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Audit of state prisons in Washington County finds procedural problems

Officials say they're working on correcting the deficiencies

January 14, 2013|By DON AINES | dona@herald-mail.com
  • The Hagerstown Correctional Complex is located on Roxbury Road outside of Hagerstown.
File photo

A state audit of the three state prisons in Washington County found deficiencies with how inmate receipts and disbursements, payroll adjustments and corporate card purchases were processed, but no evidence of misplaced or misused funds.

“We did not have any examples of questionable matters like that,” said Thomas J. Barnickel III, a legislative auditor with Maryland’s Office of Legislative Audits. “These are more process-type issues, to tighten up controls.”

The audit covered a period from June 1, 2009, to June 3, 2012, of the Department of Public Safety and Correctional Services — Hagerstown Region, which includes the Maryland Correctional Institution, the Maryland Correctional Training Center and Roxbury Correctional Center.

“Our audit disclosed several internal control and record keeping deficiencies” in the region, which became part of the newly established North Region in October, 2012, the audit report stated.

“DPSCS has already, or is in the process of correcting, the issues brought up by the auditors,” department spokesman Mark Vernarelli said. “No money is missing, no impropriety is alleged.”

Deficiencies were found in mail collections of inmate funds that could have led to money being “lost or misappropriated without detection,” the report said.

The auditors conducted a test of 17 deposits totaling about $113,000 “disclosed that verifications were performed 7 to 112 business days after deposit,” the report said.

The department is retraining employees and hiring new staff to improve the controls over the inmate deposit process, Vernarelli said.

The audit found the region “lacked certain critical controls for ensuring the propriety of inmate working fund transactions and records.” The working fund is used to disburse funds belonging to inmates, Barnickel said.

The report said one employee did not regularly examine supporting documents before approving and signing checks. Also, the signature stamp was unsecured, making it and blank checks accessible to unauthorized employees, it said.

Working fund statements were also not prepared on a monthly basis, the report said. All the deficiencies could have allowed for “errors or irregularities” to occur without timely detection, it said.

The audit also found deficiencies in payroll adjustments, particularly for overtime. The audit included a test of 10 overtime adjustments for 785 hours totaling $28,000, which found that 307 hours of overtime totaling $11,000 were “not supported by approved documentation.”

However, there was no indication that employees got paid for overtime not actually performed, Barnickel said.

The report recommended more review for supporting documentation adjustments paid “only if the required documentation is completed and submitted as required.”

Regarding corporate purchasing cards, the audit stated supervisors sometimes approved cardholder purchases without reviewing required documentation, such as itemized receipts and invoices.

The auditors’ recommendation was for supervisors to review all required supporting documentation.

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