due to continued findings of non-compliance, we will be adjusting our approach and recommending suspensions and revocations after first and second offenses, respectively. UMBC’s goal continues to be the elimination of repeat items from our audit reports. We hope these stepped up efforts will help us reach that goal with respect to the p-card item. If you have any questions or concerns regarding this change, please contact Michele Evans at mevans@umbc.edu.
PeopleSoft P-Card Procedure Changes
You are probably wondering how your purchasing card procedures will change with the implementation of PeopleSoft. Except for using PeopleSoft for reallocations instead of P-Card Web, you will be performing the same administrative procedures as you have prior to PeopleSoft. That is:
- maintaining logs
- maintaining adequate supporting documentation
- reconciling logs, VISA statements, and departmental accounts
- obtaining appropriate and timely supervisory approval and review
- reporting sensitive equipment purchases
- preventing prohibited purchases
Although you will not use the same reports out of P-Card Web and FAS for reconciliation purposes, you will still perform the same process. Reports to allow you to complete your reconciliations are being developed and will be available soon. Remember to go back and reconcile all months once the reports are available. If you have any questions, please contact MAS or Ina Caplan, Procurement Card Program Administrator.
KUDOS...
… to the Department of Procurement. A recently completed purchasing card review by MAS has shown that the department is managing its program well. Thanks for your efforts and keep up the good work!
MANAGEMENT ADVISORY SERVICES
Michele L. Evans, CPA
Director
Email: mevans@umbc.edu
Extension: 51354
Frances Toth, CPA
Management Analyst
Email: ftoth@umbc.edu
Extension: 56257
Sharon D. Doherty-Ritter, CPA
Management Analyst
Email: doherty@umbc.edu
Extension: 51620
Shared Fax: 51009
