Agreed-Upon Procedures – Fiscal Year 2023

Sign Up For Our Audit Reports Email Distribution List

---

Report Summary

Background

The Office Auditor of Accounts (AOA) performed an Agreed-Upon Procedures engagement on bank reconciliations prepared by the Office of the State Treasurer (OST) for each quarter end of fiscal year (FY) 2023. OST’s bank reconciliation team reconciles the collections and disbursements recorded with banks with what is recorded in the state’s accounting system (First State Financials). The team ensures the total amounts are accurately recorded in both systems. OST continues to work on their transition from Trintech to Frontier reconciliation software with an estimated completion date no later than June 30, 2027.

The OST Reconciliation and Transaction Management team was responsible for the reconciliation of Delaware’s 59 cash and investment accounts in fiscal year 2023, inclusive of new bank accounts opened as part of the OST banking conversion project. As of June 30, 2023, the total balance of Delaware’s Cash and Investment accounts was $7,351,665,311.57.

AOA is authorized under 29 Del. C. §2906 to perform this engagement.

Key Information and Findings

The books and records are kept in accordance with generally accepted accounting principles and are reconciled with the various bank accounts. In the performance of the agreed upon procedures, AOA observed four out of the ten agreed-upon procedures were not fully in conformance with the State of Delaware Budget and Accounting Policy Manual (BAM) as follows:

• During the performance of the agreed-upon procedures, it was noted that the unexpended stale check write-off balance in excess of $100,000 were not credited to the General Fund as of June 30, FY 2023. This action does not align with the requirements specified in 29 Del. C. §2706(c), which mandates such amounts to be transferred to the General Fund at the end of the fiscal year.

• Activity by Balance Sheet (DGL046) Report Discrepancies: AOA identified several corrections and adjustments that were not performed timely (within 30 to 60 days post quarter end) by OST.

• Bank Account Reconciling Item Supporting Documentation: In vouching newly reconciled items to their supporting documentation, AOA was unable to agree the amounts of seven items to their supporting documentation.

Policy and Procedures: OST continues to use the policies and procedures last revised August 2005 which reflect outdated reconciliation processes, bank account information, and system information. This discrepancy affected two separate procedures.