TIME AND ATTENDANCE AUDIT FOR SIX MONTHS ENDED December 31, 2010

Transcription

1 TIME AND ATTENDANCE AUDIT FOR SIX MONTHS ENDED December 31, 2010 Executive Office Finance College and Career Readiness Departmental Support Innovations INTERNAL AUDIT REPORT Audit Control Number: TA 2-10 December 1, 2011 Issued: December 15, 2011 LOUISIANA DEPARTMENT OF EDUCATION BUREAU OF INTERNAL AUDIT Baton Rouge, LA NOTICE

2 STATE OF LOUISIANA DEPARTMENT OF EDUCATION POST OFFICE BOX / BATON ROUGE, LOUISIANA Toll Free #: December 15, 2011 Board of Elementary and Secondary Education Mrs. Ollie Tyler, Acting Superintendent of Education Louisiana Department of Education The Bureau of Internal Audit (BIA) completed a semiannual audit of the State Department of Education s (SDE) time and attendance records for the period ended December 31, 2010 as part of our ongoing responsibilities. The scope of this project included the following: Reviewing SDE automated time and attendance procedures, Reviewing Department of State Civil Service payroll rules and procedures, Examining fixed time entry sheets and supporting documentation, Examining fixed time entry reports, and Testing all active employees in each unit of the selected SDE offices. Our objectives included determining if: time and attendance records are maintained timely and properly, overtime, leave, and prior period adjustments are properly administered and recorded, restricted appointment, student, and hourly employees are reported and paid properly, management has complied with requirements of Office of Management and Budget Circular A-87, terminations and resignations are properly and timely recorded, and management is properly reviewing time and attendance documents. The attached report contains conclusions regarding overall performance of the Offices, as well as specific observations noted within each Office. Management s responses and action plans to address the observations are included in Enclosures contained herein. The nature of these observations indicates the need for management to establish and preserve certain internal controls to ensure time and attendance records are maintained properly on a daily basis and in accordance with state and federal laws and regulations. In addition, management must ensure employees, supervisors, and timekeepers are following all procedures outlined in the Employees Policies and Procedures related to payroll time and attendance. Respectfully submitted, DJGJr/nrl Distribution: Dudley J. Garidel, Jr. Director of Internal Audit Board of Elementary and Secondary Education (11) Ollie Tyler, Acting Superintendent Sharon Southall, Executive Management Officer Beth Scioneaux, Finance Rayne Martin, Innovations Leslie Jewel, Appropriation Control, Division Director Debbie Schum, College and Career Readiness Catherine Pozniak, Executive Director, BESE Office of the State Inspector General Office of the Legislative Auditor An Equal Opportunity Employer

3 TABLE OF CONTENTS EXECUTIVE SUMMARY... 1 AUDIT RESULTS & RECOMMENDATIONS (with Management s Response)... 2 SPECIAL REVIEW OF RE-ORGANINZATIONAL UNIT/INNOVAITONS AUDIT SCOPE AND OBJECTIVES MANAGEMENT S FORMAL RESPONSE... ENCLOSURES 1-8

4 Audit Project #TA 2-10 December 15, 2011 Page 1 EXECUTIVE SUMMARY Time and attendance audits are conducted semiannually as of June 30 and December 31. For each semiannual period, time and attendance procedures for one-half of the State Department of Education (SDE) Offices are examined to provide coverage to the entire SDE annually. This particular audit, therefore, included the following offices: Executive Office Finance College and Career Readiness Departmental Support Innovations Each employee and supervisor within each office was tested individually against forty (40) criteria based on federal and state laws and regulations, as well as SDE policies and procedures. In addition, timekeepers were tested for compliance with job responsibilities including safeguarding time records and accurate data entry. The following is a summary of unit scores within each office: Office Exemplary Satisfactory Needs Improvement Unsatisfactory Executive office 0% 100% 0% 0% Finance 0% 100% 0% 0% College and Career Readiness 25% 75% 0% 0% Innovations 20% 80% 0% 0% Departmental Support 30% 70% 0% 0% Overall, the following were areas of concern noted during the audit: Payroll documentation does not present a clear, easily understandable record of all hours worked and leave taken by staff. Scratch-outs/corrections are not initialed by the employee. Leave slips are not electronically/manually submitted and approved for leave taken. Timesheets do not match leave slip information reported on payroll reports. Management using incorrect timesheets to record time and attendance. Management not signing and dating timesheets for employees. Inconsistencies of payroll documentation and card readers for building.

5 Audit Project #TA 2-10 December 15, 2011 Page 2 AUDIT RESULTS Executive Office The Office of the Deputy Superintendent is under the direction of Sharon Southall, Executive Management Officer, for time and attendance purposes and administration and consisted of a total of 34 employees tested over two (2) pay periods. Pay Period Units included in this audit: Supervisor(s) Deputy Undersecretary Ollie Tyler Governmental Affairs Paul Pastorek Joan Hunt August 23, 2010 Legal James Hrdlicka September 5, 2010 Rene Greer Public Affairs Ileana Ledet Ollie Tyler Deputy Undersecretary Ollie Tyler Governmental Affairs Paul Pastorek October 18, 2010 October 31, 2010 Legal Public Affairs The following observations were noted during testing: Deputy Undersecretary Joan Hunt Jim Hrdlicka Rene Greer Ileana Ledet Ollie Tyler 2 instances of timekeepers not insuring all information is correct on employee timesheet (Supervisor Ollie Tyler) 1 instance of timesheet not maintained on a daily basis. (Supervisor Ollie Tyler) 1 instance payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. (Supervisor Ollie Tyler) 5 instances of incomplete timesheet. (Supervisor Ollie Tyler) Governmental Affairs 16 instances of timekeepers not insuring all information is correct on employee timesheet (Supervisor Paul Pastorek) 10 instances of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. (Supervisor Paul Pastorek) 17 instances of student coding not documented on timesheet. (Supervisor Paul Pastorek)

6 Audit Project #TA 2-10 December 15, 2011 Page 3 Public Affairs 2 instances of employee corrections not corrected properly. (Supervisor Rene Greer) 10 instances of timesheets default costing not being filled out on timesheet. (Supervisor Rene Greer) 5 instances of incomplete timesheet. (Supervisor Rene Greer) 2 instances payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. (Supervisor Rene Greer) 1 instance of overtime not accurately recorded on time sheet. (Supervisor Rene Greer) 1 instance of timesheets not maintained on a daily basis. (Supervisor Rene Greer) Legal Services 2 instances of employee corrections not corrected properly. (Supervisor Joan Hunt) 1 instance of employee not having prior approval for Leave without Pay. (Supervisor James Hrdlicka) 1 instance of payroll documentation not matching payroll reports for Overtime. (Supervisor James Hrdlicka) 1 instance of management payroll records not completed within the 30 days allotted for completion. (Supervisor James Hrdlicka) Audit Risks & Impact: The observations noted above increase risk for the SDE in the following manner if not addressed and corrected by management: Incorrect pay to employees Unauthorized overtime and/or leave Noncompliance with Civil Service Payroll Rules and Regulations and other existing labor laws Recommendation: The Bureau of Internal Audit recommends management correct timesheets, leave slips, and associated backup documentation where appropriate; compile and implement a management action plan addressing each of the observations to prevent and detect future reoccurrences; and ensure all supervisors and staff comply with federal and state laws and regulations, as well as SDE policies and procedures Management Response: Management concurs with observations and will implement corrections immediately.

7 Audit Project #TA 2-10 December 15, 2011 Page 4 Finance The Finance is under the direction of Beth Scioneaux, Deputy Superintendent for Management and Finance and consists of a total of 81 employees tested over two (2) pay periods. Pay Period Units included in this audit: Supervisor(s) August 23, 2010 September 5, 2010 Appropriation Control Chief Educational Finance Human Resources Leslie Jewell Mark Ott Jane Sledge Patti Wallace Beth Scioneaux Carlos Dickerson Toni Gordon Priscilla Williams Tracy Garcia Charlotte Stevens Marelle Houghton Isabelle Olivier Nakia Jason KimbraLamonte Mary Calivier Laura Lapeza Rashaunda Matthews Paula Matherne Michele Staggs Ruth Aron Monita Reed October 18, 2010 October 31, 2010 Appropriation Control Chief Educational Finance Human Resources Leslie Jewell Mark Ott Jane Sledge Patti Wallace Carlos Dickerson Toni Gordon Priscilla Williams Tracy Garcia Beth Scioneaux Charlotte Stevens Marelle Houghton Isabelle Olivier Nakia Jason KimbraLamonte Mary Calivier Laura Lapeza Rashaunda Matthews Paula Matherne Michele Staggs Beth Scioneaux Ruth Aron Monita Reed

8 Audit Project #TA 2-10 December 15, 2011 Page 5 The following observations were noted, during testing: Management and Finance 3 instances of timekeepers not insuring all information is correct on employee timesheet 45 instances of improperly correcting errors on timesheets Management does not concur Additional comments: Management response states Human Resources Timesheet Quick Tips Guide does not require, recommend, or even suggest corrections may only be made by drawing one line through the error; however Human Resources Timesheet Quick Tips Guide, on the employee intranet, states, as of November 8, 2011, in the Do s and Don ts section: DON T scratch thru an error but line thru and initial. In addition the Bureau of Internal Audit has given trainings along with Human Resources in which the information for making a correction on timesheet was given and this Quick Tips reference Guide was cited as being a source for compliance to making these corrections. 3 instances of employee not completing timesheets. 68 instances of timesheets default costing not being filled out on timesheet. Management does not concur Additional comments: Managements states uniformity as the basis for the response, however; due to inconsistencies noted in testing in which most employees fill out default costing while other do not. Bureau of Internal Audit recommends consistency within a division completing timesheets. 17 instances of timesheet not maintained on a daily basis. Management does not concur Additional comments: Managements states uniformity as the basis for the response; however, due to inconsistencies noted in testing in which most employees fill out default costing while others do not, the division is not consistent in completing timesheets. Bureau of Internal Audit recommends consistency within a division completing timesheets.

9 Audit Project #TA 2-10 December 15, 2011 Page 6 Management and Finance cont d Audit Risks & Impact: 1 instance of employee not recording coding on timesheet. (Supervisor Charlotte Stevens) Management does not concur Additional comments: Managements states due to the employee working on a Sunday, coding was not necessary: however, the type of coding is essential due to determining paid overtime or compensatory time being awarded. Timesheets clearly state amount of overtime and type. Bureau of Internal Audit recommends consistency within a division in completing timesheets. 1 instance of employee with improper coding. ( Supervisor Leslie Jewell) Management does not concur Additional comments: Management states the supervisor, employee, and time administrator understood the picture of all hours worked; however, coding should be readily apparent to anyone who reviews the timesheets which was not the case in instance because there was no coding on the timesheet. 1 instance of employee not submitting timesheet. (Supervisor Michelle Staggs) 1 instance of employee not signing and dating at the end of pay period. (Supervisor Michelle Staggs) The observations noted above increase risk for the SDE in the following manner if not addressed and corrected by management: Recommendation: Civil liability and penalties for noncompliance with the FLSA Questioned costs - Federal grants Incorrect charge of leave to employee Incorrect pay to employees Noncompliance with Civil Service Payroll Rules and Regulations and other existing labor laws The Bureau of Internal Audit recommends management correct timesheets, leave slips, and associated backup documentation where appropriate; compile and implement a management action plan addressing each of the observations to prevent and detect future reoccurrences; and ensure all supervisors and staff comply with federal and state laws and regulations, as well as SDE policies and procedures

10 Audit Project #TA 2-10 December 15, 2011 Page 7 Departmental Support The Departmental Support is under the direction of Donna Nola-Ganey, Assistant Superintendent and consists of approximately 172 employees tested over two (2) pay periods. NOTE: The number of employees tested was less than the actual number of active employees due to some missing timesheets for the pay periods tested. Pay Period Unit Supervisor(s) Accountability Scott Norton Ancillary Nancy Beben Jacqueline Bobbett Assessment & Accountability Scott Norton Assessment Administration Bernadette Morris Assessment Development Scott Norton Claudia Davis Assessment Research & Technology Fen Chou Curriculum Standards-Administration Scott Norton Donna Nola-Ganey Division of Nutrition Support John Dupre Judy Stracener EMS Standards Susannah Craig Federal Programs Resolution Support Linda Tindall Federal Programs Support Donna Nola-Ganey IDEA Support Services Bernell Cook Kathy Wisnser James McMahon Ross Poret Mark Nichols August 23, 2010 September 5, 2010 Mary Borne Dave Elder Information Management Seven Marangos Wendy Williams Paula McDonner Mary Fife Teresa Waldrop Elvis Willie Karen Burke Laura Boudreaux NCLB & IDEA Support Bernell Cook Donna Nola-Ganey NCLB Support Services Latikka Magee- Brumfield Parental Options Erin Bendily Robert Schaff Michael Coburn Student & School Support Terry Simoneaux Kartina Roberts Tasha Anthony Tavia Crumpler Monitoring Services Janet Langlois

11 Audit Project #TA 2-10 December 15, 2011 Page 8 Pay Period Unit Supervisor(s) Ellen Spears Planning & Reporting Services Evelyn Johnson Standards, Assessment & Accountability Scott Norton Accountability Scott Norton Ancillary Nancy Beben Jacqueline Bobbett Assessment & Accountability Scott Norton Assessment Administration Bernadette Morris Assessment Development Scott Norton Claudia Davis Assessment Research & Technology Fen Chou Curriculum Standards-Administration Scott Norton Division of Nutrition Support Donna Nola-Ganey John Dupre Judy Stracener EMS Standards Susannah Craig Federal Programs Resolution Support Linda Tindall Federal Programs Support Donna Nola-Ganey IDEA Support Services Bernell Cook Kathy Wisnser James McMahon Ross Poret Mark Nichols Mary Borne Dave Elder October 18, 2010 Seven Marangos October 31, 2010 Information Management Wendy Williams Paula McDonner Mary Fife Teresa Waldrop Elvis Willie Karen Burke Laura Boudreaux NCLB & IDEA Support Bernell Cook Donna Nola-Ganey NCLB Support Services Latikka Magee- Brumfield Parental Options Erin Bendily Robert Schaff Michael Coburn Student & School Support Terry Simoneaux Kartina Roberts Tasha Anthony Tavia Crumpler Monitoring Services Janet Langlois Ellen Spears Planning & Reporting Services Evelyn Johnson Standards, Assessment & Accountability Scott Norton

12 Audit Project #TA 2-10 December 15, 2011 Page 9 In addition, the following observations were noted during testing: Accountability 1 instance of employee corrections not corrected properly (Supervisor Scott Norton) 1 instance of timesheets default costing not filled out on timesheet (Supervisor Scott Norton) Ancillary Resources 2 instances of corrections not being initialed by employee (Supervisor Jacqueline Bobbett) 1 instance of timesheet not maintained on a daily basis (Supervisor Jacqueline Bobbett) Assessment & Accountability 1 instance of employee corrections not corrected properly(supervisor Scott Norton) 2 instances of timekeepers not insuring all information is correct on employee timesheet (Supervisor Scott Norton) 2 instances of students working more than the 20 hrs allotted without prior written approval by appointing authority. (Supervisor Scott Norton) 1 instance of timesheet not maintained on a daily basis (Supervisor Scott Norton) Assessment Administration 5 instances of corrections not initialed by employee (Supervisor Bernadette Morris) 1 instance of proper supervisory approval not noted for Leave without Pay. (Supervisor Bernadette Morris) Assessment Development 3 instances of corrections not being initialed by employee (Supervisor Scott Norton) 1 instance of timesheet and ZT02 report inconsistent. (Supervisor Scott Norton) 2 instances of timesheets default costing not being filled out on timesheet (Supervisor Scott Norton) Additional comments: Managements states uniformity as the basis for the response; however, due to inconsistencies noted in testing in which most employees fill out default costing while others do not, the division is not consistent in completing timesheets. Bureau of Internal Audit recommends consistency within a division completing timesheets. 1 instance of proper supervisory approval not noted for Leave without Pay. (Supervisor Claudia Davis) 1 instance of incorrect recording of timesheet. (Supervisor - Claudia Davis) Assessment Research & Technology 3 instances of corrections not initialed by employee (Supervisor Fen Chou)

13 Audit Project #TA 2-10 December 15, 2011 Page 10 2 instances of timesheet and ZT02 report inconsistent. (Supervisor Fen Chou) 1 instance of Non-exempt employee not signing out for lunch. (Supervisor Fen Chou) Management does not concur Additional comments: Management states compensatory time is not owed to this employee due to the fact employee was relieved of duties during his/her lunch break and had neglected to sign out. Fair Labor Standards Act (FLSA) regulations state: Non-exempt employees must sign in upon arrival, departure and in/out from lunch each day. Due to employee not signing in/out for lunch it is undetermined whether employee is owed compensatory time according to the rule and regulations set forth within FLSA. Curriculum Standards 1 instance of timesheets default costing not filled out on timesheet (Supervisor Scott Norton) Elementary/Middle/Secondary Standards 1 instance of employee corrections not corrected properly(supervisor Susannah Craig) Division of Nutrition Support Division using unapproved timesheets for all employees. (Supervisor John Dupre) Management does not concur Additional comments: Management states s from Human Resources as approval for using this timesheet. Bureau of Internal Audit review of indicates does not give approval for this timesheet to be used but, rather the Human Resource Director liked it and would have used it in lieu of, than the current one in use by LDOE employees. EP 3.2 states clearly: the same standard timesheet will be used by all employees, except those exempt from completing timesheets, whether the employee has A-87 reporting requirements or not. 8 instances of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. (Supervisor Judy Stracener) Management does not concur Additional comments: Management stated they will take corrective action to assist in clarifying timesheets. Bureau of Internal Audit believes due to unauthorized timesheets being used in this division, the coding was unclear. EP 3.2 states: the same standard timesheet will be used by all employees, except those exempt from completing timesheets, whether the employee has A-87 reporting requirements or not.

14 Audit Project #TA 2-10 December 15, 2011 Page 11 Division of Nutrition Support cont d 1 instance of timesheet and ZT02 report inconsistencies. (Supervisor Judy Stracener) 2 instances of student working more than 20 hours without prior written approval by Appointing Authority. (Supervisor John Dupre) Management does not concur Additional comments: Management states Position Action Request form as approval. EP However, this was not included with the requested supporting documentation for the six month audit; therefore, the BIA was not able to review the documentation during the audit. Federal Programs 1 instance of employee corrections not corrected properly. (Supervisor Donna Nola- Ganey) Federal Programs Resolution Support 1 instance of employee corrections not corrected properly. (Supervisor Linda Tindall) 1 instance of timesheet and ZT02 report inconsistencies. (Supervisor Linda Tindall) IDEA Support Services 1 instance of employee corrections not corrected properly. (Supervisor Bernell Cook) Information Management 42 instances of employee corrections not corrected properly. (Supervisors James Wilson. Elvis Willie, Rajeswari Mani, Mary Fife, Teresa Waldrop, Steven Maragos, James McMahon, Paula McDonner, Wendy Williams, Dave Elder, Ross Poret, Mary Borne, Laura Boudreaux) 7 instances of timesheets not maintained on a daily basis (Supervisor Laura Boudreaux, Dave Elder, Mary Fife, James McMahon, Kathy Wisner, Ross Poret) 5 instances of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. 1 instance of employee corrections not corrected properly. (Supervisors Mary Fife, James McMahon, Teresa Waldrop) 1 instance of employee s signature and date not recorded at the end of the pay period (Supervisor Mary Fife) 1 instance of overtime hours not accurately recorded on timesheet (Supervisor- Elvis Willis) 13 instances of default costing not filled out on timesheet (Supervisor Elvis Willis, Mary Fife, James McMahon, Ross Poret, Laura Boudreaux, Mark Nichols, Dave Elder, ) 2 instances of timesheet and ZT02 report inconsistencies (Supervisor - Mary Fife, Kathy Wisner)

15 Audit Project #TA 2-10 December 15, 2011 Page 12 Information Management cont d 1 instance of original management signature and date was not on timesheet (Supervisor Karen Burke) 1 instance of student working more than 20 hours without prior written approval by Appointing Authority (Supervisor - Wendy Williams) NCLB &IDEA Support 1 instance of timesheets not maintained on a daily basis (Supervisor Bernell Cook) 1 instance of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken. (Supervisor Bernell Cook) 1 instance employee scheduled hours not documented on timesheet (Supervisor Walter Atterberry, Valerie Triggs, Janet Langlois) 2 instances of default costing not filled out on timesheet (Supervisor Donna Nola- Ganey, Bernell Cook) NCLB Support Services 1 instance of default costing not filled out on timesheet not being maintained on a daily basis (Supervisor Latikka Magee-Brumfield) Parental Options 1 instance of timesheets not maintained on a daily basis (Supervisor Erin Bendily) 1 instance of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken (Supervisor- Erin Bendily) 1 instance of employee corrections not corrected properly (Supervisor Erin Bendily) Management does not concur Additional comments: Management response states due to the time being identifiable they do not concur with this finding; however, Human Resources Timesheet Quick Tips Guide, on the employee intranet, states, as of November 8, 2011, in the Do s and Don ts section: DON T scratch thru an error but line thru and initial. In addition the Bureau of Internal Audit has given trainings along with Human Resources in which the information for making a correction on timesheet was given and this Quick Tips reference Guide was cited as being a source for compliance to making these corrections.

16 Audit Project #TA 2-10 December 15, 2011 Page 13 Parental Options cont d 2 instances of Non-exempt employee not signing out for lunch. (Supervisor Erin Bendily) Management does not concur Additional comments: Management states compensatory time is not owed to this employee due to the fact that employee was relieved of duties during his/her lunch break and had neglected to sign out. Fair Labor Standards Act (FLSA) regulations as state: Non-exempt employees must sign in upon arrival, departure and in/out from lunch each day. Due to employee not signing in/out for lunch it is undetermined whether employee is owed compensatory time according to the rule and regulations set forth within FLSA. 1 instance of leave slip not submitted for leave taken (Supervisor - Erin Bendily) 1 instance of timesheet and ZT02 report inconsistencies (Supervisor - Erin Bendily) 2 instances of timekeepers not ensuring all information is correct on employee timesheet basis (Supervisor Erin Bendily) Student & /School Learning Support 5 instances of timesheets not maintained on a daily basis (Supervisor Donna Nola- Ganey) 7 instances of employee corrections not corrected properly(supervisor Robert Schaff, Michael Coburn, Terri Simoneaux, Tasha Anthony, Tavia Crumpler) 2 instances of payroll documentation not presenting a clear, easily understandable record of all hours worked and leave taken (Supervisor - Robert Schaff) 2 instances of leave slip was not submitted for leave taken (Supervisor - Robert Schaff) 3 instances of default costing not filled out on timesheet (Supervisor Robert Schaff, Kartina Roberts) 3 instances of timesheet and ZT02 report inconsistencies (Supervisor Michael Coburn, Terri Simoneaux, Kartina Roberts) Planning and Reporting Services Pay period 22 timesheets were not available upon request. Management does not concur Additional comments: EP 3.2 states the Bureau of Internal Audit is responsible for conducting random and scheduled audits of time and attendance records for division/units. Records must be made available immediately upon request.

17 Audit Project #TA 2-10 December 15, 2011 Page 14 Audit Risks & Impact: The observations noted above increase risk for the SDE in the following manner if not addressed and corrected by management: Recommendation: Civil liability and penalties for noncompliance with the FLSA Unauthorized leave Unauthorized overtime Incorrect charge of leave to employee Incorrect pay to employees Noncompliance with Civil Service Payroll Rules and Regulations and other existing labor laws The Bureau of Internal Audit recommends management correct timesheets, leave slips, and associated backup documentation where appropriate; compile and implement a management action plan addressing each of the observations to prevent and detect future reoccurrences; and ensure all supervisors and staff comply with federal and state laws and regulations, as well as SDE policies and procedures

18 Audit Project #TA 2-10 December 15, 2011 Page 15 College and Career Readiness College and Career Readiness is under the direction of Debbie Shum, Superintendent, for time and attendance purposes and administration and consisted of a total of 33 employees tested over two (2) pay periods. Pay Period Units included in this audit: Supervisor(s) August 23, 2010 September 5, 2010 DOP Special Ed East - West Executive Org Support Louisiana Virtual Schools Dianna Keller Paul Theriot James Owens Wendy Thibodeaux Nancy Hicks Tiffanye Thomas October 18, 2010 October 31, 2010 College and Career Readiness DOP Special Ed East - West Executive Org Support Louisiana Virtual Schools Debbie Shum Paul Theriot James Owens Wendy Thibodeaux Nancy Hicks Tiffanye Thomas 12 instances of employee corrections not corrected properly (Supervisor Debbie Shum, Dianna Keller, Paul Theriot, James Owens, Wendy Thibodeaux, Nancy Hicks, Alan Gauthreaux) 12 instances of payroll documentation not presenting a clear easily understandable record of all hours worked or leave taken. (Supervisors Wendy Thibodeaux, Nancy Hicks, James Owens, Debbie Shum, Paul Theriot) 2 instances of timesheets not being maintained on a daily basis (Supervisor Paul Theriot, Debbie Shum) 3 instances of timekeepers not insuring all information is correct on employee timesheet (Supervisor Debbie Shum) 1 instance of leave slip and ZT02 report inconsistencies. (Supervisor Debbie Shum) 1 instance of special leave supporting documentation not attached to time and attendance packet. (Supervisor Debbie Shum) 1 instance of employee not having prior approval for Leave without Pay. (Supervisor Debbie Shum)

19 Audit Project #TA 2-10 December 15, 2011 Page 16 Audit Risks & Impact: The observations noted above increase risk for the SDE in the following manner if not addressed and corrected by management: Civil liability and penalties for noncompliance with the FLSA Unauthorized leave Incorrect charge of leave to employee Incorrect pay to employees Noncompliance with Civil Service Payroll Rules and Regulations and other existing labor laws Recommendation: The Bureau of Internal Audit recommends management correct timesheets, leave slips, and associated backup documentation where appropriate; compile and implement a management action plan addressing each of the observations to prevent and detect future reoccurrences; and ensure all supervisors and staff comply with federal and state laws and regulations, as well as SDE policies and procedures Management Response: Management concurs with observations and will implement corrections immediately.

20 Audit Project #TA 2-10 December 15, 2011 Page 17 Innovations Innovations under the direction of Rayne Martin, Deputy Superintendent, for time and attendance purposes and administration and consisted of a total of 33 employees tested over two (2) pay periods. Pay Period Units included in this audit: Supervisor(s) Certification, Preparation & Recruitment Terry Rinaudo Andrew Vaughan Ollie Tyler Elizabeth Shaw Educator Support Patrice Saucier Elizabeth Shaw August 23, 2010 Elizabeth Shaw September 5, 2010 Human Capital Ollie Tyler Stephanie Carlos School Turnaround Nicole Honore Patrick Weaver TAP Patrice Saucier Shelia Talamo Terry Rinaudo Certification, Preparation & Recruitment Andrew Vaughan Ollie Tyler Elizabeth Shaw Educator Support Patrice Saucier Elizabeth Shaw October 18, 2010 Elizabeth Shaw October 31, 2010 Human Capital Ollie Tyler Stephanie Carlos School Turnaround Nicole Honore Patrick Weaver TAP Patrice Saucier Shelia Talamo

21 Audit Project #TA 2-10 December 15, 2011 Page 18 Innovations 15 instances of employee corrections not corrected properly (Supervisor Terry Rinaudo, Andrew Vaughan, Ollie Tyler, Patrice Saucier, Elizabeth Shaw, Rayne Martin, Nicole Honore) Management does not concur Additional comments: Additional comments: Management response states Human Resources Timesheet Quick Tips Guide does not require, recommend, or even suggest corrections may only be made by drawing one line through the error; however Human Resources Timesheet Quick Tips Guide, on the employee intranet, states, as of November 8, 2011, in the Do s and Don ts section: DON T scratch thru an error but line thru and initial. In addition the Bureau of Internal Audit has given trainings along with Human Resources in which the information for making a correction on timesheet was given and this Quick Tips reference Guide was cited as being a source for compliance to making these corrections. 4 instances of timesheets default costing not being filled out on timesheet. (Supervisor Terry Rinaudo, Andrew Vaughan, Ollie Tyler, Patrice Saucier, Elizabeth Shaw, Rayne Martin, Nicole Honore) Management does not concur Additional comments: Managements states this creates an undue burden; however, our testing indicates a lack of consistencies in completing timesheets because most employees fill out default costing, while other does not. Bureau of Internal Audit recommends consistency within a division completing timesheets. 2 instances of timesheets not being maintained on a daily basis (Supervisor Terry Rinaudo, Andrew Vaughan, Ollie Tyler, Patrice Saucier, Elizabeth Shaw, Rayne Martin, Nicole Honore) Management does not concur Additional comments: Employee handwriting was unidentifiable by audit staff. EP 3.2 states payroll documentation should present a clear, easily understandable record of all hours worked and leave taken by staff. 2 instances of timekeepers not insuring all information is correct on employee timesheet (Supervisor Rayne Martin) 1 instance of overtime not preapproved by appointing authority. Supervisor Rayne Martin) 2 instances of management not signing and dating timesheets. (Supervisor Rayne Martin)

22 Audit Project #TA 2-10 December 15, 2011 Page 19 Audit Risks & Impact: The observations noted above increase risk for the SDE in the following manner if not addressed and corrected by management: Recommendation: Civil liability and penalties for noncompliance with the FLSA Unauthorized leave Incorrect charge of leave to employee Incorrect pay to employees Noncompliance with Civil Service Payroll Rules and Regulations and other existing labor laws The Bureau of Internal Audit recommends management correct timesheets, leave slips, and associated backup documentation where appropriate; compile and implement a management action plan addressing each of the observations to prevent and detect future reoccurrences; and ensure all supervisors and staff comply with federal and state laws and regulations, as well as SDE policies and procedures

23 Audit Project #TA 2-10 December 15, 2011 Page 20 Special Review of Re-Organizational Unit / Innovations During the course of the regular semi-annual Time and Attendance audit, Bureau of Internal Audit noticed some inconsistencies that lead to further review of Human Capital. The inconsistencies were related to two employees and the supervisor. The dates reviewed were July 1, 2011 September 19, Molly Horstman LaTanya Walker 14 mostly consecutive instances of employee s hours on the timesheet and the cardholder scanner were inconsistent Management does not concur Additional comments: Management states the immediate supervisor gave work from home approval; however, on July 15, 2011 Bureau of Internal Audit contacted the immediate supervisor for supporting documentation related to employee s work from home status and received a response back no one had approval to work from home. Furthermore, the immediate supervisor does not have the authority to give approval for this request. Approval can only be given by the Department of Education Superintendent, who had not been given this approval to anyone as of the dates in question. 1 instances of no activity on the cardholder transaction history report but the employee claimed 4 hours of annual leave. Employee s timesheet is not completed and maintained on a daily basis. 19 mostly consecutive instances of employee s hours on the timesheet and the cardholder scanner were inconsistent. Management does not concur Additional comments: Management states the immediate supervisor gave work from home approval; however, on July 15, 2011 Bureau of Internal Audit contacted the immediate supervisor for supporting documentation related to employee s work from home status and received a response back no one had approval to work from home. Furthermore, the immediate supervisor does not have the authority to give approval for this request. Approval can only be given by the Department of Education Superintendent, who had not been given this approval to anyone as of the dates in question. 3 instances of the timesheet not being maintained on a daily basis. Employee has multiple instances of inconsistencies in irregular work hours.

24 Audit Project #TA 2-10 December 15, 2011 Page 21 AUDIT SCOPE AND OBJECTIVES Time and attendance audits are conducted semiannually as of June 30 and December 31. For each semiannual period time and attendance procedures for one-half of the State Department of Education (SDE) Offices are examined to provide coverage to the entire SDE annually. This particular audit included the following offices: Office of the Deputy Superintendent Office of Educator Support Special School District The scope of this project included the following: Reviewing SDE automated time and attendance procedures, Reviewing Department of State Civil Service payroll rules and procedures, Examining fixed time entry sheets and supporting documentation, Examining fixed time entry reports, and Testing all active employees in each unit of the selected SDE offices. Our objectives included determining if: time and attendance records are maintained timely and properly, overtime, leave, and prior period adjustments are properly administered and recorded, restricted appointment, student, and hourly employees are reported and paid properly, management has complied with requirements of OMB Circular A-87, terminations and resignations are properly and timely recorded, and management is properly reviewing time and attendance documents In order to accomplish our objectives each employee and supervisor within each office was tested individually against forty (40) criteria based on federal and state laws and regulations as well as SDE policies and procedures. In addition, timekeepers were tested for compliance with job responsibilities including safeguarding time records and accurate data entry. The recommendations in this report represent, in our judgment, those most likely to bring about beneficial improvements to the administration of time and attendance in the offices audited. The varying nature of the recommendations, their implementation costs, and potential impact on operations of the SDE should be considered in reaching decisions on courses of action. Follow-up on management action plans will be conducted on a semiannual cyclical basis. Our audit was conducted in accordance with The Standards for the Professional Practice of Internal Auditing and the Code of Ethics issued by the Institute of Internal Auditors. By provisions of state law, this report is a public document, and it has been distributed to appropriate public officials.

25 Audit Project #TA 2-10 December 15, 2011 Page 22 We acknowledge with appreciation the courtesies extended to our representatives during the review. Dudley J. Garidel, Jr. Director of Internal Audit

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