Financial Management:

Audit of the Senate Gift Shop Revolving Fund for Fiscal Year 2010

GAO-11-326R: Published: Apr 6, 2011. Publicly Released: Apr 6, 2011.

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In a letter dated July 22, 2010, Congress requested that we conduct an audit of the Senate Gift Shop's cash receipts and cash disbursements recorded in the Senate Gift Shop Revolving Fund for the fiscal year ended September 30, 2010. In the letter, Congress also requested that we review the inventory accounting procedures of the Gift Shop. The Senate Gift Shop was established on October 6, 1992, to sell gift items to members of the Senate, Senate staff, and the general public. All sales receipts are taken to the Senate Disbursing Office for deposit into the Senate Gift Shop Revolving Fund in the U.S. Treasury. The Gift Shop then uses the cash receipts to purchase inventory items for resale, supplies, shipping, and other related services expenses. The Senate Disbursing Office maintains the money and makes payments on behalf of the Senate Gift Shop Revolving Fund. Salaries and benefits of Senate employees who work in the Gift Shop are not paid from the revolving fund; rather, they are paid from the "Salaries, Officers, and Employees" appropriation account of the Senate. Additional costs of the Gift Shop such as rent and utilities cannot be readily determined and are covered by other appropriated Senate funds.

We found that recorded cash receipts and cash disbursements of the Senate Gift Shop for the fiscal year ended September 30, 2010, were consistent with the purpose of the Senate Gift Shop Revolving Fund and supported by documentation approved by authorized shop management. We also found that overall, the Gift Shop's inventory accounting procedures provided reasonable assurance that it appropriately accounted for physical quantities on hand and that items were safeguarded from theft and loss. However, our testing identified instances in which shop personnel either did not fully adhere to established policies and procedures, or written policies and procedures were not sufficiently detailed for certain control activities. Therefore, we are making a recommendation that management update the Gift Shop's existing written accounting procedures to improve their effectiveness. We are also making a recommendation that Gift Shop management disseminate the updated accounting procedures, train personnel as necessary, and review subsequent activities for compliance. In commenting on a draft of this report, the Secretary of the Senate agreed with our recommendations and stated that Gift Shop management is in the process of implementing our recommendations.

Recommendations for Executive Action

  1. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Senate should direct Senate Gift Shop management to update existing written procedures for cash receipts and cash disbursements to include: (1) documented reviews of weekly deposit envelopes (cash receipts), (2) a description of any manual adjustments to amounts on "X" and "Z" reports in the "Notes" section of Daily and Weekly Cash Sheets (cash receipts), and (3) documented reviews of monthly reconciliations (cash receipts and disbursements).

    Agency Affected: Secretary of the Senate

  2. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Senate should direct Senate Gift Shop management to disseminate updated accounting procedures, train personnel as necessary, and establish a mechanism to provide for subsequent review of activities for compliance.

    Agency Affected: Secretary of the Senate

 

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