Purpose of Audit

The purpose of our audit was to review the Village’s internal controls over cash receipts from recreational activities and information technology for the period June 1, 2011, to May 31, 2012.

Background

The Village of Rockville Centre is located in the Town of Hempstead, Nassau County. The Village is governed by an elected Board of Trustees which consists of a Village Mayor and four Trustees. The Village’s general fund expenditures for the 2010-11 fiscal year were approximately $34.1 million and for the 2011-12 fiscal year were approximately $38.1 million.

Key Findings

• The Board has not adopted written policies for cash receipts, segregated critical duties so that one individual does not control all phases of a transaction, or designed procedures so that someone is reconciling and reviewing the daily cash list to properly safeguard Village assets.
• The recreation center has one cash register that is used by eight employees without using a unique code to identify who is using the register.
• The Village also needs to improve internal controls over IT. We found that copies of back-up data are not stored in a secure off-site location, and the Board has not developed a disaster recovery plan.

Key Recommendations

• Adopt written policies and develop written procedures for the proper acceptance, handling and recording of cash receipts. Review the duties of those involved in the cash receipts process in the recreation center and institute internal controls to ensure proper segregation of duties.
• Create individual user code for each employee with access to the cash register and require each employee to sign in before collecting cash.
• Ensure that back-up copies of data are stored at a secure off-site location for retrieval in case of an emergency. Develop a formal disaster recovery plan that addresses the range of potential threats to the Village’s IT system and provides guidance for employees if the Village’s computer operations are interrupted or its IT systems or data incur loss or damage.