The OIG used data analytics to identify offices with lost or stolen stamp stock shipments. We identified expenses regarding stamp stock shipments for the Rosemeade Station in Carrollton, TX, and Rosemeade Station mobile Point-of-Sale (mPOS) between May 1, 2016, and April 30, 2017.
Stamp Fulfillment Services in Kansas City, MO, fulfills stamp orders from postal retail units. Retail units are responsible for identifying and locating missing stamp stock shipments. When retail units do not resolve discrepancies timely, Accounting Services records an expense to the units for the difference.
Management advised they are strengthening overall stamp accountability and upgrading financial controls, including:
- Daily financial accountability reconciliations and semi-annual stamp counts at Stamp Fulfillment Services.
- Enhancements to tracking stamp movement and in-transits at Stamp Fulfillment Services; and stamp shipments to individual post offices.
- New tracking process and centralized review of all missing stamp stock shipments, including orders sent to the wrong unit.
- New stamp destruction process that better aligns and tracks inventory discrepancies.
The objective of this audit was to determine whether internal controls over stamp stock shipments were in place and effective at the Rosemeade Station.
What the OIG Found
Internal controls over stamp stock shipments at the Rosemeade Station, although established, were not always effective and needed improvement. Specifically:
- The unit did not always adequately secure stock shipments in a locked drawer or cabinet upon arrival into the unit.
- Personnel did not always properly receive stamp stock shipments or transfer stamp stock: A witness was not present when receiving stock and personnel did not always complete or sign and date required receipt forms. Further, the unit did not always transfer stock to the mPOS accountability to align with sales from the mPOS device.
- The unit did not maintain all required stamp stock documentation, such as Postal Service Forms 17, Stamp Requisition/Stamp Return, or system-generated shipment received receipts.
- Thirty-three stamp stock discrepancies were not researched and resolved.
The Customer Service supervisor stated he was unaware of automatic stamp stock shipments until notification from Accounting Services that stamps were sent to the unit. Further, he stated that when they received the mPOS device, they were not aware of the procedures or that the mPOS had its own accountability. When they received guidance, they had already established procedures on their own and did not refer to its requirements. Finally, the Customer Service supervisor stated that he was unaware of the requirement to resolve financial differences.
If controls over stamp stock shipments are not followed, there is an increased risk of undetected theft of stamp stock and that financial records could be misstated.
What the OIG Recommended
We recommended district management instruct the unit manager to notify the Customer Service supervisor of all arriving stamp stock shipments. We also recommended management reiterate and enforce policies for securing, receiving, and transferring stamp stock; segregating duties; maintaining required documentation; and resolving financial differences.