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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Fiscal Management Post-Payment Audit Report Summary
Texas Department of Aging and Disability Services
Fiscal 2010 Fourth Quarter

We audited a sample of Texas Department of Aging and Disability Services' (Department) payroll, purchase, travel, payment card, grant and refund of revenue transactions that processed through USAS and the standardized payroll/personnel system (SPRS) during the period beginning September 1, 2008 through August 31, 2009.

We reviewed payroll transactions for compliance with the GAA, the Payroll Guide, and other pertinent statutes. We identified four instances where lump sum payments for accrued vacation time were calculated incorrectly. The state effective service dates for 12 employee records were incorrect. Five other payroll transactions did not have the documentation needed to verify the validity of the payment.

We reviewed purchase and payment card transactions for compliance with the GAA, Purchase Guide, Procurement Manual, and other pertinent statutes. Many documents reviewed were missing the documentation necessary to determine if the payments were valid. We noted five instances in which charges were paid for but not included on the PO. We noted two documents in which the amount stated on the invoices was greater than the amount stated on the contracts, one transaction in which the Department improperly paid taxes to a vendor and one transaction purchased items which are available from Texas Industries for Blind and Handicapped (TIBH). In our payment card sample, we identified several instances of term contract not utilized, control weakness over received goods, and best value not received.

We reviewed the Department's compliance with the prompt payment law and scheduling rule. Eleven purchase transactions and one payment card transaction were not properly scheduled resulting in a projection of interest lost to the state treasury of $7,659.89. In addition, the Department did not pay interest on three purchase transactions, ten travel transactions, and five payment card transactions. These transactions resulted in a projection of interest not paid of $5,067.93. The Department also overpaid prompt payment interest on one purchase transaction, resulting in a projection of $1,466.23.

We reviewed travel transactions for compliance with the GAA, Textravel, and other pertinent statutes. We identified three travel reimbursements for mileage where the incorrect number of miles was reimbursed to employees. We identified many travel reimbursements for mileage where the incorrect number of miles was reimbursed to employees due to a system rounding error. During our audit review, we were unable to verify that the reconciliation of a payment to the Department's central billing account was correct.

We conducted a limited review of the Department's transactions relating to grant payments. This review consisted of verifying that the payments did not exceed the authorized amounts. We did not identify any errors in the payments reviewed. The review of these payments did not include an investigation of the Department's procedures for awarding the grants or monitoring payments made to grantees; therefore, we are not offering an opinion on those procedures.

Our audit included a limited review of the Department's transactions relating to refunds of revenue. These reviews consisted of verifying that the documentation provided reconciled with the payment amount in our sample. We did not identify any payment or documentation errors in these transactions.

We also conducted a security review that entailed identifying any of the Department's employees with security in USAS or SPRS or on the voucher signature cards, who terminated employment or whose security had been revoked. Upon termination or revocation, the Department must observe certain deadlines to revoke security. The Department failed to ensure that the Comptroller's office received notification in a timely manner about the termination of two employees listed on the Department's signature cards.

We selected a limited number of fixed assets acquired by expenditures during our audit period to test for accurate reporting in SPA and to verify existence of the assets. We were able to locate all assets and verify accurate tracking in SPA. The Department reported 30 assets as missing and three assets as stolen during the audit period.

All state agencies have been requested to evaluate current benefit replacement pay (BRP) indicators for accuracy. Incorrect indicators could cause employees to be either over or underpaid for each monthly salary payment depending on leveling choices. Various reports were provided to the Department to assist in this process. During a review of the BRP Indicator Evaluation Report for May 1, 1995 for through June 21, 2010 that was run on June 21, 2010, we noted that the Department was not current in its correction of invalid BRP indicators. We noted that the Department had 33 terminated and active employees with deficient BRP indicators because no action was taken to make the corrections. The Department must research and correct all BRP indicators for its employees.

We issued a prior post-payment audit of the Department's payroll, purchase, travel, payment card, grant and refund of revenue transactions on May 31, 2006. A comparison of the error rates shows an increase in the error rate in the current audit. Several findings from the previous audit were also identified in the current audit. The recurring findings were: incorrect lump sum payment, incorrect longevity payment, incorrect amount paid, charges paid that were not on PO, missing documentation, prompt payment and scheduling issues, and employees retaining security to expend funds after termination.

Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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