Transcript No Slide Title

Audit Services
Best Practices
April 20, 2010
Overview
Introductions
About Audit Services
Best Practices
Introductions
QUEEN’S AUDIT SERVICES
Audit Manager: Angela Riddell
Senior Internal Auditor: Kellie Hart
Internal Auditor: Ed Lew
http://www.queensu.ca/rmas
Audit Services Responsibilities
 Assist management and the Board of Trustees in
the effective discharge of their fiduciary and
governance responsibilities
 Report administratively to the VP (Finance &
Administration) and functionally to the Chair of the
Audit Committee
 Accomplish objectives by bringing a systematic,
disciplined approach to evaluating and improving
the effectiveness of control and governance
processes
Audit Services Responsibilities
 Provide independent, objective assurance and
consulting services designed to add value and
improve Queen’s University operations
 Promote a strong risk management culture to assist
the University meeting its objectives
Audit Services Responsibilities
Risk Management (moved to VP Finance & Administration):
 Identify those risks most critical to Queen’s
achieving its goals and objectives
 Identify what is currently being done to mitigate
those risks and if anything further needs to be done
to manage risks and to be able to seize
opportunities
 Iterative process
 NOT about avoiding risks
Audit Services Responsibilities
Efficiency, Effectiveness, Integrity, Compliance:
 Proactive involvement in new process or system
implementations
 Assist in policy development and training
 Internal audits based on risk assessments
 Audit Services is here to HELP!
Audit Services Responsibilities
Governance:
 Assist Audit Committee by researching best
practice governance issues
 Report regularly to the Chair of the Audit
Committee
 Provide summary reports to the Audit Committee
on internal audits and other issues
Best Practices
 GST
 Petty Cash
 Procurement Card
 Cash Receipts
 Travel
 Journal Entries
 Amex Card
 Equipment Lists
 Expenditures
 Salary Requisitions
 Account Reconciliation
 Research Expenditures
 Summary Financial Reports  Ask!
GST
 Always ensure you record GST on all travel claims,
cheque requisitions, procurement card
transactions, etc.
 Recording the GST will save your department $$$
 Your department is only charged 33% of the GST
paid (1.66% rather than 5%)
 GST paid on books is not charged to departments –
Financial Services will be issuing a communication
regarding the process to follow
GST & Travel
 You need to add up the GST on all travel receipts
that are being claimed
 The on-line travel expense claim form will
automatically calculate the GST on meal allowances
(per diems), mileage and taxi claims
 If you are calculating GST from a total that includes
GST multiply the total by .0476 to determine the
GST
 HST will be effective July 1, 2010 – training by
Financial Services to follow
General Expense and Travel Claim
Forms
Sample Travel Expense Claim Form
GST & Procurement Card
 When checking your transactions always ensure
the GST is recorded correctly, especially on foreign
currency purchases, or purchases where it states
that GST is included
 Change the amount shown to what it is on the
invoice or receipt
Sample Procurement Card Review
Procurement Card
 The procurement card is the responsibility of the
person whose name is on the card
 The procurement card should always be kept in a
safe location
 The procurement card should not be used for
restricted transactions (i.e. travel, entertainment,
personal purchases, furniture, alcohol, etc)
 Can be used for conference registration (but details
should be filed with the travel claim)
Procurement Card
 Purchases may only be made by the individual to
whom the card is issued
 Any expenditure less than $2,000, that does not
contradict above policy limitations, should be
charged to the procurement card
 Edit transactions in Access Direct to ensure the
GST calculations and Account ID codes are correct
and agree to supporting documentation (i.e.
receipts, etc.)
 PRINT the reconciled cardholder statement and
attach all supporting documentation slips
Procurement Card
 The reconciled cardholder statement must be
signed by the cardholder and approved by the
cardholder’s supervisor
 The approved cardholder statement, along with
supporting receipts, must be maintained in the
department for 7 years (or longer if CFI-related
research expenditures) and is subject to audit at
any time
Sample Procurement Card Review
Sample P-Card Change Request Form
Travel
 Utilize most economical means of travel
 Obtain travel advance if needed
 Include details on the business purpose of the trip
 Include conference itinerary
 If meals are not provided, please note
Travel
 Any expenditure greater than $10 must be
supported by receipts
 No receipts for per diem meal allowances
 Include original boarding passes
 Credit card slips are not sufficient
 Missing receipt form
 One over one approval
Sample Travel Expense Claim Form
Sample Travel Expense Claim Form
Sample Travel Expense Claim Form
Travel Continued
 If meals include entertainment expenses, note
names and organizations of those entertained
 Submit claims within 15 days of travel- especially
important if there has been a travel advance
 Cheque requisition payments to travel agencies
require one over one approval
Amex Card
 Employees who incur business expenses on behalf
of the University may apply for an Amex card
 Personal expenses are not to be charged to the
Amex card, only Queen’s University business
expenses
 The monthly balance is paid directly by the
cardholder and not charged directly to a University
account
 There is no annual membership fee for the card
Expenditures
 Appropriate and cost effective
 Employee reimbursements – one over one approval
 Purchase orders for items greater than $2,000
 Cheque requisitions greater than $10,000 must be
approved by the Dept. Head/Dean/VP
Expenditures
 Competitive bids for items greater than $10,000
 Public posting for items greater than $100,000
 Entertainment type expenses (staff functions, gifts etc.)
– one over one approval
 Cheque requisition form
 Ensure coded to the correct Account ID
Sample Cheque Requisition Form
Sample Cheque Requisition Form
Sample Cheque Requisition Form
Expenditures
Questions to Ask:
1. How well do I know this vendor or contractor? Do
I have first hand knowledge that they even exist?
2. Do I know that they actually provided the goods or
services identified in the invoice or other billing
statement?
3. Do I know that they are using the correct amounts
for price (including unit prices used), sales tax,
freight, and other variables that make up the
amount invoiced?
Expenditures
Questions to Ask:
4. On what basis do I know that the prices are
reasonable in the first place? What standard have I
used in determining that the price charged is fair?
5. How do I know that the quantities make sense? On
what basis have we agreed to purchase the stated
quantities?
6. How do I know that the invoice and other
documents are mathematically correct?
7. Do I know that this invoice has not already been
paid?
Account Reconciliation
 Print monthly Statement of Operations report from
PeopleSoft
 Agree all transactions to supporting documentation
 Ensure coded to appropriate Fund, Department,
Account ID, Program, Class etc.
 Show evidence of reconciliation
Summary Financial Reports
 Monthly Statement of Operations Summary report
 Department heads may only require summary
information
 Try to avoid using alternate tools
Petty Cash
 Only maintain if necessary
 Secure location and one person responsible
 Never use for wages or IOU’s
 Keep a petty cash log and chits for all
purchases/uses
Petty Cash
 Replenish by cheque requisition (never with
miscellaneous cash receipts) and record to correct
expense account code
 Balance receipts and remaining cash to petty cash
balance
 Normally a maximum of $200
Cash Receipts
 Try to minimize cash handling
 Segregate duties  person receiving cash is not
responsible for reconciling
 Keep cash in a secure location with limited access
 Deposit on a timely basis to Financial Services
 Financial Services prefers deposits be made by
1:30pm each day
Cash Receipts
 Use a bonded courier service for significant
deposits
 Donations should be sent to Advancement
 Record as revenue or recoveries
 Never open an external bank account
Journal Entries
 Journal entries should contain documentation
indicating the reason for the entry
 Backup must contain sufficient information to
enable an auditor to identify the specific charges in
the original account
Journal Entries
 System users are responsible for maintaining the
necessary supporting documentation for those
entries
 Every attempt should be made to ensure account
coding is accurate initially and not rely on recoding
of information at a later date
 To request access to create journals, complete the
PeopleSoft Finance Security Access Request form on
the Financial Services website at
http://www.queensu.ca/financialservices/forms.html
Equipment List
 Departments are responsible for knowing where all
equipment purchases are located
 Equipment is the property of Queen’s University
 Keep an updated list of all equipment
 Date purchased
 Description
 Serial number
 Location (building and room number)
 If equipment is located off-site, complete an
“Acknowledgement of Off-site Equipment Form”signed by Department Head
Salary Requisitions
 Casual salary pay – controlled at the department
level
 Keep approved time sheets – can be a simple
summary of days and hours
 Keep a record of how the hourly rate was
determined – consult HR
 If the employee is a friend or relative of someone in
the department, ensure approval is at a higher level
Research Expenditures
 Queen’s policies and procedures apply to research
accounts
 Familiarize yourself with the granting agency
guidelines, which are often complex and contain
specific terms
 If the granting agency’s guidelines are more
restrictive than Queen’s policies, then the granting
agency’s guidelines must be followed
Research Expenditures
 There are regular Tri-Council and Canada
Foundation for Innovation (CFI) workshops for
principal investigators and departmental
administrators
 Each granting agency has specific rules – ask
Financial Services in advance of any questionable
purchase
 All financial reporting to granting agencies should
be reviewed by a Financial Services representative
Research Expenditures
 Tri-Council grants (NSERC, SSHRC, CIHR) have
specific salary maximum and minimum rules
 Tri-Council grants do not allow additional health
insurance during travel, gratuities or alcohol
expenses to be claimed
 CFI grants have very specific budget proposals to be
followed (identified by individual line items)
 Follow Queen’s Purchasing Policy on all purchases
Research Expenditures
 Ensure PeopleSoft reflects research grant or
contract budget
 Review any overhead received and ensure proper
amounts credited to accounts
 If a U.S. dollar award, ensure current exchange
rates and future projections are realistic and are
reflected in expenditure planning
Ask!
We are all busy, but please take the time to ASK
questions and get training.
Ask!
 No question is inconsequential – there are
numerous resources available, including:
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Finance training – Terena Grice X74157
Human Resources X32070
Research Services X36081
eQUIP X32757
Audit Services – Angela Riddell X74701
Audit Services – Kellie Hart X79072
Thank you!