STATE OF WYOMING

Matthew H. Mead

DEPARTMENT OF AUDIT

Jeffrey C. Vogel

PUBLIC FUNDS DIVISION

Pamela Robinson

(307) 777-7798 Fax (307) 777-5341 [email protected]

Governor

Director

Administrator

October 20, 2016

John Cox, Director Department of Workforce Services 614 South Greeley Highway Cheyenne, WY 82002 Dear Mr. Cox: We are issuing this audit report as required by W.S. 28-1-115(a)(ii)(A). This statute requires every state agency to develop performance measures that provide methods and criteria to measure the agency’s performance in conducting its activities and in achieving its goals and objectives. W.S. 9-21014(a) requires the annual performance report, compiled by the Department of Administration and Information, contain a means of evaluating the outcomes included in the agency’s strategic plan. Objective: The audit objectives were to determine if the Department of Workforce Service’s (DWS) performance measures reported in the annual report were accurate and reliable; identify any potential weaknesses in the agency’s process for managing financial transactions; and determine if the agency understood its role in the information technologies (IT) function. Scope and Methodology: We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. The scope of the audit was from July 1, 2014 to June 30, 2015 including the annual report. We interviewed the Administrative Assistant to the Director, Chief Financial Officer, Deputy Chief Financial Officer, and the IT program coordinator from the Department of Workforce Services. The following lists additional tests performed during the audit. • • •

Traced expenditures from the states accounting system to internal records kept by the Department of Workforce Services Traced revenue receipts to supporting documentation Interviewed key personnel to identify IT practices

HERSCHLER BUILDING, 4th FLOOR WEST ! 122 WEST 25th STREET ! CHEYENNE, WY 82002 ! WEB SITE http://audit.state.wy.us

Department of Workforce Services October 20, 2016

Based on the procedures identified above, there were possible violations of State Statute and a contravention of policies. These violations and additional findings are presented in the following pages of findings and recommendations. This report is intended solely for the use of the specified users listed; however, this report is a matter of public record and its distribution is not limited.

©ª Public Funds

cc:

Governor’s Office Secretary of State

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Department of Workforce Services October 20, 2016

No Performance Measures An annual report was provided; however, the report did not contain performance measures as required by W.S. 28-1-115(a)(ii)(A). Additionally, there was not a four year strategic plan. The four year plan should have specific objectives against which the agency will be measured to evaluate effectiveness during the annual reporting process. These performance measures should provide methods and criteria to measure the agency’s performance in conducting its activities and achieving its goals. Without such measures, decision makers, such as, the Governor, legislators, and the public would not be able to evaluate how the agency is achieving its objectives. Recommendations: Develop a four year strategic plan that contains objectives the agency would like to accomplish. Create performance measures that show progress in achieving those objectives. Decision makers can then evaluate the results of the performance measures in the annual report. Performance measures can be a useful tool for decision makers. They help to evaluate, control, budget, motivate, promote, celebrate, learn, and improve. Once objectives are laid out, performance measures developed, and the four year plan is complete, it must be approved by the Governor. Further, each year, the annual report should be submitted to the Governor and the Legislative Service Office. Fiscal Policy Manual Needs Updated The current accounting policy and procedures manual did not address the current practice of the agency. 11 of 25 revenue and 28 of 35 expenditure transactions contain a stamped authorization. The policy states that all fiscal transactions must contain “live” signatures and dates. In this context, “live” means entered in pen by hand. Additionally, five of 35 expenditure transactions were missing adequate supporting documentation. Policy requires the payment must be supported by original itemized invoices. One of the five transactions identified was a refund and the original document was not attached to the transaction. Recommendations: The accounting policy should be updated to include the use of stamped approvals when the agency deems necessary. Source documents should be included with each transaction. Source documentation is evidence the transactions have, in fact, occurred. Information Technology (IT) Controls Department of Workforce Services (DWS) appears to understand their role in the IT function. DWS and Enterprise Technology Services (ETS) communicate daily regarding support via the agency IT program coordinator. The position requires IT knowledge thus creating a situation where DWS and ETS have effective communication. However, DWS does not have data inventory. Additionally, not all internal policies and procedures are formally written to ensure consistency. Recommendations: Written procedures should be created whenever possible. This recommendation will help create consistency between employees and service delivery. Further, to ensure compliance with the new IT statute, create an inventory and description of all the data required of, collected by, or stored by the agency.

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