The Tribune

By RASHAD ROLLE

Tribune Staff Reporter

rrolle@tribunemedia.net

AN audit of operations at the College of the Bahamas’ Oakes Field Business Office has concluded that the vice-president of finance was negligent in her duties and did not ensure that proper controls for decreasing the risk of theft were implemented. The audit was ordered after more than $12,000 went missing from the office last year.

A second audit, conducted after more than $1,000 went missing from the Business Office at the Northern Bahamas Campus (NBC) in Grand Bahama earlier this year, also concluded that the “absence of properly laid out policies and procedures” increased the risk of theft.

According to documents obtained by The Tribune, COB’s Chief Internal Auditor Erald Thompson II sent a report dated February 7, 2014 on the missing $12,563 from the Oakes Field Campus to COB Council Chairman Alfred Sears.

The audit was also addressed to the Chairperson of the Audit Committee of the College Council, Anita Bain. He addressed a March 18, 2014 report on the missing $1,720 from the NBC campus to Dr Early Carey-Baines, interim COB president.

Although the auditor concluded that no crime was committed by anyone involved, he accused the vice president of finance and assistant director of finance of being negligent in the performance of their duties. The assistant director, he said, failed to report a $7,739 shortage in the petty cash from the Oakes Field campus on June 28, 2013 and also failed to report that the keys for the petty cash tin were lost and that the monitor on her desk was blank for several weeks, therefore preventing her from observing movements of personnel in the cashier’s cage.

As for the vice president of finance, the auditor wrote: “There was an absence of leadership by the VPF which greatly contributed to the lack of internal controls and hence the $12,563 shortage in the Business Office. The VPF was negligent in the performance of her duties, in that she knew that the end of year petty cash reconciliation was supposed to have been reviewed by her, however, there is no evidence that she performed this function at the appropriate time.

“If the VPF had been performing her duties then this shortage would have been detected from June 2013 instead of being allowed to grow to over $12,000 by October 2013.”

The audit concluded that the environment in the Business Office was ripe for fraudulent transactions to occur because “the cashier’s cage operated without cameras for a few weeks after the move from (another building); the VPF, in her capacity as the leader in the Business Office, should have ensured that one of the first things to be installed in the new space was properly operating cameras; the VPF allowed the department to exist and operate without clearly defined policies and procedures to protect the college’s cash holdings; the VPF allowed an employee who had been suspended for a fraudulent act to retain the combination to the cash safe; additionally, the VPF did not ensure that the combinations were being changed frequently.”

The documents show that funds from the NBC campus went missing after employees collected students’ monies privately rather than have them go to the Business Office, a common practice that does not occur at the Oakes Field campus.

The auditor wrote: “In the absence of properly laid out policies and procedures, ‘practices’ are developed by employees and used and passed on as if they are actual policies. However, ‘practices’ rarely address the inherent risks surrounding the process that the employees are trying to accomplish. Cash is an asset that has an inordinately high inherent risk of theft, thus the controls surrounding cash receipts must be strong and documented for all to see and understand.”

The auditor concluded that with respect to the missing funds there was no evidence that anyone involved was involved in criminal behaviour, although he accused one employee of being negligent in the execution of her duties by turning over $3,322 in cash to another employee rather than depositing the cash in the Business Office and for failing to report the fact that the cash was missing.

He accused the other employee of incorrectly accepting monies and for breaching the fiduciary trust the college placed in her by losing $2,220.

The audits found that when it came to the missing money from the Oakes Field campus, “no formal policies and procedures detailing the necessary internal controls are documented in the business office.”

The missing funds from the NBC campus were never reported to the public but four unions, the Public Managers Union, the College of the Bahamas Union of Students (COBUS), the Union of Tertiary Educators of the Bahamas (UTEB) and the Bahamas Public Services Union (BPSU) all called for a forensic audit of COB’s books after the public learnt last November that $12,000 went missing from COB’s business office in New Providence.