Sie sind auf Seite 1von 17

Portsmouth Redevelopment and Housing Authority Internal Control Policy

Title: INTERNAL CONTROLS

Policy: The following statements of general internal control shall apply to all appropriate
functions and operations of the Portsmouth Redevelopment and Housing
Authority.

1) Internal controls are defined by the Portsmouth Redevelopment and Housing Authority as the
plan of organization and the procedures and records that are concerned with the safeguarding
of assets and the reliability of financial records. Internal controls of the Portsmouth
Redevelopment and Housing Authority are designed to accomplish the following:

a) Safeguarding resources against waste, fraud, and inefficiency


b) Promoting accuracy and reliability in accounting and operating data
c) Encouraging and measuring compliance with local agency policy
d) Evaluating the efficiency of financial operations in all departments of the authority.

2) The Portsmouth Redevelopment and Housing Authority shall maintain and periodically review
(at least annually) policies related to personnel, procurement, rentals, collection, fiscal
operations, and investments. All revisions shall be board approved. All policies are submitted
to HUD for review as a part of the five year planning process.

3) The Portsmouth Redevelopment and Housing Authority shall segregate duties to the greatest
extent possible given organization size and staffing levels.

4) All Portsmouth Housing and Redevelopment and Housing Authority checks will be signed in
accordance with a separate Board Resolution identifying individuals authorized to sign.
Currently signers are:

Deputy Executive Director


Director of Budget
Director of Procurement
Director of Finance

5) Checks received via mail, drop slot, site collection, or in person from residents are forwarded
to the accounting department for recording to resident accounts and deposit to banking
accounts. The Accounting Department shall not have access to mail opening functions. Cash
is not accepted by the Portsmouth Redevelopment and Housing Authority.

6) All Portsmouth Redevelopment and Housing Authority sets of books shall adopt a formal
budget each year that will be presented to and approved by the Board of Commissioners by
resolution. If necessary, mid-year budget revisions shall also be Board approved.
7) Portsmouth Redevelopment and Housing Authority Petty Cash
a) Responsibility for petty cash is assigned to the Accounting Manager
b) Petty cash is limited to $350
c) Petty cash is signed for, in ink on a preprinted form, by the person receiving the cash
d) Valid receipts are required for the use of petty cash
e) Petty cash is not to be utilized for check cashing purposes
f) Petty cash must be reconciled by the Accounting Manager prior to replenishment
g) Petty cash lock box shall be stored in a fire-proof secure location as a protection from
misuse and fire

8) Portsmouth Redevelopment and Housing Authority Payroll


a) Personnel records shall be maintained in a locked area with access restricted to those
payroll clerks with human resource responsibilities
b) Executive Director approval is required for both addition to and deletion of names from the
payroll listing
c) Executive Director approval is required for interim changes to salary rates of employees
d) Straight time, overtime, holiday, personal and major medical amounts paid are all reviewed
by the Finance Director prior to preparation of paychecks by Accounting Manager or
designee.
e) Payroll checks are reviewed for accuracy and pay rates by the Director of Finance.
f) Payroll checks are to be distributed by direct deposit only.

Individual policy and procedure statements follow.


Title: CASH RECEIPTS

Policy: Accurate internal control of cash receipts and deposits will be maintained at all
times. Deposits will be made within 24 hours for any amounts received over
$500.00. The Authority will only accept payments in the form of checks or
money orders. No cash payments are accepted.

Purpose: To establish the procedures to be followed for receiving, applying and depositing
cash receipts and for handling cash overages/shortages.

Scope: This procedure applies to all cash receipts received by the Authority.

Procedure:

1.1 RECEIVING AND APPLICATION

1.2 The Accounts Receivable Clerk will receive payments for rent through mail (inter-
office and regular) and via the drop box. The Accounts Receivable Clerk will record all
payments and at the end of the day will total daily cash receipts and count the number
of checks. The Accounts Receivable Clerk will verify the total of the receipts against
the software-generated daily totals.

The Accounts Receivable Clerk or designee will then endorse all checks with the
restrictive endorsement "For Deposit Only" along with the Authority's designated bank
deposit account number. No check should be withheld from daily deposit unless it is
legally imperfect.

1.3 The Deposit Ticket and payments will then be immediately forwarded to the
Accounting Manager for Deposit.

1.4 A copy of the Deposit Ticket and software-generated totals, including printer receipts,
will be forwarded to the Accounting Manager for review.

1.5 The Accounts Receivable Clerk will use the copy of the Deposit Ticket, software-
generated totals, and printer receipts to apply the cash payments to the ledger.

1.6 The Accounts Receivable Clerk is solely responsible for taking and recording payments.
The Accounts Receivable Clerk will have custody of payments from the opening of the
business day to the making of the deposit. When the Accounts Receivable Clerk leaves
the office area, he/she is to leave the payments in a secure space. Other designated
authority personnel are authorized to take payments and to record them.
CASH RECEIPTS
(continued)

2.1 DEPOSIT

2.1 The Accounting Manager will authorize the Accounts Receivable Clerk to release the
deposits to the Courier who will take the prepared bank deposit slip and deposit the
checks with the Authority's authorized bank(s).

2.2 The final net cash deposit must reconcile with the copies provided to the Accounting
Manager.
Title: CASH DISBURSEMENTS CHECK WRITING

Policy: All vendor and expense reimbursement checks shall be produced in a


consistent manner in accordance with both established PRHA Procurement policy guidelines
and all applicable regulations.

Purpose: To outline guidelines for preparation of vendor and expense reimbursement


payments.

Scope: All Non-HCVP HAP payment checks.

Procedure:

1.1 GENERAL CHECK PRPARATION GUIDELINES

1. Expenditures must be supported in conformity with the purchasing, accounts payable,


and travel policies described in this manual.
2. Timing of disbursements should generally be made to take advantage of all early-
payment discounts offered by vendors.
3. Generally, all vendors should be paid in under 30 days after invoice date.
4. Total cash requirements associated with each check run is monitored in conjunction with
available cash balance in bank prior to the release of any checks.
5. Checks are numbered by the Authoritys software system. No manual checks are
permitted.
6. After checks are printed the Director of Finance or designee reviews check all
documentation for accuracy.
7. Checks are printed from blank check stock. All check stock (blank & preprinted) is
stored in a locked cabinet in a secured area in the Finance Department. Only the
Accounting Officers have keys to the locked cabinet.
8. Checks will never be made payable to bearer or cash except in extreme documentable
circumstances (i.e. mass emergency resident relocation)
9. Checks will never be signed prior to being prepared.
10. Upon the presentation of a check, vendor invoices and other supporting documentation
will immediately be filed with the check copy as supporting documentation in order to
prevent subsequent reuse.
2.1 CHECK SIGNING PROCEDURE

Relevant receipts and/or invoices must be attached to all Check Request forms. All
checks other than Housing Choice Voucher Housing Assistance and Utility Assistance
checks require two signatures. Checks printed using the blank check stock are printed by
the computer system (check is signed when the check is printed). No checks will be
signed prior to the check being completed in its entirety (no signing of blank checks).

Check signers should examine all original supporting documentation to ensure that each
item has been properly reviewed prior to signing a check. Checks should not be signed
or issued, if supporting documentation is missing or there are any questions about the
disbursement.

2.2 MAILING OF CHECKS

Accounts Payable checks are copied and returned to the Accounts Payable Specialist to
prepare for mailing. This person separates the checks; checks for employees are
distributed and vendor checks are mailed.

2.3 VOIDED CHECKS AND STOP PAYMENTS

Checks may be voided due to processing errors by making proper notations in the check
register and defacing the check by clearly marking it as VOID. All voided checks
shall be retained to aid in preparation of bank reconciliation.

Stop payment orders are made for checks lost in the mail or other valid reasons. Stop
payments are communicated verbally to the bank by the Director of Finance or their
designee.
Title: BANK ACCOUNT RECONCILIATIONS

Policy: Errors or omissions can be made to the cash records due to the many cash
transactions that occur. Therefore, it is necessary to prove periodically the
balance shown in the general ledger.

Purpose: To outline the procedures for preparation of a monthly bank reconciliation and
recordkeeping of any adjustments.

Scope: This policy statement applies to all bank accounts maintained by the Authority.

Procedure:

1.1 FORMAT

1.2 The Authority's format for monthly bank reconciliations should be a function of the
software utilized to record and maintain transactions within the general ledger cash
accounts.

2.1 PREPARATION AND RECONCILING ITEMS

2.2 Upon receipt of the monthly bank statement including cleared checks, deposit slips and
any other transaction notifications, the monthly bank reconciliation will be prepared by
the staff member assigned to the individual account. The bank reconciliation process
will include visual inspection of each cancelled check as to the payee and proper
signature. Each cancelled check shall be matched to the cash disbursement records to
ensure that payee and amount matches. Periodic review of On-Line Banking Account
information can also be utilized to verify Deposits, Cleared Checks and any other
notifications. All bank reconciliations must be complete by the end of the month
following the date of the bank statement.

2.3 Any discrepancies noted during the automated process of the reconciliation will require
research by the employee responsible for the account to determine the cause and
appropriate adjusting entry. This will also include recalculation of the bank statement
for any possible errors made by the bank.

3.1 ADJUSTMENTS AND JOURNAL ENTRIES

3.2 Any book reconciling items such as recording errors will be summarized and drafted in
journal entry form for recording the general ledger.

3.3 Further, any outstanding checks over six months old will be reviewed for disposition
including write-off by journal entry at the close of the PRHA fiscal year.
Title: TENANT STATEMENTS AND ACCOUNTS RECEIVABLE

Policy: Finance Department is responsible for the timely preparation and distribution of
statements to optimize cash flow and payment promptness by tenants. Finance
Department will also maintain accurate records over accounts receivable and
abide by proper internal controls.

Purpose: To explain the methods for preparation of statements and accounts receivable
records processing.

Scope: This procedure applies to all rents and maintenance charges provided by the
Authority.

Procedure:

1.1 PRINTING AND MAILING OF TENANT STATEMENTS

1.2 All adjustments and charges will be posted to the tenant accounts by close of business
on the 25th day of each month.

1.3 The Accounts Receivable Clerk will print and mail statements to the residents no later
than two business days before the end of each month, where possible.

2.1 CHANGES IN RENT CALCULATION, ADJUSTMENTS, AND REEXAMINATIONS

2.2 Upon completion of the annual reexamination process, changes in rent, or rent
adjustments, the Housing Operations Department will forward a copy of rent adjustment
form to the Finance Director. The Finance Director will approve posting to the tenants
account. Changes in rent should be recorded in the recurring charge area of the
automated accounting system.
Tenant Statements and Accounts Receivable
(continued)

3.1 ACCOUNTS RECEIVABLE

3.2 Accounts Receivable Clerk will receive and process payments from tenants in
accordance with the Cash Receipts procedure.

3.3 A write-off of uncollectible accounts as determined by the Executive Director with Board
of Commissioners approval will be considered on a semi-annual basis. Accounts written
off will be transferred from the accounts receivable ledger to a separate write-off ledger
within the Tenant Accounting software.

3.4 PROCEDURE FOR T.A.R. WRITE-OFF

a. T.A.R.s shall be removed from the financial books, only after the Commissioners
have adopted a resolution to remove the individual accounts.

b. Uncollected Accounts Receivable will be presented to the Board of


Commissioners to write off on a semi-annual basis.

c. The Accounts Receivable Clerk shall receive a list of accounts written off by
the Board of Commissioners, the day following such Board action.

The Accounts Receivable Clerk shall remove these from the financial books
immediately.
Title: PETTY CASH

Policy: Proper internal control will be followed to ensure only valid and authorized use of
petty cash money. Finance Department will maintain accurate records over petty
cash account and abide by proper internal controls. Only small purchases under
$20 may be made through the use of petty cash.

Purpose: To explain the procedure for authorized use of petty cash money.

Scope: This procedure applies to all employees.

1.1 ACCOUNT ESTABLISHMENT

A petty cash account should be established in an amount not to exceed $350.00


to cover small purchases made during a reasonable period (e.g. one month).
Petty cash purchases should be kept to a minimum and should not be used for
repetitive purchases.

2.0 AUTHORIZED USAGE

Petty cash may be used for items such as: reimbursement to employees for the
purchase of goods or services; reimbursement to employees for meals and fees
paid for attending a pre-approved professional association meeting.

Any reimbursements must be approved by the Executive Director or designee


prior to the cost occurrence.

3.0 SECURITY

Access to the account is limited only to the Finance Director and Accounting
Manager. The petty cash envelope is to be held in the safe at all times.

4.0 RECONCILIATION

The petty cash account will be periodically reconciled and replenished by the
Accounting Manager. All receipts are maintained in the petty cash box and are
maintained permanently with accounts payable files.

5.0 AUDIT

The petty cash account is subject to audit by the Finance Director or other
authorized individuals.
Title: CREDIT CARD USAGE

Purpose: The following policy and procedures are adopted in order to enhance the
internal control applicable to the utilization of the Portsmouth
Redevelopment & Housing Authority (the PRHA) credit cards.

Scope: This procedure applies to all staff who in the course of business use credit
cards issued by the PRHA.

Procedure:

1.1 POLICY AND PROCEDURES

A. The issuance of a PRHA credit card to a PRHA employee shall be


authorized in writing by the Executive Director or designee. This credit
card is to be used exclusively for official PRHA business and authorized
expenditures.
B. Authorized expenditures shall include the purchase of goods or services for
only official business of PRHA.
C. Unauthorized expenditures shall include, but not be limited to: personal
expenses of any type; case advances or refunds; alcohol related expenses;
recreation; gifts; damage to personal vehicles or other items; all expenses
related to the personal negligence of the employee (such as fines), and
religiously affiliated items.
D. Prudent judgment is expected when making expenditures with a PRHA
credit card. Expenditures shall be appropriate for official PRHA business
and made in the best interest of PRHA, with consideration of current
economic and budgetary constraints.
E. An original itemized receipt shall be provided for each charge that is
reflected on the credit card statement. Cardholder must submit receipts and
documentation detailing the goods or services purchased, costs, date of the
purchase and the official business explanation thereof.
F. Above said receipts and documentation must be submitted to the Finance
Department in a timely manner to reconcile against the monthly credit card
statement.
G. The cardholder / card user is responsible for its protection and custody and
shall immediately notify their immediate supervisor if the card is lost or
stolen.
H. Since PRHA is sales tax exempt, the cardholder / card user is responsible
for ensuring that sales tax is not charged to the card. Cardholders / card
users must notify vendors or merchants that the credit card transaction
should be exempt from Virginia Sales and Use Taxes (IRS Tax
Identification #54-6001516) if it is used for the purchase of goods or
services in the State of Virginia.
I. Cardholders / card users must immediately surrender the card upon
termination of employment. PRHA reserves the right to withhold final
payroll checks and payout of accrued leave until the card is surrendered.
J. Any employee found guilty of illegal or unauthorized use of a PRHA
credit card may be subject to penalties allowed by law and/or disciplinary
action(s) under the PRHAs Personnel Policies up to and including
termination. The PRHA will investigate and commence, in appropriate
cases, criminal prosecution against any employee found to have misused
the credit card or who violates the provisions of the cardholder
agreement.

1.2 FINANCE DIRECTOR RESPONSIBILITIES

A. Assisting and maintaining record of issuance and retrieval of PRHA credit


cards and overseeing compliance with this policy.
B. Accounting and payment of expenses. All documentation must accompany
invoices before payment is made.
C. Ensuring accuracy of the statement and that activity and account information
is noted on the credit card statement for each line of entry.
D. The balance including interest due under the credit card arrangement shall be
paid for within 30 days of the initial statement date.
E. Compliance with State of Virginia records retention requirements for
safekeeping of statements and receipts for seven years.
1.3 The Executive Director or designee will sign off showing approval for payment.

1.4 All cardholder / card users will refer to and sign off on Attachment A of this document
prior to be issued or using a PRHA credit card.
Title: REVENUE RECOGNITION

Policy: The Portsmouth Redevelopment and Housing Authority will recognize revenue in
accordance with all applicable HUD and programmatic regulations as well as
Generally Accepted Accounting Principles (GAAP).

Purpose: To outline procedure for recognition of revenue.

Scope: This procedure applies to all revenue earned or otherwise received by the Authority.

1.1 CHARGES TO TENANTS, PARTICIPANTS, OR APPLICANTS

These revenues consist primarily of dwelling rental charges and related fees and
charges. Rental revenues are recognized when due while tenant charges and
fees are recognized when the underlying transaction has occurred.

Bad debts are written off bi-annually. These occur in December and June.
Write-off of accounts occurs only on vacated tenant balances where vacancy has
occurred six months (or more) prior to write-off month and internal collection
attempts have been exhausted. See Tenant Statements and Accounts
Receivable policy section 3.4 for procedure for write-offs.

2.0 OPERATING AND CAPITAL GRANTS AND CONTRIBUTIONS

For cost reimbursement-type grants (CFP, CDBG etc.), the revenues are
recognized when the underlying expenses are incurred and as soon as all
eligibility requirements imposed by the provider (HUD, City of Portsmouth, i.e.)
have been met.

For formula-based operating subsidies, the revenues are recognized during the
period for which the subsidy was approved and authorized by the grantor
agency. For fee-based grants, the revenues are recognized when the services are
performed and delivered.

Contributions are recognized as revenue when received, unless accompanied by


restrictions or conditions.

The principal operating grant revenue programs include the operating


subsidies for the Low-Rent Public Housing Program, administrative fees for
the Section 8 housing assistance programs and the non-capital portions of the
capital fund program grants.
COST ALLOCATION

Policy: The Portsmouth Redevelopment and Housing Authority will allocate costs in
accordance with all applicable HUD and programmatic regulations.

Purpose: To define cost allocation methodology.

Scope: This procedure applies to all expenditures recognized by the Authority.

1.1 ALLOCATION OF EXPENSES

In general, with the use of the Central Office Cost Center model there are very few
items allocated.
Currently those items are all salary/benefit related. Our Tenant Selection
(Occupancy Department) and Tenant Accounting staff are allocated on a per unit
basis to applicable sites.

In any case where property managers or other property staff serve more than one
site, salary and benefits are allocated on a per unit basis.
Attachment A

The Employee Verifies:


I am a regular employee of the Portsmouth Redevelopment & Housing Authority
I am approved by the Executive Director of his designee to have a PRHA Credit Card
I agree to read and sign this agreement.
Applicants Initials
______________

PRHA Credit Cardholder Agreement

Requirements for use of a Portsmouth Redevelopment & Housing Authority (PRHA) Credit Card:
You are personally accountable for the following:
a) Only you may use the PRHA Credit Card. The card may not be transferred to, assigned to, or
used by anyone other than the designated Cardholder. PRHA may suspend or cancel your
cardholder privileges at any time for any reason.
b) All purchases must be made by you on behalf of and for the benefit of PRHA.
c) You will protect the PRHA Credit Card from unauthorized use. You are responsible for proper
use of the PRHA Credit Card and recording of the charges, and must retain original receipts to be
submitted to the Finance Department.
d) If the PRHA Credit Card is lost or stolen, you will immediately contact your immediate
supervisor or in their absence, the Executive Director to request the account be closed.
e) You are responsible for following up on erroneous charges, returns, or adjustments and to
ensure proper credit is received on the PRHA Credit Card, including full credit
f) You must abide by PRHAs established Procurement policies and procedures.
g) The credit card is to be used only to make purchases at the request of, and for the legitimate
business benefit of, Portsmouth Redevelopment & Housing Authority.
h) The credit card must be used in accordance with the provisions of the Credit Card Policy
established by the PRHA, as attached hereto.
Violations of these requirements may result in revocation of use privileges. Employees found to
have inappropriately used the credit card will be required to reimburse the PRHA for all costs
associated with such improper use through direct payment or payroll deduction. Disciplinary
action(s) may be taken per the PRHAs Personnel Policies, up to and including termination. The
PRHA will investigate and commence, in appropriate cases, criminal prosecution against any
employee found to have misused the credit card or who violates the provisions of the cardholder
agreement.

Credit Card Account Number: --------------

Name (Please Print)_______________________________________

Signature: _______________________________________________Date:__________

I acknowledge receipt of the attached Credit Card Policy and agree to abide by said Policy.

(Below, For PRHA Use Only)

Credit Card Returned

Authorized Signature: _______________________________________Date:__________