CLERK OF THE CIRCUIT COURT

COURT SERVICES DIVISION

COUNTY CRIMINAL COURT RECORDS

CRIMINAL CUSTOMER SERVICES

OPERATIONS AND INTERNAL CONTROL

REPORT NO. 2000-08

DATED: JUNE 15, 2000

The Clerk of the Circuit Court

Pinellas County, Florida

The Internal Audit Division has completed an operations and internal controls audit of County Criminal Court Records and Criminal Customer Services of the Court Services Division.

PURPOSE

The purpose of this audit was to: 1) review the functions and activities completed in the County Criminal Court Records and Criminal Customer Services located at the Criminal Justice Center, 2) evaluate the effectiveness of management's internal control systems, 3) appraise the completeness and effectiveness of the policies and procedures used to accomplish business objectives, and 4) ascertain the degree of compliance with management's prescribed policies and procedures.

SCOPE

We assessed network administration and LAN security. Certain transactions that occurred between October 1, 1998, through December 31, 1999, were examined. We flowcharted selected activities. Actual policies and procedures that were utilized were compared with management's prescribed policies and procedures. We performed such other audit procedures as we considered necessary in the circumstances.

BACKGROUND

The Court Services Division is an administrative division overseeing the services provided to the courts, as well as the public. In July 1996, the Court Services Division relocated four separate operating departments to the Criminal Justice Center. There was also a change in organizational structure that merged the felony and juvenile departments into one new department called Circuit Criminal Court Records. The Mid-County Traffic Department merged with Misdemeanor Court Records to become the County Criminal Court Records Department. Misdemeanor, ordinances, non-criminal infractions, boating violations, and all traffic and parking cases are processed in County Criminal Court Records. Criminal Customer Services consists of customer services representatives from Felony, Juvenile, Misdemeanor, and Traffic Court Records. Criminal Customer Services is responsible for acceptance of fines and court-imposed payments, witness fee payments, inquiries, research assistance, and receipt of pleadings and documents filed at the counter. Other activities assigned to this department are processing received mail and verifying all payments collected through the parking and traffic lock boxes. The Court Assistance Department is the result of all court clerks, Criminal, Juvenile, and Traffic, being combined in one location for the better utilization of resources.

INTRODUCTION

The results of our review are shown below. They begin with an overall evaluation followed by detailed discussions of the findings and recommendations with management's response.

OVERALL EVALUATION

We have concluded that the functions and activities completed in the County Criminal Court Records and Criminal Customer Services departments are executed with reasonable accuracy. Internal control systems designed by management are generally effective. Policies and procedures were appropriately being revised to align with the organizational structure change and there was substantial compliance with the policies and procedures.

FINDINGS, RECOMMENDATIONS, AND RESPONSES

FINDING 1 - The transaction trail for Traffic Lock Box Payments is not complete.

Sound internal control requires that transactions be traceable from their initiation through all intermediate steps to final reporting. This permits verification of transactions and correction of errors.

We selected a sample of 60 days from the time frame of January 1, 1999, through June 30, 1999, and reviewed the Traffic Lock Box supporting documentation. For five of the selected days, the total dollar amount of the transactions reported processed by the Clerk's Traffic Lock Box Application output reports did not agree to the amount received by the Bank Lock Box processor. In each case, the difference was one item processed as a refund through the Traffic "CT" screen. When a refund is requested in this manner (item not placed in a suspense account first), the transaction is not captured on the Traffic Lock Box reports.

For three out of five of the items noted above, documentation supporting the refund request was filed in the Miscellaneous Refund File, but no information on the transaction was included with the Lock Box daily work package. For the other two items, no supporting documentation for refunds could be located.

We also discovered that written procedures do not require that supporting documentation for refunds be maintained.

FINDING 2 - Lock Box payment deposit amounts are not verified to their respective batch summary reports.

Internal control procedures require that documents are matched that have been prepared and relate to the processing of a transaction or accounting entry in order to determine that the required accounting and operating procedures have been properly executed.

Each time the Traffic Lock Box is processed by the bank, a Batch Summary Report is received. This report depicts the number of batches processed, the number of items processed in each batch, the dollar amount of each batch, and the total dollar amount of all batches processed. A Transmittal Slip is also received reflecting the dollar amount and the composite items of the deposit. The total amount for the deposit on the Batch Summary Report is not compared with the deposit amount on the Transmittal Slip. Comparing the totals would verify that all funds processed were captured and deposited. The same condition exists with Parking Lock Box receipts.

FINDING 3 - The Posted Payment (Code AV) screen of the Traffic Information System is misleading.

The application user documentation should adequately define what information appears on the user screen and the functions available. In addition, the screen name should somewhat agree with its function.

The Posted Payment "AV" screen reflects the funds received from the defendant, not the amount applied to the outstanding fine. It is ambiguous for a screen called "Posted Payments" not to reflect the payment applied to the traffic penalty due. Documentation available for the use of the screen is not adequate to assure that Traffic staff does not misinterpret the information.

FINDING 4 - Some refunds were not docketed.

The Clerk maintains a progress docket for all parking and traffic citations and it is required that refunds related to these citations be entered on the docket. We examined 108 refunds and four of them were not entered on their respective progress docket.

FINDING 5 - Refunds are not verified for their validity.

Sound internal control design requires the person approving transactions to examine supporting documentation to verify if the transaction is valid.

All Fiscal Record Specialists (cashiers) have the ability to process payments related to citations, suspend balances of a citation, and initiate refunds.

When a cashier processes a refund, a "Reason For Payment" form is generated with the recipient's detailed information depicted on it. When the cashier is finished processing all of the refunds, a "Summary Check Authorization" is printed summarizing all the refunds, with a space for the signature of the supervisor approving the refunds. The approving supervisors do not examine the documentation supporting the refunds. This condition fosters an environment that enables a cashier to suspend balances and divert the cash through the refund process. Refunds are processed by Clerk's Accounting; however, they do not test the validity of a refund.

We sampled 108 refunds to determine if they were properly documented. Documentation for four of the refunds could not be located.

FINDING 6 - Compensating controls for the over-the-counter cash receipt process were not functioning properly.

Good internal controls suggest that systems be developed that prevent or detect unauthorized cash disbursements through the refund process.

As noted above, all Fiscal Record Specialists (FRS) have the ability to process payments related to citations, suspend balances of a citation, and initiate refunds.

A cash receipts report is generated that depicts money paid over-the-counter that was applied to parking fines. The report also shows any balances suspended by the cashiers that were related to parking fines. The report is processed by a department that is independent of the cash-collecting function.

The suspended balances on the report were lined through and an investigation of the suspended balances for validity was not required. With this condition existing, an FRS could suspend a part or all of a balance, divert the cash through the refund process, and the diversion could go undetected. Again, neither approving supervisors nor Clerk's Accounting, verify the validity of refunds. Management corrected this condition when we brought it to their attention.

FINDING 7 - Established procedures for FRS transaction corrections were not always followed.

Section 3.21 of the Court and Operational Services Division Policies and Procedures Manual requires that a notation be made by the approver on the register tape directly under the corrected transaction, which notes the receipt number of the valid transaction and identifies the Correction Code.

We tested selected transactions to determine if they were collected, processed, and deposited in accordance with the policies and procedures. Thirteen voids (corrections) were examined and four of them did not have the required notation.

FINDING 8 - Controls should be designed to ensure that every transaction is documented.

A conventional internal control is to verify that validation numbers are continuous from close of the prior business day at the start of the current business day. The start of the day procedures for Fiscal Record Specialists are documented in Chapter 3, Section 3.11 of the Court and Operational Services Division's Policies and Procedures. The policies and procedures are silent on this control; however, we ascertained that employees are instructed to verify that the transaction numbers are continuous from the prior business day.

FINDING 9 - Witness fees paid were not adequately verified.

Good internal control requires an independent verification of clerical operations performed.

Each night, the Supervisor completes a Witness Fee Imprest Fund Reconciliation. The non-reimbursed witness fee total is a cumulative total. The total equals the current day non-reimbursed witness fees plus the non-reimbursed witness fees from the prior days since the last replenishment check was ordered. Checks are ordered approximately every five days. At the end of the day, the supervisor verifies the Witness Fee money that is being returned. The current day's non-reimbursed witness fee total is calculated by subtracting the witness fee money returned from the beginning amount of the Witness Fee cash drawer for each cashier. The Witness Fee Slips, which evidence that witness fees were paid, are accepted as correct without verification.

FINDING 10 - Transfers of parking ticket cases between office locations are not adequately documented.

Prudent management control requires that all records be properly safeguarded until their scheduled time of destruction.

We reviewed 108 parking citations for selected criteria. Two of the citations could not be located. Management agreed that the case files containing the citations had been transferred to the South County Branch.

We visited this branch and learned that seldom are all the tickets sent for a court calendar. We were shown several cases for which there was no accompanying citation. The citations were not located at the conclusion of this audit.

FINDING 11 - Novell access rights were not always in compliance with Management Information System (MIS) and best practice standards.

Our review found the following noncompliance issues.

When we notified management of the conditions, they immediately took corrective action to come into compliance with the standards.

FINDING 12 - Administration of the Local Area Network (LAN) environment is weak.

Our review of the administration function of LAN security found the following weaknesses:

Audit supervised by:

Audit performed by:

Approved:

Karleen F. De Blaker
Clerk of the Circuit Court
Ex Officio County Auditor

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