Purpose

To determine whether the Office of Children and Family Services (OCFS) has adequate controls over the cash advance accounts it oversees to ensure the money is properly accounted for and used for appropriate business expenses. The audit covers the period April 1, 2011 to December 31, 2013.

Background

Under Section 115 of the State Finance Law, cash advances are issued to State agencies for purposes such as petty cash, travel, and other funding needs (e.g., confidential, patient, and resident allowances).  Advances are issued from agency appropriations and the cash is transferred from the State Treasury to a local bank account for use by the agency.  OCFS was authorized to have 32 advance accounts with a total value of $101,050 as of March 31, 2012.

Key Findings

• At one OCFS facility, cash receipts from a small Café, which is part of a training program for residents to learn to operate a small business, are commingled with advance account funds prior to transfer to the State Treasury. In addition, the same person signs checks, maintains the check register, and reconciles the bank account.
• As a result of increased credit card usage, the activity in the Home Office Advance Account, with an authorized balance of $25,000, has declined from approximately $57,000 of reimbursements for 282 travel advances in 2011-12 to approximately $9,000 of reimbursements for 65 travel advances in 2012-13.

Key Recommendations

• Work with the Comptroller’s Office to establish a dedicated account for the Dugout Café operation and separate the duties related to maintaining this account.
• Review the Home Office advance account usage and reduce the authorized amount to more closely match usage. Return excess funds to State Treasury.