A Performance Audit
An Audit Report on Financial Processes at the Office of the Secretary of State
The Office of the Secretary of State (Office) did not have adequate controls to ensure that revenue was accurately processed and recorded. Specifically, the Office had weaknesses in its revenue processes and reconciliations. These weaknesses significantly affected the reliability of the Office’s revenue data.
The Office had processes and controls to help ensure that it administered purchases and other election-related expenditures in accordance with applicable statutes, rules, and Office policies and procedures. However, the Office should update its purchasing and expenditure policies and procedures to ensure that they align with current processes and to ensure that the Office administers expenditures consistently.
In addition, the Office should address certain weaknesses related to passwords, user access, and change management to help ensure the integrity of its financial data.
The Office Did Not Have Adequate Controls to Ensure That Revenue Was Accurately Processed and Recorded
The Office of the Secretary of State (Office) had weaknesses in its automated processes and manual reconciliations that significantly affected the reliability of its revenue data. Auditors determined that the balance of customer accounts in the Office’s Business Entity Secured Transaction (BEST) system, as of May 31, 2018, was $2.4 million less than the balance recorded in the Office of the Comptroller of Public Accounts’ (Comptroller) Uniform Statewide Accounting System (USAS). The Office had not reconciled that difference as of October 2018. The Office should strengthen its automated processes and manual reconciliations to help ensure revenue is accurately processed and recorded in BEST and USAS.
The Office Should Improve Certain Controls to Help Ensure the Reliability of Its Financial Data; It Also Should Strengthen Its Information Technology Policies and Procedures to Ensure It Complies with Certain Requirements
The Office should strengthen its information technology (IT) controls to address significant security risks that could affect the reliability of data used for reporting financial information. To minimize security risks, auditors communicated details about certain issues directly to the Office’s management in writing.
The Office had adequate controls over purchase expenditures. However, the Office should update its purchasing and expenditure policies and procedures to define and standardize its requirements for documenting the receipt of a purchased good or service.
The Office Had Processes and Related Controls to Help Ensure That It Administered Voter Registration Election Expenditures in Accordance with Requirements
The Office had adequate controls over voter registration election expenditures. However, the Office should strengthen its review process for voter registration election expenditures to ensure reimbursements to counties are accurate and allowable.
The Office Had Processes and Related Controls to Help Ensure That It Administered Primary Election Expenditures in Accordance with Requirements
The Office had processes and related controls to help ensure that it administered primary election expenditures in accordance with requirements. However, the Office should document and implement a policy to retain records of its detailed review and reconciliation of the supporting documentation to ensure that primary election expenditures are accurate and allowable.
Graphics, Media, Supporting documents