YELLOW SHEET Office of the State Auditor of Missouri Claire McCaskill

June 13, 2002

Report No. 2002-44

The following areas of concern were discovered as a result of an audit conducted by our office of the Department of Mental Health, Western Missouri Mental Health Center (WMMHC).

The WMMHC Auxiliary is a not-for-profit organization created to provide benefits to patients and employees at the facility.  The auxiliary generates approximately $75,000 in annual gross revenues.  During our review, we noted the following deficiencies: 

·        Financial statements prepared by the facility for auxiliary activities were inaccurate and incomplete during the years ended June 30, 1999 and 2000 and were not prepared for the year ended June 30, 2001. 

·        Bank reconciliation were not completed on a timely basis and receipts were not transmitted intact for deposit on a timely basis.  During August 2001, $125 was received and appears to be missing. 

·        The former gift shop coordinator cashed numerous personal checks from gift shop receipts.  The personal checks were usually not deposited until several weeks later and several of these were returned by the bank for non-sufficient funds. 

·        Overages/shortages in receipts were not investigated and a reconciliation of monies received and amounts transmitted was not performed by an independent person. 

·        Documentation was missing for several days' activity in the gift shop, instances were noted where cash sales in the gift shop were not entered into the cash register and receipts were not always obtained from the cashier's office for the transmittal of auxiliary funds to be deposited. 

·        Perpetual inventory records for gift shop assets were not maintained properly. 

·        The auxiliary had not filed all applicable tax returns in a timely manner, nor had it always followed its written by-laws or articles of incorporation.  

Due to the seriousness of these deficiencies, we were unable to determine whether all funds received by the auxiliary were properly recorded.   

The amount of monies held by the auxiliary appears excessive.  At June 30, 2001, the balance of the checking and savings accounts totaled approximately $60,000.  An Attorney General's opinion concludes that not-for-profit corporations which operate on facility premises for the benefit of patients should deposit revenues to the Mental Health Trust Fund.  Excess funds should be turned over to facility officials to be credited to the Mental Health Trust Fund and used for the benefit of all patients or clients. 

At June 30, 2001, the facility maintained a fleet of 32 vehicles for use by both personnel of the hospital and the residential treatment facilities.  Vehicles permanently assigned to individuals may not be getting used efficiently and effectively.  The vehicle logs maintained by the superintendent and regional director did not always identify the specific business use for the assigned vehicles, nor was personal use always identified.  In addition, travel logs for state-owned vehicles were not always complete. 

Numerous vehicles were underutilized during the fiscal years ended June 30, 2001, 2000 and 1999.  There were 11 vehicles in fiscal year 2001, 22 vehicles in fiscal year 2000, and 16 vehicles in fiscal year 1999 that were driven less than 5,000 miles annually.  While the facility reduced the total fleet in fiscal year 2001, the number of underutilized vehicles is still approximately one-third of the entire vehicle fleet. 

Procedures for monitoring credit card purchases are inadequate.  During the years ended June 30, 2001 and 2000, credit card purchases totaled approximately $29,000 and $33,000 respectively.  Credit card receipt slips are not reconciled to the credit card statement before payment is made.  Facility personnel indicated some employees rarely turn in their charge slips for gas purchases.  Additionally, all gas purchases are not recorded on the vehicle logs. 

All credit cards are not adequately safeguarded.  An incident in August 2001 was disclosed where one of the drivers had used a gas card to make unauthorized purchases in excess of $1,500.  The cards were kept in a locked desk drawer in the Transportation Department.  Security personnel and transportation drivers had access to the office and the drawer, when the transportation clerk was not available.  Credit cards are now stored in a locked safe and access is limited. 

Also included in the audit are recommendations to improve policies and procedures regarding bidding, expenditures, and incident reports.

Complete Audit Report