Internal Controls Over Financial Differences – Cardiss Collins Postal Store, Chicago, IL
Background
The U.S. Postal Service Office of Inspector General (OIG) uses risk models to identify financial anomalies. Risk models are analytic tools that look at specific behaviors and patterns that are strong indicators of improper activity.
The OIG’s Field Financial Risk Model identified the Cardiss Collins Postal Store in Chicago, IL, as having the highest value of financial differences in the Chicago District from April 1, 2016, to June 30, 2016.
Financial differences are variances in financial activities that occur at postal retail units. Differences include variances between banking deposits and receipts, errors with transmitted sales and money order data, and stock shipments not received by the unit. The value of the differences is expensed to the unit.
A manager or designee must identify the cause of the differences, adjust the financial records, maintain detailed records, and ensure the differences are resolved timely. A reason must be annotated for any unresolved differences.
The objective of this audit was to determine if financial differences identified at the Cardiss Collins Postal Store were properly researched and resolved.
What the OIG Found
Financial differences identified at the Cardiss Collins Postal Store were not always properly researched and resolved. We reviewed 91 financial differences and found 24 did not have adequately detailed records of research and were not resolved as of November 7, 2016.
The customer service supervisor responsible for overseeing the process set an internal requirement of 30 days to resolve differences for the unit. However, she stopped monitoring differences that remained unresolved after 30 days and only addressed the most current differences. She stated she had competing priorities and was unable to focus on all financial differences.
If the Postal Service does not properly research and resolve financial differences, then misconduct, theft, or fraud may go undetected. In addition, unresolved financial differences impact the Postal Service’s ability to report accurate financial records.
What the OIG Recommended
We recommended management research and resolve outstanding financial differences and implement controls to ensure continuous monitoring and timely resolution.