Internal Controls and Financial Reporting for Executive Boards Eva Rooks, MA Health Services Administrator/Trainer Health Systems Quality Assurance Division.

Internal Controls and

Financial Reportingfor Executive Boards

Eva Rooks, MAHealth Services Administrator/TrainerHealth Systems Quality Assurance DivisionWashington State Department of Health

Executive Boards’ Financial Oversight • Handling money in a secure manner• Helpful policies and procedures to

increase safety• Red flags of financial trouble • Financial reports• Safeguarding financial data • Resources

Handling Money in a Secure MannerChecks: •Unissued checks should be in a secure location•Checks made to “Cash” or “Bearer” should be prohibited•Abbreviated payee names should be prohibited•Voided checks should be cancelled and retained

Handling Money in a Secure MannerChecks: •Restricted endorsements (For Deposit Only) should be placed on all check remittances upon receipt•Follow up on outstanding checks•Supporting documents (invoices) should be marked as paid with the check number when the check is prepared

Bank statements:•Opened and reviewed by the Executive Board•Bank reconciliation should be reviewed, initialed and retained by the Executive Board monthly

Handling Money in a Secure Manner

Bank statements:•Review the bank statement and reconciliation for interbank transfers, missing and voided checks.•Review cancelled checks for authorized signatures, unusual endorsements and alterations.

Handling Money in a Secure Manner

Policies and ProceduresExpenses:•Gas and other expenses should be closely reviewed for irregularities •Non-reimbursed expenses should include parking tickets and moving violations.

Policies and ProceduresProcedures:•Date stamp all incoming mail •Credit card statements should be reconciled like a bank statement, be accompanied by receipts and reviewed by the Executive Board

“Red Flags” – Embezzlement / Fraud • Financial difficulties• Living beyond ones

means• Regularly comes to work

early and leaves late• Works nights and

weekends

• Seldom absent or on vacation

• Comes into the office during days off

• Asks others to hold work while away from the office

Review Reports Sent to DOH • Balance Sheet Prior Year

Comparison• Profit & Loss Prior Year Comparison• Budget Status Report • General Ledger, with bank

reconciliation • Misc. other reports

Safeguarding Financial Data • Backup computer files should be stored

in a location secure from fire and theft• A Washington State Patrol background

check should be obtained on all employees

• Employees with access to cash and other assets should have fidelity bond insurance

Resources • Washington State Ethics Board

Ethics Help Line: 360.664.0781www.ethics.wa.gov

• Your current CPA or accounting firm

Questions?

Questions?