Review of Internal Controls Over the Third Party Draft System, Regional Administrative Support Center - Region IV

EXECUTIVE SUMMARY:

This final audit report on the internal controls over the third party draft (TPD) system in the Regional Administrative Support Center, Division of Finance, Atlanta Georgia estimates that payments of $3.2 million were made through TPDs that were not within the guidelines of the Department of Treasury or HHS policy. We found that the TPD internal control system was not documented, the separation of key duties was inadequate, access to TPDs and the supporting documentation was limited and accountability over blank drafts was not assigned. The ASMB generally agreed with our recommendations and has initiated actions to implement enhanced internal controls.