Internal Controls Over Stamp Stock Shipments – Bensalem, PA, Post Office
Background
The OIG used data analytics to identify offices with lost or stolen stamp stock shipments. We identified three expenses totaling $27,429 related to stamp stock shipments for the Bensalem, PA, Post Office and the Croydon Post Office, a small post office whose stamp stock is shipped to the Bensalem Post Office, between May 1, 2016, and April 30, 2017.
Stamp Fulfillment Services (SFS), 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 SFS.
- Enhancements to tracking stamp movement and in-transits at SFS; 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 Bensalem Post Office.
What the OIG Found
Internal controls over stamp stock shipments at the Bensalem Post Office needed improvement. The customer service supervisor (supervisor) did not adequately manage stamp stock limits. To avoid exceeding the office stamp stock limit, the supervisor transferred excess stock to another post office, rather than returning it to the SFS. The supervisor stated that she did not have enough time to return saleable stamp stock to the SFS to avoid exceeding the stamp stock limit.
In addition, although the supervisor maintained detailed records supporting the $27,429 expense at the Bensalem Post Office, the supervisor did not always maintain required stamp stock documentation, including a log with detailed records of expenses at the Croydon Post Office. This occurred because the Postmaster stated he was not aware that he needed to maintain files when the area clears the discrepancy. As a result of our audit, the Postmaster developed a log to track financial differences.
If controls over stamp stock shipments are not followed, there is an increased risk of undetected theft of stamp stock. Further, there is an increased risk the financial records could be misstated and the Postal Service cannot ensure that financial differences are not a result of theft or fraud.
What the OIG Recommended
We recommended management reiterate and periodically monitor the processes for managing stamp stock limits for the Bensalem Post Office.