At a recent meeting, independent auditor Mark Hardison presented the results of an accounts payable audit to the commissioners of Georgia's Jasper County, the Monticello News reports.
According to Hardison, deficiencies were uncovered in both the material management and internal controls in regard to the county's landfill fund.
Specifically, landfill receipts were not pre-numbered or issued in sequence, and bank deposits, receipt books, accounts payable subsidiary records, and final general ledger postings were never reconciled. Additionally, revenue transactions and audit adjustments for prior years had not been correctly recorded, and an adequate system of checks and balances for the changes to the county's payroll system was not in place, the news source reports.
Since the AP audit was conducted, a CFO has been appointed who is now correcting the deficiencies.
Although there was no evidence of embezzlement in this case, not having the proper precautions in place makes it easier for fund misappropriation to occur and go undetected. Organizations can reduce risk by implementing a system of checks and balances that does not give any one employee too much power over finances, as well as conducting regular AP audits.