ULSTER COUNTY COMPTROLLER’S OFFICE
Ul lster County Sherif ff te Acco ounts Inmat
p Elliott Auerbach, Comptroller
Date ed: October 3, , 2013
OFFICE OF THE
ULSTER COUNTY COMPTROLLER
P.O. BOX 1800 KINGSTON, NEW YORK 12402
Elliott Auerbach Comptroller
Joseph Eriole, Esq. Deputy Comptroller Ronald E. Clum, CPA Dir. of Internal Audit &Control
______________________________________________________________________________ October 3, 2013 Dear County Officials: One of the County Comptroller’s Office top priorities is to identify areas where Ulster County departments and agencies can improve their operations and services in order to assist Ulster County officials in performing their functions. This includes the development and promotion of short-term and long-term strategies to achieve reduced costs, improved service delivery, and to account for and protect the County’s assets. The reports issued by this Office are an important component in accomplishing these objectives. These reports are expected to be a resource and are designed to identify current emerging fiscally related problems and provide recommendations for improvement. The following Report reviews the Ulster County Inmate Accounts managed by the Ulster County Sheriff’s Office. Inmate trust accounts are funds held in trust for individuals who are incarcerated, with any remaining balances returned upon release. The inmate trust account consists of cash carried by inmates at time of book-in, cash or money orders received from relatives on behalf of the inmates, and checks received from other inmate holding facilities at time of transfer. These monies can be used by inmates for commissary purchases during confinement. This review focused largely on the processes for managing cash flows into and out of the Inmate Trust Account.
A copy of this report was provided to UCSO in advance of its release and their comments taken into consideration in the final draft.
If we can be of assistance to you, or if you have any questions concerning this Report, please feel free to contact us. Respectfully submitted,
Ulster County Comptroller
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 I. AUTHORITY___________________________________________________________
The Office of the County Comptroller conducted this review and produced this Report in accordance with the Comptroller’s authority as set forth in Article IX, Section 57, first paragraph, and Sections 57(A) and (G) of the Ulster County Charter, as well as applicable State laws, rules and regulations. II. BACKGROUND _______________________________________________________
At time of incarceration persons in custody are stripped of all personal belongings which are stored until release. If at this time the inmate is in possession of any monetary items, which may consist of cash, payroll checks, and any government issued checks, the funds are deposited into the Ulster County Sheriff Inmate Account, a bank account, in which subsidiary accounts track each individual’s activity. The Ulster County Sheriff’s Office (“UCSO”) implements a software program, CORE, supplied by Aramark, which aids in the tracking of the individual inmate account activity. During incarceration, an inmate may charge their account to purchase items not normally provided by the jail, including additional food, toiletries, and services such as haircuts. Funds may be added to an inmate’s account by third parties through the mail or deposited via the web, phone, or a KIOSK dedicated to this purpose located at the jail. Once released, an inmate is refunded their remaining balance by means of a debit card. As of December 31, 2012, Ulster County had 1,346 inmate accounts totaling $25,485. III. OBJECTIVES AND SCOPE______________________________________________
The general objectives for this review were to provide reasonable assurance that: 1) Inmate account collections are appropriately safeguarded and deposited in an accurate and timely manner 2) Inmate transactions are properly recorded to the inmates’ subsidiary account accurately and timely 3) Expenditures were accurate according to the inmates’ request 4) Adequate controls are in place to fully account for all activity through the inmate accounts 5) Inactive inmate accounts are monitored and transferred to the New York State Comptroller’s Office as unclaimed funds 6) Bank reconciliations are being performed, reviewed, and tied to the subsidiary accounts on a monthly basis The scope of this review included transactions for the year ended December 31, 2012.
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 IV. THE PROCESS – Cash In ________________________________________________
When persons held in custody are brought to the jail they go through processing and booking. At this time, if the person in custody is in possession of cash, payroll checks, or a government issued check they are confiscated and recorded in a log, known as the “Inmate Money Accountability Sheet.” This documents the date, amount, inmate name, and is initialed by the intake supervisor and a witness. During this process the inmates’ cash deposit is registered into the CORE software system detailing: inmate’s name, number, date of birth, date of intake, transaction description, and amount deposited. Any cash confiscated are then placed in an envelope with the corresponding information identifying the inmate and is then placed into a drop safe until deposited. Inmates are provided a receipt at time of booking. The following morning, staff from the Civil Division, who are the sole custodians of the key for the safe, retrieves the money from the drop safe, verifies the cash, signs the Inmate Money Accountability Sheet, and prepares the deposit which is placed in a secured numbered bank bag. These funds are then deposited into the bank account by a deputy officer. Once the trust account is established for the inmate, funds can be added by means of: (i) deposits into a centrally located KIOSK, (ii) via a secure website or phone system, or (iii) mailed in money orders (on rare occasion cash is mailed and accepted according to Civil staff). Inmates can also earn “income” while incarcerated by performing duties which include: laundry, sewing, floor maintenance and working in the kitchen or barber shop. However, no cash exchanges hands when the inmates are compensated, the time is tracked by the correction officer in charge, and the inmate accounts are credited for their time and services accordingly. During the year ended December 31, 2012 deposits into the bank account totaled $461,075, or approximately $38,000 per month. V. THE PROCESS – Cash Out
Funds can be released from an inmate’s trust account for reasons such as commissary purchases, inmate purchases, third party release requests, correctional facility transfers, and inmate releases. Inmates can also be charged for various fines, penalties, and court order judgments. While confined, inmates have access to a “store” within the jail, called the “Commissary.” Inmates may purchase products including hygiene items, snacks, writing instruments, etc., from the Commissary if funds are available in their accounts. When an inmate makes a purchase, the Commissary Assistant checks them out with a scanning gun by way of a bar code on their wrist bands. If the purchase is permitted (i.e., the inmate has sufficient funds and no dietary restrictions), a receipt is printed directly from the scanning gun and provided to the inmate. Other expenses that are the inmate’s responsibility and may be charged to their account include postage, photocopies, haircuts, and property damages. Inmates may request funds to be sent elsewhere as a third party request. These requests must be in writing on a form called a “blue sheet”. These blue sheets contain information that should be completed by the inmate detailing where the money is to be sent, to whom the check is payable, 2|Page
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 a brief description of the reasons for disbursement, and a signature authorizing the check. Once a request is completed, the Corrections Assistant processes the transaction and delivers the requested check to the inmate to verify the details prior to sealing the envelope and mailing. Inmates released from incarceration or transferred to another correctional facility, are disbursed all funds belonging to them. If they are transferred to another correctional facility, a check is issued for the remaining funds in the transferred inmates’ trust account and delivered with the inmate to the new facility. At the time an inmate is released from serving their sentence they are provided with a debit card for access to their remaining balance. In reconciling the subsidiary accounts with the inmate log, as of December 31, 2012, it appeared more inmate accounts existed than there were inmates held at the facility. This results from inmates leaving the facility without waiting to receive their payouts. Inmate accounts with a balance which have been inactive for more than two years are turned over to the New York State Comptroller’s Office as unclaimed funds. During the year ended December 31, 2012, disbursements out of the bank account totaled $474,581, or approximately $40,000 per month. VI. THE ACCOUNT
The inmate account is currently maintained through a trust fund software system implemented by Aramark, called “CORE”. Prior to CORE’s implementation, which started in September 2012, UCSO used another Aramark software, “ACTFAST.” Hereafter, both will be referred to as the “software system.” The current software system is a vital part of the entire Commissary structure and interfaces with several different components, such as the KIOSK and web-based transaction system (“TouchPay”), UCSO’s Bank of America account, and the Commissary account from which purchases are made. On a daily basis, Civil Staff prints TouchPay cash drawer reports and compares them to the deposits in the Bank of America account to ensure all monies transferred properly. For the intake drawer, Civil Staff prints the activities to ensure that all monies are received and placed into the drop safe during the previous 24-hour period. VII. SCOPE AND METHODOLOGY __________________________________________
This review evaluated the internal controls and processes over the administration and use of the Inmate Trust Fund for the period of January 1, 2012 through December 31, 2012. The methodology included inquiry, observation and testing of relevant documents over the following: 1) Evaluated controls and processes over cash receipts (mail and inmate credits and electronic “Touchpay” deposits) and tested a random sample of transactions 2) Evaluated controls and processes over cash disbursements (3rd party releases, inmate releases, and vendor payments) and tested a random sample of transactions 3) Analyzed the Bank of America Inmate Trust Fund Statements for the year 2012 to tie the above samples to the bank statement 3|Page
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 4) Evaluated cash receipting, disbursing, and reconciliation processes for inmate accounts VIII. FINDINGS AND RECOMMENDATIONS ___________________________
Below is a summary of findings made during this review followed by recommendations which should be considered by UCSO administration. The majority of the findings relate to internal control issues; mainly separation of duties and improved account oversight, and the need to implement or update certain documenting procedures. Finding #1: Bank Reconciliations not Prepared Bank reconciliations are a report which compares the bank balance, per the bank statement to the accounting records kept in the subsidiary ledger of an account. Preparation of a bank reconciliation helps in identifying errors in the accounting records at any given point in time. The liquidity of cash increases the inherent risk. Due to its vulnerable nature, all necessary internal controls should be implemented to reduce the risk and help uncover any irregularities. The reconciliation of bank account balances with accounting records is a necessary element of an effective internal control system for cash. This “check” should be done as a routine procedure at the end of every month, and signed by management, in order to ensure accuracy and accountability for all cash transactions. Our review identified that bank reconciliations were not being prepared due to conversion to the newer software system. Our review further identified outstanding checks dating back to 2010. These outstanding checks are an indication that disbursements were not properly issued or received and may result in a loss or claim. Having stale dated checks on the account erroneously reduces the cash, as these checks are no longer negotiable at this point in time. Recommendation #1: Since our initial visit, UCSO staff reached out to the software company and has been working closely with them in order to prepare bank reconciliations that agree to the software system. As of June 2013 the account appears to be off approximately $300 and may be attributed to inaccuracies during the transition to the newer software as well as timing issues. We recommend that UCSO continue its efforts to complete and forward these bank reconciliations to our Office along with the preparer and supervisor’s signature. They should also identify and correct old balances so that the total of the inmate accounts tie into the reconciled cash balance at the end of each month. The requirement for dual signature and reviews on the bank reconciliation will act as an additional safe guard over the cash handling process To ensure that the account is current we recommend that UCSO staff routinely reconcile outstanding checks and either void and reissue to the payee or turn the funds over to the NYS Comptroller’s Office as unclaimed funds.
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 Finding #2: Third Party Inmate Release Request When inmates request money to be disbursed from their account they must submit the request in writing on a “blue sheet”. This form documents the purpose, the payee, the amount, and has an area for the inmate’s signature. This blue sheet is also used for non-cash disbursement related requests such as visitation and legal material requests. The form is provided to the Commissary Assistant responsible for preparing and delivering the check with an envelope to the inmate for their review and to seal it for postage, handled by jail staff. This sheet is an important aspect of the disbursement of monies as it documents the requested payee and dollar amount. During our cash disbursement testing, we selected and reviewed a number of third party inmate requests along with other disbursement types. We attempted to trace the inmate disbursements back to the blue sheets to verify the request made by the inmate and the accurate disbursement out of their accounts. Of our sample, only 38% had blue sheets which supplemented the inmate requested disbursements. This may be a consequence of not having a sufficient filing system in place. Blue sheets were provided in a box with a number of years mixed together and in no apparent order. When we organized the blue sheets in month and year order, we examined the months of January, April, September, and November of 2012, to determine if these blue sheets were signed by the inmates. This test revealed that 13 of the 60 were not signed, or a 22% error rate. Recommendation #2: The finding above concerns us in two areas: (i) lack of supporting authorization for the inmate disbursements and (ii) lack of a well-maintained filing system. Authorization - As discussed above the blue sheet documents the inmates’ request to have funds removed from his/her trust account. Without this documentation the UCSO is susceptible to accusations from inmates as to the authorization for disbursement and/or the dollar amount disbursed. We recommend that these blue sheets be filled out in their entirety and include all required signatures which appear on the form, which would include a space for the officer’s acknowledgment of receipt of the request. It is also advised that the blue sheets contain the check stubs produced as it is the sole source of justification for the disbursement. We also recommend that a certifying signature section be added to the form where the inmate acknowledges their review of the check for discrepancies and certifies that it was enclosed in an envelope for postage to the requested payee. The certifying signature would be sufficient documentation to supplement a dispute from an inmate against improper payment. Filing System - As noted, our Office was not able to review many of the requested blue sheets either because these forms were not properly filed, or the forms were never completed by the inmate. We were, however, informed that during 2013 a “new filing system” was implemented due to staffing changes, and currently, the blue sheets are filed in a folder by the month the transaction takes place.
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 It was also discussed that in the future, blue sheets may be scanned into a computer generated file and placed within the inmate’s folder. These folders contain all pertinent information about the inmate while incarcerated at the Ulster County Jail. We recommend that either system employed by the Sheriff’s Office be capable of retrieving the blue sheets upon request and are filed in accordance to protocols in place for the implemented system. We also recommend that the procedures for filing under the new system are incorporated into the Sheriff’s General Orders (UCSO’s procedure manual) to act as a guide for new hires or active personnel responsible for this job duty. Finding #3: Concerns with Cash Disbursement Cash disbursements usually have the highest risk for error and opportunity for the misappropriation of funds. Sufficient internal controls over the accounts payable function include matching authorized purchases to receipt of goods or services and vendor invoices. The objectives of internal controls over cash disbursements are to ensure cash is disbursed only after proper authorization, and that money is released for valid authorized purposes, and the transactions are properly recorded. During the course of this review, we uncovered many disbursements as to which documentation was missing to support the claims. This was most prevalent with the “blue sheets” required to initiate disbursement on the inmate’s behalf. As mentioned previously, the forms available for our review were significantly lacking essential information as well as authorizing signatures. The missing information and lack of supervisory approvals for non-inmate purchases was concerning as well, as it made validating those charges difficult. We recognize that the checks had been signed by authorized signors but it cannot be assumed that the backup was provided at the time to support the claim. This approval process should be initiated immediately to document the backup was present and agrees to the amount to be paid. Another area of concern in regards to cash disbursement function was the use of two separate check stocks. In order to guarantee accountability, checks should be written in sequential order allowing for easy detection of fraudulent or incorrect payments clearing the account. In testing transactions and reviewing inmate’s trust accounts, one of the sampled accounts showed a negative balance due to a timing difference with the system. The individual whom was released from jail had made a purchase the prior day with funds available to them, the next day (prior to a system update) all funds in the individual’s account were disbursed, causing the account to go negative once the purchase was posted. Recommendation #3: Review and approval of invoices should be performed by someone who can verify services rendered, or goods received, so that they can be confirmed to be consistent with the invoice for payment. In addition, records of the inmates’ approved transactions should be documented and maintained to support payments. It is further recommended, that the required blue sheets be maintained and completed in their entirety with the inmate signature to ensure payment issuance was authorized. Also, the check stock that is currently in use needs to be in one central location so that employees who need access must sign the stock out and that the 6|Page
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 check sequence remains in order. Furthermore, all transactions (posted and non-posted) must be verified to have cleared the account before funds are released to the inmate before departure. Finding #4: Concerns with Cash Receipts A well-designed set of control procedures can provide reasonable assurance misappropriation of funds will be uncovered. Strong internal controls over cash include segregating cash handling functions amongst the three stages of cash management: receiving, depositing and reconciling, amongst separate individuals for each stage of the cash handling process. This internal control reduces the risk for an employee to misappropriate funds and for those misappropriations to go undetected. For departments that do not have the staffing to implement this control, it may be necessary to rely on compensating controls to mitigate the risk instead, such as increased monitoring by management. While reviewing the cash receipt process, three areas were of concern, summarized below: 1) Inconsistency in maintaining a mail log, 2) Untimely deposits, and 3) Inconsistencies with the daily deposit Mail Log - During our review we identified inconsistent maintenance of documenting the items an inmate receives through mail. Currently two individuals are responsible for the oversight of inmate receipts that come through the mail. We examined an Inmate Mail Roster which documents what items an inmate received such as personal letters, photos, legal documents, and/or money (Money Orders, or Cash). Only one of the employees responsible for the cash receipt function was maintaining this Mail Roster. The absence of adequate documentation and oversight of the cash receipts via mail interferes with the capability for an independent verification over the funds received. The documentation into the mail log is even more critical for the unlikely event cash is received, which we were informed does happen on occasion even though it is strongly discouraged. Sufficient documentation of cash receipts would allow an independent source to verify that the funds received through the mail reconcile to the mail credits recorded in the software system. Untimely Deposits - Strong internal controls over cash receipts instruct they be handled in a timely manner and therefore should be deposited within a reasonable timeframe. The risk for loss or theft of cash increases the longer it remains un-deposited. Our review of the controls over cash receipts identified instances where deposits were made approximately 5 business days after the initial posting to the inmates account in the system. This timing difference may provide difficulty in reconciling the bank accounts in the future as indicated in finding #1. Inconsistencies with the Daily Deposit - Our review of the controls over daily deposits identified one employee incorrectly processing cash receipts collected from inmates processed through booking the prior day. This employee was not preparing the deposit under dual control with the 7|Page
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 intake officer. Instead, the employee was documenting the cash receipts on the CORE system printout, maintained control over the cash and later prepared the deposit slip. There were many inconsistencies with the cash receipts and bank deposits and although the inconsistencies were corrected, they could have been avoided had the employee carried out the proper control procedures and prepared the deposit with the oversight of the intake officer. The inaccuracies in the reconciliation of cash receipts to deposits, and the risks associated with handling cash, caused us to expand our scope to include a review of the accountability log. This log consisted of an estimated 1,000 intake credits from which we compared the results to the software system’s deposit record. This expanded documentation and reconciliation is recapped in Table 1. The reconciliation identified the following: 1) Items had erroneously been entered as mail deposits when they were funds taken at intake processing 2) Items not being entered into the software system, therefore had not been posted to the correct inmate account 3) Items being entered directly into the software system, while never being entered in the accountability log
Table #1: Reconciliation of Accountability Sheet to Computerized System
Balances per Computerized Systems: 1st System (ACTFAST) Voided transactions $ 80,295 (1,862) $ 78,433 2nd System (CORE) Voided transactions Sub-Total: Items entered as mail credits (should have been intake credits) Items never entered into the computer system 26,033 (352) 25,681 104,114 2,176 70 $ 106,360 Balances per Accountability Sheets: Total of acccountability sheets Plus: Items entered into systems and not onto sheets $ 98,808 7,552
8 | P$a ge 106,360
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 Recommendation #4: We recommend that a mail log be maintained by all employees who are in charge of receiving and opening the daily mail. This new procedure will monitor and verify the amounts received through the mail to the software system. During the intake deposit process, we recommend that the civil employee responsible for the cash receipts during booking record the amounts received immediately into the accounting system and directly onto the deposit slip, with the intake officers oversight, to ensure the monies collected agree to the accountability sheets, uncovering any variances immediately. UCSO should document and implement new procedures over the cash receipt process and incorporate the procedures into the Sheriff’s General Orders. These procedures should include guidelines for: cash receipts via mail, emphasizing the use and maintenance of the mail log; an acceptable time frame for the daily deposits to be transacted, strong internal controls would suggest the deposit be transacted within 2-3 business day of the cash receipts; and guidance for the requirement of dual controls over the cash handling process. Furthermore, UCSO should consider separating accountability logs in relation to intake, bail, and any other form of cash coming through processing. These logs could be reconciled monthly to tie into the software systems and errors and/or mistakes could easily be detected. Finding #5: Lack of Adequate Internal Controls Internal controls are procedures implemented to ensure the integrity of financial reporting, operations, and compliance within an organization. The use of controls helps prevent errors and detect fraudulent activity. Internal controls do not guarantee freedom of errors and waste, however, they do provide reasonable assurance that individuals are in compliance with internal and external procedures and regulations. Our review of the controls in place as they relate to the inmate account identified numerous internal control weaknesses. It is important to note, however, that at the outset of this review, we were informed that the procedures concerning the inmate account were in the process of revision, and the findings below may have been addressed since our review. The primary concerning weaknesses identified during our review are discussed below: Lack of separation of duties – Currently the employee charged with preparing bank reconciliations is also receipting cash and disbursing checks as well as having access to journal entry capabilities on the account. Additionally, although we have been told this has been updated, this same individual had signatory authority on the account and had signed off on multiple disbursements during the review period. Lack of authorization or supervision – As the procedures appear to stand now, transactions are processed without oversight. There appeared to be no official documentation for journal entries or voided transactions and therefore no authoritative oversight to process these transactions. Several individuals have access to two separate check supplies, and these same individuals also have signing authority. As previously mentioned, bank reconciliations also have not been reviewed or signed off on.
ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 Inconsistencies in receipt of mail – The mail processing is shared between two individuals who engage different methodologies when performing this task. One employee incorporates a log which documents the category of mail (i.e. Personal, Photos, Legal, or Money Order). This log is to protect against disputes that an inmate might bring upon UCSO in accordance to the mail. The other employee, who is an Officer, upon information and belief, does not prepare such a log. These two individuals are also responsible for entering any funds received into the inmates’ trust account. Gaps exist in transaction numbering – The computer generated transaction identification numbers have many gaps according to the information that was provided. This weakness in the software leaves it difficult to reconcile a batch of transactions at the end of processing. The system should be able to detect any gaps in a series so that it might alert management to the possibility of missing or misplaced transactions.
Recommendation #5: Separation of duties is significant in establishing adequate internal controls as well as documenting the acceptable procedures and policies for employee reference. We recommend that UCSO continue their development of the control procedures over the inmate trust account and in doing so address the concerns discussed above. The most essential relating to security controls that can be built into the software program granting and restricting access to individuals and their duties, implementing adequate oversights on transactions in the account, employing a mail log that is consistent among employees, and investigating any irregularities in transaction numbering within the computer system. IX. SUMMARY OF RECOMMENDATIONS
Bank Reconciliations: Bank reconciliations should be signed and dated by the preparer Bank reconciliations and the supporting documentation should be reviewed and signed off by a supervisor who has a general understanding of the account reconciled The supervisor should review the bank statement to identify any unusual transactions or vendors/payees The UCSO should assign an individual to prepare the bank reconciliation who does not have any responsibilities over the other cash functions of the office (i.e. receiving cash, depositing cash, entering transaction, voiding transactions, and making journal entries) Items Dealing with the “Blue Sheets” The UCSO should establish an official filing system for the blue sheets in order to retrieve them when required. When it is finalized it should be added to the Sheriff’s General Orders. All blue sheets should be filled out in their entirety and signed by the inmate upon the initial request There should be a section added to the blue sheet for the inmates acknowledgment of the payee and amount to discourage any questioning later on A section should also be added allowing the overseeing Corrections Officer to sign off verifying acknowledgement of the request.
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ULSTER COUNTY SHERIFF INMATE ACCOUNTS October 3, 2013 All blue sheets should contain the documentation and check stubs attached to justify disbursements.
Cash Receipt Issues The Inmate Mail Roster should be completed by the employees responsible for opening the incoming mail at the Ulster County Law Enforcement Center. The monetary funds logged on the mail roster should be reconciled every month end with the accounting system by an independent party. UCSO should standardize an acceptable time frame for deposits of cash receipts at a maximum of 2-3 business days. UCSO should implement a procedure that requires deposit slips to be filled out and recorded into the accounting system for monies received at intake to reduce the discrepancies over cash receipts and deposits. UCSO should also consider keeping separate logs for bail and fines paid at the intake division so as to be able to tie the Inmate Accountability Sheet directly to the CORE system by any given date in time. Other Items UCSO should contact Aramark to inquire if the current system limitations over assigning transaction ID numbers could be altered to a sequential numbering system. UCSO maintain one central location for check stock to ensure adequate control over these monetary instruments and requested check stocks should be inventoried on a log and signed by the requesting personnel. All check stubs should have the relevant backup attached to it and management’s initial that authorized it to be paid. They should all be filled in one location in order to maintain suitable accounting records. X. CONCLUSION__________________________________________________________
Our primary objective was to ascertain that the cash collected from inmates agreed to the accounting records kept at UCSO. We further wanted to ensure that proper oversight and adequate controls are in place to prevent UCSO from any unforeseen weaknesses. We are pleased to report that the cash collected di reconcile o the UCSO’s accounting. Our recommendations predominantly deal with strengthening internal controls and management’s oversight to continue the development of safeguards of the Sheriff’s Office and their personnel. A copy of this report was provided to UCSO in advance of its release and their comments have been taken into consideration with the final Report and are attached as Appendix A. We wish to thank the officers and staff of UCSO for their cooperation and assistance during the preparation of this report. Respectfully submitted, Ulster County Comptroller 11 | P a g e
Written Comments of UCSO
Paul J. VanBlarcum
Office of the
Frank P. Faluotico Jr. Undersheriff Michael O. Freer Captain / Criminal Division James R. Hanstein Superintendent / Corrections Division
Ulster County Law Enforcement Center 380 Boulevard, Kingston, NY 12401
September 16, 2013
To: Ronald E. Clum Re: Inmate Accounts Audit
Area Code 845 Administration Criminal Division Corrections Division Civil Division Pistol Permits Crime Tips Hotline Fax (Administration) Fax (Criminal Division) Fax (Corrections/Records) Fax (Corrections/Booking) Fax (Civil Division) Fax (Detectives)
340-3802 338-3640 340-3644 340-3643 340-3639 340-3599 331-2810 340-3718 340-3468 340-3436 334-8125 340-3588
Ron: The Ulster County Comptroller conducted an audit concerning accountability and controls of the Ulster County Sheriff’s Office Inmate Accounts. A review of the draft report issued by the Comptroller’s Office did not indicate any misappropriation of inmate funds by any member of the Sheriff’s Office; but did cite some deficiencies concerning internal controls and offered recommendations for enhancement. As I have previously stated we have only one Junior Accountant to monitor all inmate financial transactions. Since the issuance of this draft report, I directed Captain Lou Russo to meet with Corrections Assistant Officer Linda Sloane and Junior Accountant Ms. Laura Romano to discuss the recommendations offered in this report. I have summarized their discussions and action taken in response to these recommendations Summary of Recommendations Section IX pages 10 and 11 Bank Reconciliations page 10 1. Bank reconciliations will be signed and dated by the preparer moving forward 2. Sheriff will designate the appropriate level of management to review and sign bank reconciliations 3. Currently, the Undersheriff reviews all bank statements for the inmate accounts 4. Currently, the Junior Account only prepares the bank reconciliation and journal entries for the inmate accounts; other cash functions are only completed by the
An Accredited Law Enforcement agency since 1990
Junior Accountant in exigent circumstances. We will continue to establish levels of accountability.
Items dealing with the “Blue Sheets” page 10 and 11 1. A bi- monthly filing system has been established. The file will include the signed carbon receipt by the inmate, the check stub indicating the signatures of the inmate/Corrections Assistant and the “Blue Sheets’ “Inmate Request Form (UCJ-26)”. The procedure for this filing system will be added to the appropriate section of the Sheriff’s Office Policy and Procedures. 2. When the Corrections Assistant receives a request from an inmate to disburse money to a payee, the Corrections Assistant will ensure the UCJ-26 is completed in its entirety and signed by the inmate. 3. Due to the current stock of the UCJ-26, the acknowledgement language will be added in the future. In the interim, the inmate will initial the section concerning the amount of money being disbursed to a payee as requested. 4. Signature area for the Corrections Assistant will be added as stated above in response to item 3 for the purpose of verifying the inmate’s acknowledgement of funds to be disbursed to a payee. In the interim, the Corrections assistant will initial in the area of the payee and sign below the inmate’s signature. 5. All documents concerning the disbursement of inmate funds to a payee will be archived together as stated in response to item 1. Cash Receipts Issues page 11 1. Clarification-the inmate mail roster was created by the previous Corrections Assistant to track all items received by inmates through the mail (e.g., photographs, money etc.) for only mere convenience. In the case of the inmate funds received through the mail, the Corrections Assistant will electronically record all monetary deposits on an excel spreadsheet on a daily basis and archive this information on the Corrections Division server. This information will be readily available upon request. A signed final transaction report will be forwarded to junior account each day for review. 2. As stated in item 1, the reconciliation is being done daily. 3. The Sheriff’s Office will strive to ensure cash deposits are done within 2-3 business days
4. Currently, this recommendation is being implemented. 5. Currently, the corrections division is in the process of change the bail procedure; once these changes are completed a separate log if necessary will be implemented. Other items page 11 1. The Ulster County Sheriff’s Office to work with ARAMARK in the upgrade and correcting software. 2. Currently, this recommendation is being implemented. 3. Currently all check stubs have the relevant supporting information and required authorizing signatures. Due to the nature of the disbursements, filing is done according to the type of disbursement and archived during the year conducive to work locations; however, at the close of the year disbursements are archived at the Ulster County Hall of Records under the title of Corrections.
As always, the Ulster Sheriff’s Office will strive to maintain and to enhance safeguards for financial records. I would like to thank members of the audit team for their recommendations and professionalism.
Respectfully submitted, Paul J. VanBlarcum Ulster County Sheriff