Theft Control Guidelines

As designated by the Park Board, the Frankfort Square Park District issues checks for payroll and accounts payable. All prepared checks are required to be signed by two (2) authorized signatories, Executive Director, Superintendent of Recreation, Superintendent of Parks, President, Vice President, or Treasurer.

A list of the accounts payable is prepared by the Business Manager from invoices received, reviewed, and matched to the purchase order and line item for remittance. Purchase order amounts of $250 or less are approved by Department Heads and submitted to the Business Manager. Purchase order requisitions greater than $250 must have prior approval from the Executive Director. All approved invoices are prepared for check processing by the Business Manager, and computer checks are generated, along with a list that is presented to the Park Board of Commissioners, for payment approval at the monthly Board Meeting. If a payment is required before the next Board Meeting; i.e. utility payments, bank or credit card payments, Board approved project costs, and other recurring bills, the Executive Director will approve the issuance of these checks with the required two (2) signatures.

When preparing invoices for check printing, the designated Accounts Payable Clerk enters invoices into the payroll software system by payee, invoice number, and line item account. The system will provide an error message if the invoice number is duplicated. The designated Accounts Payable Clerk prints the check register and verifies that check information is correct. All pre-numbered checks are printed and attached to the corresponding invoice and supporting documents. Checks are reviewed and signed by two (2) signatories and given to the Office Manager. The office staff then prepares the checks for mailing and all check stubs and documentation are retained in accounts payable files. Any unused or incorrect checks are defaced by marking "VOID" on the check and then retained with the accounts payable files. On the infrequent occasion when a check must be made payable to “cash”, it must be completed per procedure documented in Attachment A.

All employees' hours are reported to the designated Payroll Clerk who prepares the bi-weekly payroll checks. All Department Managers approve their staffs' hours based on individual hours worked for the payroll period. The designated Payroll Clerk prints the payroll report list by employee, hours worked by department and rate, and total pay. The report information is entered into the payroll software system by employee. The designated Payroll Clerk prints the payroll journal and verifies that check information is correct. All pre-numbered checks are printed and attached to the supporting documents and payroll reports. Checks are reviewed and signed by two (2) signatories and returned to the Office Manager. Payroll checks are distributed in person to staff or by mail. If office staff does not recognize an employee that is picking up his/her check in person, that individual will be required to provide proof of identity in order to receive his/her payroll check.

Positive Pay

Fraud prevention tools have been implemented through the District’s financial institution, Old Plank Trail Community Bank. All communication between the bank and the Park District is encrypted, and the main account that is used for payroll and accounts payable is designated Positive Pay. The designated Bookkeeping Staff Member uploads a list of all checks that include accounts payable and payroll. The bank confirms checks presented to the list, and if any there are any questionable items presented for payment, designated Park District staff must individually approve or deny payment. ACH transactions are also confirmed as presented. The Executive Director provided a list of approved entities and maximum dollar amounts for ACH transactions to the bank, and similar to accounts payable and payroll checks, any items presented that do not meet the preauthorized guidelines for payee and amount are marked for review by designated Park District staff and either approved or denied for payment.

Revenue Controls:

The procedures outlined for revenue control practices are important to protect the employee and to protect the interest of the Frankfort Square Park District, and should be adhered to at all times. Compliance of all revenue handling procedures is the responsibility of all District staff that handle revenue such as Facility Managers, Managers on Duty, Supervisors, Office Staff, Cashiers, and any other individuals responsible for revenue handling.

Cash Drawer Handling

1. The Office Manager and Office Staff have access to the office drop safe combination and will access the safe when preparing the registers for morning opening and closing procedures and daily revenue activity balancing.

2. It is the responsibility of the Office Staff to verify all starting cash in the drawers prior to opening, and report any discrepancies to the Office Manager. At no time will any cash drawer remain open after completing a transaction.

3. When the Office Staff leave the area for any reason or any length of time, they are to secure the cash drawers.

4. Receipts shall be completed for all transactions. Receipts may be printed or sent via email to the customer. In the case of a power outage or system failure, a receipt book is used to record transactions. Customers are given handwritten receipts, and copies are retained along with payment to record the transactions once the system is operable. If the system is not accessible by close of business, receipts and payments are stored in the office safe for next day processing.

5. Facility Supervisors are responsible for balancing cash from transactions made at a Park District facility and securing it in a drop safe. The Superintendent of Recreation, Office Manager, or Office Staff transport the cash envelope to the Park office, and the office employee verifies the cash records, enters the receipt in the RecTrac system, and adds the cash to the cash drawer to be included with the day's deposit.

6. Under no circumstances will it be acceptable to cash a check for anyone, including District employees.

7. All Office Staff have their own login and password for the RecTrac system, and it is their responsibility to logoff the system when completing transactions.

8. At no time should there be cash or checks residing on a desk or counter after a transaction has been completed.

9. All cash and checks are required to be deposited within 24 hours, or in case of a weekend or holiday, the next regular business day.

10. No cash or cash refunds shall be given back if the form of payment is a check, credit, or debit.

11. In order to minimize risk, credit card information is not stored on file or in the RecTrac system. Only the data elements on the payment card are needed at the time the transaction is processed. If payment card data is on registration documents, the card information is redacted once the registration is completed. Documents with legible payment card data are destroyed by machine shredding once transactions are completed. Exception – dance program payment plan. All participants in the payment plan complete and sign agreements which are kept in the safe. The Office Manager processes the charges for each payment date and immediately returns the information to the safe until the next payment is due.

12. In addition to the cash drawers, an additional bank is retained in the office safe and is available to make change when needed. The Office Staff will count and exchange the currency and advise the Office Manager for guidance to rectify the situation.

Daily Cash Activity Balancing

1. At the end of shift, the Closer, an assigned office employee, will close and lock the counter shade before emptying the cash drawers to count the cash and checks. Refer to Attachment “B”.

2. The Closer prints the RecTrac cash journal, verifies the amounts, and signs the journal report. The starting cash balances are placed in the cash drawer bags and secured in the office safe. The remaining cash and checks are bundled as a deposit, placed in the cash journal bag with the closing reports, and secured in the office safe.

3. On the following business day, the Opener, an assigned office employee, will prepare the office setup for daily business needs. Refer to Attachment “C”. The Opener recounts all cash and checks from the prior day's transactions, and verifies the amounts to the cash journal report. Refer to Attachment “D”. This procedure is done away from the office and public in a locked room with key pad access across from the Business Manager’s office, Room #314.

4. The Opener will also run the appropriate reports from the RecTrac system for balancing purposes. It is the Opener's responsibility to run all cash/credit reports, review and sign the journal report, and prepare the bank deposit.

5. If there is an overage or shortage, an explanation must be detailed and signed by the Opener. Regardless of the amount, the Opener advises the Office Manager of the discrepancy.

Deposit Controls:

Once the Opener reviews the cash journal report, the bank deposit is prepared. Bank deposit books are secured in the office safe, and duplicate deposits slips are retained for monthly cash audit reviews completed by the Office Manager.

A locked money bag is used to transport the deposit to the bank. In addition, the money bag is placed inside an unmarked satchel carried by the office employee and kept out of view of persons outside the District vehicle.

The bank stop is the primary responsibility of the office employee when transporting deposits. The deposit receipt is brought back to the office, and the Office Manager audits the cash journal report and submits a copy of the report and deposit receipt to the designated Bookkeeping Staff Member.

On a monthly basis, the designated Bookkeeping Staff Member reconciles the cash deposits against the bank statement. All credit card transactions are also audited by the Office Manager, and RecTrac credit summary reports are submitted to the designated Bookkeeping Staff Member. Month-to-date reports are printed from the District's payment card service provider and reconciled against RecTrac reports and bank statements. Each month, the Office Manager and designated Bookkeeping Staff Member confirm accounts to be in balance and prepare month-end reports for District Management and Park Board.

Refunds:

A refund transaction is entered in the RecTrac system and a refund request form is printed by an office employee. The form includes the following information.

Ÿ Purchaser's name, mailing address, and telephone number

Ÿ Original transaction date

Ÿ Description of the goods or services that are being refunded

Ÿ Original selling price

Ÿ Reason for the refund

The office employee signs and dates the form and submits it to the Director/Office Manager who approves the refund for check processing usually within 7-10 business days. Refer to Attachment “E”.

Goods or services purchased by check are refundable once the original check has successfully cleared the bank.

When processing a refund for a credit card transaction, if the return is done the same business day as the original purchase, the return can be refunded to the purchaser's credit card. If the return is done at a later date, a refund will be issued in check form since credit card information is not stored.

Physical Theft Controls:

There are cameras located inside and outside the Park Administration building and can be monitored for real time activity or recorded film as needed. There is a two-way mirror mounted on the cabinet wall in the office to monitor the front of the office and counter. The office door is to remain closed at all times. Keypad code access is used by staff to enter the office. The office door code is changed annually, in the winter. The method for changing the office door keypad code is secured in a secure location.

Office desk drawers and file cabinets are locked by the Closer after the day's shift. On the next day of business, the Opener unlocks all desks and file cabinets in preparation of opening for business. Cash registers have moveable monitor screens allowing customers to view their transactions and payment input by the Cashier.

Community groups are allowed access to meeting rooms at the Park Administration building and various Park facilities. The office retains a sign-in and sign-out key log for group representatives needing access to a building. A building usage form is completed by a primary and secondary representative of the community group and meeting dates, times, and facilities are reserved in the RecTrac system by an office employee. Refer to Attachment “F”.

Building keys are labeled by location and numbered accordingly. A key may be picked up the day prior to the

reserved meeting after filling out the key log. Keys are to be returned to the Park Administration building either in person during business hours or by drop box located outside the front door, within 24 hours of the reservation.

An office employee will check the key back in by checking the log and return the key to the office drawer. Refer to Attachment “G”. If a key is not returned in time, an office employee will contact the primary representative.

Most community group representatives are issued fobs, which are active and trackable at the Community Center door.

The Executive Director’s signature stamp is stored in his office safe. The Assistant to the Executive Director is authorized to use the stamp only in cases when he is away from the office due to geographical constraints and is unable to return to sign documents that must be executed in an expeditious manner.

The Park District utilizes safes in various facilities to secure cash drawer and cash journal bags, cash deposit slips, blank check binders, deeds, vehicle titles, etc. All safes are kept in locations out of public view, and when possible, are bolted to provide security.

District computer hard drives are destroyed on premises before disposal.

Human Element Controls:

Criminal background checks are required for all persons as a condition of employment with the Frankfort Square Park District. Department Supervisors submit to the Director the application and necessary forms required as a condition of employment.

The Director submits the background, and drug and alcohol checks to the appropriate agency for review prior to employment. Results are disseminated to the appropriate Department Head. Driving records are required for persons who will be driving vehicles/equipment within the District.

Persons working with agency funds are required to have background and drug and alcohol checks. These persons include, but are not limited to: Executive Director, Director, Recreation Supervisors, Office Manager, Bookkeeping Staff Members, Office Staff, and any other person handling agency funds.

The Assistant to the Executive Director is responsible for retrieving, opening, and distributing agency mail. Mail is opened daily in the front office and placed in the appropriate employee mailboxes, also located in the front office.

Refer to Attachment “H”.

During business hours, the Office Manager will periodically audit the front office cash registers by pulling the RecTrac daily cash journal, listing cash receipt information, and reconciling cash to receipts.

Annually, in the month of June, the District has employees update their emergency contact information for the District personnel files

Key Controls:

Purpose and Scope

The Frankfort Square Park District shall maintain locking systems for the protection of patrons, participants, visitors, staff, facilities, and property while attempting to responsibly balance, at times, the opposing concepts of security and convenience. This policy establishes a framework by which keys and/or fobs will be issued, authorized for use, monitored, and maintained.

Authorized use of keys and/or fobs shall be defined as the use of assigned keys and/or fobs during the performance of duties in the course of an employee’s assigned work shift. The use of keys and/or fobs to gain access to Park District facilities outside of an assigned shift, without the direct consent of the Executive Director or designee, may result in disciplinary measures up to and including discharge.

The Frankfort Square Park District may use and include all varieties of locking devices including exterior gate and door locks, interior area locks and keys, combination devices, and all other locking devices including padlocks and electronic access devices. All of the above locking system components are property of the Frankfort Square Park District.

Administration of the Key System

The Frankfort Square Park District Executive Director is authorized to establish and administer regulations and procedures in order to provide physical security of all Frankfort Square Park District facilities and its occupants, and to provide for administration and control of keys. The administration of key control shall be delegated to the Executive Director or designee.

The Assistant to the Executive Director shall be responsible for the maintenance of key controls including the issuing of keys and key control record keeping. No individual may use personal locking devices, nor may locks be changed or re-keyed without approval of the Executive Director. Unauthorized locking devices will be removed. Any damage or repair necessitated by the removal of unauthorized locks will be the responsibility of the department or individual found in violation of this policy.

Keys to Frankfort Square Park District-owned cabinets, lockers, desks, drawers, etc. are not covered under this policy. Keys shall be furnished upon request when available; but the issuance, control, and recovery shall be the responsibility of the department head/supervisor.

Key Authorization and Eligibility

All requests for keys should be carefully considered so that the protection and security of District facilities and property are maintained. District Administration, Department Heads, or Supervisors shall be the only personnel authorized to request keys within their respective departments for their staff and/or volunteers. These individuals are required to complete the Employee Key/Key Fob Request Form, signed, and returned to the Assistant to the Executive Director. Refer to Attachment “I”. Recipients of District keys will complete and sign the lower portion of the Employee Key/Key Fob Request Form prior to key issuance from the Assistant to the Executive Director. The recipients will be responsible for key safekeeping and at no time should leave keys unattended (i.e., hanging in a door lock, lying on a desk, etc.).

Fob Authorization and Eligibility

All requests for fobs should be carefully considered so that the protection and security of District facilities and property are maintained. District administration, Department Heads, or Supervisors shall be the only personnel authorized to request fobs within their respective departments for their staff and/or volunteers. These individuals are required to complete the Employee Key/Key Fob Request Form, signed, and returned to Office Clerical personnel. Refer to Attachment “I”. Recipients of District fobs will complete and sign the lower portion of the Employee Key/Key Fob Request Form prior to key issuance from Office Clerical personnel. The recipients will be responsible for fob safekeeping and at no time should leave fobs unattended (i.e., lying on a desk, counter, etc.).

Return of Keys and Fobs

Ÿ All keys shall be returned to the Assistant to the Executive Director upon termination of employment, transfer to another department, or upon the request of the department head or Executive Director.

Ÿ All fobs shall be returned to the Office Clerical personnel upon termination of employment, transfer to another department, or upon the request of the department head or Executive Director.

Ÿ Keys and fobs shall not be exchanged between individuals.

Ÿ Final paychecks may be held by the Office Manager until documentation is presented that keys or fobs have been returned.

Ÿ Part-time, seasonal employees, and volunteers who are issued keys or fobs must follow all District key policies.

Ÿ Failure of employees to return keys or fobs will be referred to the Executive Director.

Lost/Damaged Keys and Fobs

The loss or suspected loss or damage of any keys is to be reported to the Assistant to the Executive Director, and loss or damage of any fobs is to be reported to the designated Office Staff Member personnel. The Assistant to the Executive Director shall investigate each incident of lost keys and in the case of lost keys, may file a formal request to the Executive Director for authorization of lock changes due to a breach of security. The designated Office Staff Member shall investigate each incident of lost fobs, and in the case of lost fobs, may file a formal request to the Executive Director for authorization to deactivate the fob due to a breach of security.

Key/Fob Authorization for Outside Groups

The Park District provides access to facilities used by community groups such as Wildcats Football, FSBL, the Boy Scouts, and HOA groups. These requests are carefully considered so that the protection and security of District facilities and property are maintained. Individuals from these groups are required to complete the Key/Key Fob Request Form, signed, and returned to the designated Office Staff Member. Refer to Attachment “J”. Recipients of District fobs will complete and sign the lower portion of the Key/Key Fob Request Form prior to key issuance from the designated Office Staff Member. The recipients will be responsible for fob safekeeping and at no time should leave fobs unattended (i.e., lying on a desk, counter, etc.).

Inventory Controls:

The Frankfort Square Park District maintains various inventory methods in order to balance the District’s needs with its fiscal responsibility. Tracking Park District inventory aids in purchasing, budget forecasting, and preventing theft both internally and externally.

Department Heads/Supervisors are responsible for the physical inventory requirements and replenishment of supplies for their respective programs and departments.

Administrative inventories are conducted often and at irregular intervals with additional spot checks due to the amount of consumable items used on a daily/weekly basis, i.e. paper, pens/pencils, printer ink toners, etc. The Office Manager and Office Staff are responsible for the opening and closing of the office and making sure that these inventories are stocked and available for daily operations.

AMP/AssetMaxx

The Frankfort Square Park District established a detailed record of its capital assets and depreciation through AMP/AssetMaxx, a web-based fixed asset program. The designated Bookkeeping Staff Members maintain the District’s asset information, utilizing the AMP/AssetMaxx software program to:

1. Determine values, identify, and track all District properties and equipment for insurance purposes

2. Ensure GASB 34 compliance

IT Inventory

The District’s IT contractor manages a spreadsheet system wherein all electronic items, computers, monitors, printers, cameras, etc. are identified by make/model/serial number/date of purchase/user and/or location.

Golf Course RecTrac POS System

The RecTrac POS system employed by District’s Square Links Golf Course, tracks greens fees, range fees, club and cart rentals, sales of golf balls and tees, beverage and food sales. The RecTrac POS system aids in determining trends in items that are sold, tracks items in stock, and what needs to be reordered to ensure uninterrupted operation. The fully integrated RecTrac POS system also provides reports for accounts payable/receivable, and purchasing through tracking cash register sales.

Surplus Property Disposal

The Frankfort Square Park District Property Disposal Policy provides information and guidelines for the disposal of all District property. Refer to Attachment “K”. The policy provides information and guidelines for the disposal of all Frankfort Square Park District property. The policy provides its staff and employees with a clear understanding the District has used the property to its best advantage and has realized the maximum amount of value possible. All departments are informed of the appropriate method for declaring and disposing of surplus, salvage, scrap, and worthless equipment and materials that have been purchased or donated to the Park District.

The Frankfort Square Park District Executive Director is authorized to approve all requests for disposal of property/equipment, and in the event the item(s) exceed $1,000 the information is presented to the Board of Commissioners.

Purchase Controls:

The purpose of the FSPD Purchasing Authority Policy is to outline the levels of purchasing authority and to establish consistent procedures for all District purchases. Purchases are defined as either single or multiple items purchased simultaneously from a single vendor.

Department Heads and/or supervisors may authorize and execute purchases up to $250. Any purchase over $250 must be approved by the Executive Director. Purchases of $10,000 or more must be communicated to the Board of Commissioners, and any purchases of $20,000 or more must have Board approval.

Summary of Signatory Approvals

$0.00 - $250, Department Head/Supervisor

$250 - $9,999, Department Head/Supervisor and Executive Director

$10,000 - $24,999, Department Head/Supervisor, Executive Director and communication to Board for notification

$25,000 and over - Department Head/Supervisor, Executive Director, and documentation of Board approval

A minimum of three quotes must be obtained for any capital purchase over $25,000, not included in qualified purchasing opportunity. Written quotes should be secured, however if phone or website/internet quotes are obtained, proper documentation must be submitted with the purchase requisition including vendor name, date, item descriptions, and prices. Competitive bidding must be instituted for any purchase over $25,000, and at the Executive Director's discretion, may be required for certain purchases less than $25,000. Certain specialized items of a service or technical nature may not require competitive bidding, however quotes will be requested from as many vendors as reasonably possible. The products and services should be included when obtaining price quotes.

In general, all items purchased should have been included in the Board approved budget for the fiscal year. The Executive Director is authorized to approve up to a $25,000 unbudgeted purchase, and this expenditure should be reported to the Board in the next Executive Director's report.

Department Heads and approved Supervisors with authorized District credit cards make District purchases using their assigned card(s). A Credit Card Agreement Form, outlining the terms and conditions for card usage, must be signed by the Department Heads and/or Supervisors, and authorized by the Executive Director when a credit card is issued.

Refer to Attachment "L".

Internal Control Practices: Purchasing

Overall accountability is maintained when purchases are authorized, reviewed, and approved based on signed agreements, contract terms, and purchase orders.

Best practices:

Ÿ Comply with ethical buying practices and policy

Ÿ Review and update signature authorizations periodically

Ÿ Verify receipt of goods and services against contract/purchase order and invoice information

Ÿ Reconcile reports for accuracy of recorded transactions

Ÿ Monitor to ensure that invoices are paid in a timely manner

Potential consequences for unaccountability:

Ÿ Unauthorized, unnecessary, or fraudulent purchases

Ÿ Unauthorized work performed by suppliers

Ÿ Vendor late fees assessed due to late payments

Ÿ Improper charges to incorrect account/funds resulting in a misappropriation of funds

Security of Assets

Once purchased goods are received, the materials are accounted for by counting the inventory and comparing the results with amounts shown on control records. The inventory is either distributed or secured in a safe location.

Best practices:

Ÿ Secure goods in a safe, restricted area

Ÿ Restrict inventory access to appropriate staff

Ÿ Lock goods and materials, and provide key or combination to as few people as possible

Ÿ Keep inventory records and periodically calculate beginning and ending inventory amounts

Potential consequences for unsecured assets:

Ÿ Theft of goods

Ÿ Inventory shortages

Ÿ Additional costs incurred for replacement of goods

Review and Reconciliation

The designated Bookkeeping Staff Member reviews a supplier's invoice, packing slips, and purchase orders on a timely basis. Accuracy of the information is checked for prior payment, correct quantity ordered, and price charged. Monthly ledger reconciliation enables the designated Bookkeeping Staff Member to find improper charges and validate appropriate financial transactions.

Best practices:

Ÿ Review supplier invoices for accuracy by comparing charges to purchase orders.

Ÿ When an invoice is received, verify that the goods and services purchased have been received by requesting a Purchase Receipt Form from the Department Head and/or Supervisor. Any receipts or documentation should be attached to the form and submitted to the designated Bookkeeping Staff Member. Refer to Attachment "M".

Ÿ Perform monthly reconciliations of operating ledgers to ensure accuracy and timeliness of expenses.

Potential consequences if review/reconciliation not performed:

Ÿ Improper charges to department budgets

Ÿ Disallowances resulting from costs charged to incorrect accounts/funds

Ÿ Payments made for items or services not provided