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u <br /> Honorable -Mayor--and Members <br /> of the City Council <br /> • City -of St. Anthony <br /> June 30, 1984 <br /> Page 2 <br /> Segregation of Duties <br /> Segregation of duties and responsibilities is an important <br /> element of internal accounting control. When an organization <br /> has few employees involved in certain accounting functions, <br /> however, optimum segregation of duties- is usually impracticable, <br /> but procedural changes which contribute to strengthened controls <br /> are often possible. <br /> One employee presently performs substantially all cash <br /> receipting procedures which includes opening mail, issuing <br /> receipts and preparing the daily deposit. The same person <br /> maintains utility billing records, including individual <br /> customer's receivable balances. As previously recommended, the <br /> mail-opening task should be assigned to another employee, who <br /> a <br /> would restrictively endorse checks received before submitting <br /> them to the individual responsible for preparing and issuing <br /> receipts. <br /> Housing and Redevelopment Authority <br /> Presently, funds of the Housing and Redevelopment Authority of <br /> s the City of St . Anthony (HRA) are comingled with funds of the <br /> a. City. Although the HRA' was established by the City, it is a <br /> separate and independent organization with its own board of <br /> 4 directors. In addition, activities of the HRA are not under the <br /> jurisdiction of the City. Consequently, we recommend the HRA <br /> maintain its own checking account separate from that of the <br /> City. <br /> e • <br />& Inventory <br /> During our observation and test-counts of liquor inventory at <br /> one of the stores we encountered several problems with the <br /> accuracy of recorded inventory. - The problems. were significant <br /> enough that we 'recommended to the liquor manager that certain <br /> sections of the store be recounted; he agreed and the sections <br /> were recounted the following day. To assure- the accuracy of <br /> recorded. inventory counts we recommend the following be <br /> implemented: <br /> n <br /> 1. Prepare and distribute inventory instructions and <br />' procedures to employees involved with counting <br /> and 'recording the inventory. - Arrange a meeting <br /> to review inventory procedures and discuss <br /> l; possible questions, if necessary. <br />