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SAN FRANCISCO DISTRICT OFFICE
Audit No. 278
March 30, 1998
Limited Audit of Financial and Administrative Controls
The Office of Inspector General conducted a limited audit of the financial and administrative controls of the San Francisco District Office (SFDO). The audit procedures were limited to interviewing SFDO staff, reviewing supporting documentation, and conducting limited tests of transactions. The purpose of the audit was to provide the Commission with negative assurance that the internal controls were adequate, implemented economically and efficiently, and in compliance with Commission policies and procedures. The audit was performed in accordance with generally accepted government auditing standards during March 1998.
The San Francisco District Office assists the Pacific Regional Office in administering Commission programs in the states of Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington, and the territory of Guam. In carrying out its responsibilities, SFDO exercises a broad range of financial and administrative functions, including maintaining time and attendance records; procuring supplies and services; arranging for staff travel; maintaining an inventory of property; and recording budgeted and actual expenditures of the office.
During the limited audit described above, we identified two material weaknesses in the SFDO’s financial and administrative controls: storage of back-up tapes, and ordering of transcripts. These material issues are described below. Except for these two weaknesses, our limited testing indicated that the SFDO’s controls were adequate, implemented economically and efficiently, and in compliance with Commission policies and procedures.
The SFDO recently suggested increasing the local travel area eligible for imprest fund reimbursement. Its suggestion could be expanded to other field offices as appropriate, which could reduce Commission and Treasury administrative expense to process travel vouchers and issue Treasury checks for small amounts (see below).
The SFDO’s written comments on the draft report are attached, as well as comments from the Office of Administrative and Personnel Management and the Office of the Comptroller. Besides the material issues in this report, we verbally discussed a number of non-material findings and informal recommendations with SFDO management. SFDO generally concurred with our findings and agreed to implement the recommendations.
The SFDO stores computer back-up tapes in its offices rather than off-site (e.g., at the Pacific Regional Office or at headquarters). If a disaster occurred in the SFDO’s building, the tapes might not be available when needed.
We inspected the room in which the tapes were stored. The SFDO cannot locate the key to the room and hence cannot lock it. The room has a safe, but only one of the approximately fifteen tapes were in the safe, which was unlocked. Also, the tapes were not clearly identified by date.
The SFDO should store its back-up tapes off-site. Until it does so, it should lock the door to the storage room, keep all tapes in the safe, keep the safe locked, and clearly note the date of recording on each tape.
Court Reporter Services
SFDO enforcement attorneys directly order court reporter services from various firms, including the Commission’s main court reporter contractor. The attorneys and the SFDO Administrative Contact approve the invoice after the services are provided.
The attorneys do not have contracting authority, and a purchase order is not issued. The SFDO’s fiscal year 1998 budget for court reporters is $56,000.
A contracting officer in the Office of Administrative and Personnel Management indicated that court reporter services should be ordered through a purchase order signed by the District Administrator (unless an existing contract is being utilized). Alternatively, an authorized SFDO employee could use a government credit card to order the services.
The SFDO should use purchase orders signed by the District Administrator or the government credit card for court reporter services.
Local Travel Reimbursement
The SFDO indicated that the Commission defines local travel in accordance with the county standard used by the General Services Administration (GSA) for per diem. The County of San Francisco is quite small. Consequently, numerous requests by SFDO staff for local travel reimbursement (as low as $1.30) paid through the imprest fund had to be resubmitted on travel vouchers and paid through Treasury checks, causing additional administrative expense.
According to the SFDO, a GSA representative stated that the proper standard for local travel reimbursable from the imprest fund is mileage, normally a 50 mile radius. This standard, if adopted Commission-wide where appropriate, could reduce administrative expense.
The Comptroller’s Office should consider redefining local travel in terms of mileage.