Single Audit Report Fiscal Year Ended June 30, 2012 - State ...

State of GeorgiaAuditee’s Corrective Action PlansFor the Fiscal Year Ended June 30, 20123. Follow-up compliance monitoring is performed as needed by the PTC and Planners based on the initial riskassessment.Contact Person: Carol L. ComerTelephone: 404-347-0573 Fax: 404-631-1937 E-mail: ccomer@dot.ga.govFinding Control Number: FS-484-12-01EXPENSES/ EXPENDITURES AND LIABILITIESDeficiencies in Project Closeout ProceduresThe GDOT concurs that additional policies and procedures should be developed and implemented that require projectmanagers to monitor projects and initiate closeout procedures to ensure they are closed timely. The GDOT conductedvarious meetings with project management, procurement and finance staff to discuss this issue during FY 2012 and iscurrently reviewing a draft policy and procedure to provide direction to project managers on closeout responsibilities.The Division of Finance follows the policies and procedures listed below to assist with monitoring projects nearingcompletion and identify inactive purchase orders to be closed.1. The GDOT implemented the Closing State Projects procedure (10-7) in September 2010 which provides direction tothe Federal Integrity Review and Evaluation (FIRE) Unit on closing out all state projects.2. The GDOT implemented the Federal Project Close-Out Procedures (10-6) in October 2010 which provides directionto the FIRE Unit on closing out federal projects in accordance with the Federal Highway Administration guidelinesas final statements are received.3. The GDOT implemented the Monitoring Inactive Purchase Orders policy (7110-15) and procedure (1-36) in May2011 which provides direction to the Project Accounting Unit on generating queries from PeopleSoft to identifypotential obsolete purchase orders. Since the development of these queries, significant progress has been made inidentifying obsolete purchase orders. The GDOT paid out, cancelled or closed 1,782 purchase orders in FY 2012.In addition, the Project Accounting Unit initiated a new practice in October 2012 requiring the contract expiration date berecorded in the purchase order reference field when setting up new purchase orders. The field will be used to identify expiredcontracts so the purchase order can be closed timely. The GDOT’s Creating Contract Purchase Orders procedure (25-2) willbe revised to include this process.The Project Accounting Unit also researches open purchase orders to see if the purchase order file contains an invoicemarked “final” in accordance with contract requirements or a standard release letter. If the file contains a final paymentinvoice or a standard release letter, documentation is sent to the Contracts Payable Unit to close the purchase order. If nopayment has been made within the last year and the file does not contain a final payment invoice or a standard release letter,the Project Accounting Unit contacts the project manager to determine the status of the purchase order and if it can be closed.If the project manager indicates the purchase order may be closed, documentation is sent to the Contracts Payable Unit toclose the purchase order.Contact Person: Connie SteeleTelephone: 404-347-0471 Fax: 404-347-0590 E-mail: csteele@dot.ga.govFinding Control Number: FS-484-12-02EXPENSES/ EXPENDITURES AND LIABILITIESInternal Control Deficiencies Over Contractual ObligationsThe GDOT concurs that there may be instances where contracts are not recorded within 60 days or instances when a contractis inadvertently not recorded by year end due to the volume of purchase orders processed by the GDOT annually. TheGDOT recorded or modified over 8,000 purchase orders during FY 2012. The GDOT realizes the importance of recordingobligations on the general ledger in a timely manner to ensure that liabilities are recognized as soon as they are incurred andmakes every effort to do so. The GDOT implemented the following policies and procedures prior to FY 2012 year end closeand has continued these practices to ensure all obligations are recorded by the close of the fiscal year:332