Auditor notes cash-handling problems from city dock

The city of Bainbridge Island did not properly safeguard cash that was collected at the city dock last year and violated state law by not depositing money collected from the dock on a daily basis, according to the Washington State Auditor’s Office.

The state auditor recently finished its audit of the city for the year of 2017.

Although the audit did not contain any “findings” — matters the state deems as more serious violations of state laws or regulations — state officials did outline multiple concerns about cash handling from the city’s dock that were passed along to city officials in a management letter July 24 from Audit Manager Carol Ehlinger.

In the letter, Ehlinger said problems found with the city’s cash-handling procedures will be revisited during the state’s next audit of the city.

“We have already discussed our comments with and made suggestions for improvements to city officials and personnel,” Ehlinger noted in the letter.

State officials said the city had receipts for $12,235 in revenues from the city dock 2017 and $6,318 through May 2018.

The problems that were found included:

• Annual trailer passes were not stored in a secure location and were not numbered sequentially, which means the city cannot be sure all of the passes are accounted for;

• The city has a log for trailer passes, but does not make sure it matches actual receipts;

• Deposits were not made in accordance with state law. Deposits were made intermittently, ranging between three and 19 days apart, and the city could not provide documentation that a waiver of daily deposits was granted (as state law requires);

• Cash was transferred between the dock and the front desk cashier without counting and documenting how much was transferred; and

• Uncounted cash was stored in a vault, which multiple employees can access, until the cashier prepared it for deposit.

The management letter said the lack of safeguards limits the city’s ability to find out who would be responsible if cash went missing, but “also increases the risk that errors or irregularities could occur and not be detected in a timely manner, if at all.”

State officials said they could not be sure if all money collected at the city dock was deposited intact due to the lack of cash controls.

“We recommend the city implement controls to ensure deposits are made promptly and are adequate to protect and detect loss or misappropriation of dock receipts,” Ehlinger said in the letter.

When asked for comment on the state audit management letter, Bainbridge City Manager Doug Schulze noted the lack of findings in the state’s latest review.

“We are extremely pleased to receive a clean audit once again, and appreciate the work of the Office of the State Auditor,” Schulze said in an email.

“This marks the fifth consecutive year the city’s audit has resulted in no findings. The auditor has provided city management with suggested improvements, which will be addressed in a timely manner,” Schulze said.

The accountability audit covered the time frame of Jan. 1, 2017 through Dec. 31, 2017.

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