The District of Columbia's Banking and Short Term Investment Management

GGD-82-71: Published: Jun 23, 1982. Publicly Released: Jun 23, 1982.

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GAO evaluated the economy and efficiency of the banking, cash management, and short-term investment operations of the District of Columbia government.

In general, the District has a sound cash management system and utilizes bankwire, lockbox, and other auxiliary services and maximizes the investment of idle funds. However, GAO found that there were several areas where cash management could be improved. The wide range of bank service charges indicated that the District may be paying inappropriate prices to some banks. Competitive bidding for banking services is a good cash management tool for obtaining the best price for the services. Cash forecasting is made difficult by inadequate information and control over anticipated cash receipts.

Recommendations for Executive Action

  1. Status: Closed - Implemented

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

    Recommendation: The Mayor of the District of Columbia should require the District cash managers to maintain balances only as needed to compensate banks and to maximize the use of surplus funds for investment purposes.

    Agency Affected: District of Columbia

  2. Status: Closed - Not Implemented

    Comments: The District has made some progress in terms of studying this issue. Although the recommendation is still valid, GAO must close the case because there is no longer a D.C. audit site staff available to perform followup work, and such a staff is not expected to be available in the future.

    Recommendation: The Mayor of the District of Columbia should expedite the deposit of afternoon Treasury receipts to increase the available deposit funds.

    Agency Affected: District of Columbia

  3. Status: Closed - Not Implemented

    Comments: Althought the recommendation is still valid, GAO must close the case because there is no longer a D.C. audit site staff available to perform followup work, and such a staff is not expected to be available in the future.

    Recommendation: The Mayor of the District of Columbia should require all agency controllers to furnish daily information concerning anticipated receipts and disbursements to the cash manager for more effective cash flow forecasting and management.

    Agency Affected: District of Columbia

  4. Status: Closed - Not Implemented

    Comments: Although the recommendation is still valid, GAO must close the case because there is no longer a D.C. audit site staff available to perform followup work, and such a staff is not expected to be available in the future.

    Recommendation: The Mayor of the District of Columbia should bring the four bank accounts maintained for collection of delinquent payments into the District's cash management system under the control of the cash managers.

    Agency Affected: District of Columbia

 

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