Reconciliation and division of duties

Reconciliation

One of the many tasks that the finance department must perform every day is to count the remaining cash in the office and balance it against the book value of accounts; this is a critical step in order to know precisely how much money the USA Pavilion has, because the account balance that can be checked electronically only tells part of the story. As soon as cash is dispersed to a person or department, the value muse be recorded and subtracted from the previous total to calculate the current balance. For example, if the Dance America department needs 400 RMB to pay for some special fabric for a costume, the department head will come to the finance department and explain it; we will then either advance the money or instruct him to prepay and submit an expense report for reimbursement. If the money is to be prepaid, we make a note in the journal and have the department representative write a letter with details for us to keep on file. If a shipment of office supplies arrives at the USAP, it will most likely already have been paid for; if not, the deliverer submit’s the invoice and we disperse cash accordingly. In June, we had a problem with one of the printers that Dell donated to us, so the IT department head received an advance payment to use on a new printer from Best Buy. We recorded both the initial payment to him and the refund of change when he returned. Most computer parts have been purchased using this method of payment, though several times we had to reimburse various IT department employees for their purchases.

Other than equipment purchases and expenditure reimbursement, we also must record the payment of stipends to the student ambassador employees and the Chinese volunteers who represent our pavilion and are not paid by direct deposit like other staff members. The fact that the stipends are all paid in Chinese RMB notes complicates the reconciliation process in two ways: first, the estimated amount of expense reimbursements and student stipends must be withdrawn from the bank weekly and second, three student ambassadors are authorized to disperse the funds.

On Mondays, the supervisor of our student ambassadors and volunteers prepares the payroll spreadsheet that compiles names and payroll amounts, and subtracts penalties based on absences/late arrivals. Once we have that list, we combine the amount of cash on hand with the estimated expenses to reimburse and the payroll amount to students, and then we know how much to withdraw from the bank. Although most of this passes through our hands, the final review and approval of our CFO and/or his assistant are required to make out the withdrawal slip for the bank. Two of the finance department’s student ambassadors would ride to the bank, withdraw the money, and return to the pavilion to begin dispersing stipends for the day. That is when the second problem arises: 3 different people are authorized to give out stipends, so each must know what the others have done and the job must be coordinated to ease reconciliation at the end of the day. We must 1) count the cash into equal stipend payments, 2) ask the student to recount and sign in their designated signature column 3) sign our own names and record date dispersed in their designated columns. If several students arrive at once, as they often do, it can be very distracting and sometimes a signature or date can be omitted. Although the students arrive to collect their stipends during their breaks, we must be sure to remember not to allow the student ambassadors to rush us into making mistakes. This last issue has caused some problems with recording that have led to frantic calls to students asking if they forgot to sign and leaving work late because we couldn’t figure out why the numbers were wrong. There was a day when two of the students in the finance department calculated large discrepancies, and for 3 days there was no solution; we spent hours watching video surveillance of every place the money had been, recounted the cash and all of the week’s reimbursements several times, but at last it was clerical error that had resulted in the miscalculation and there was no actual missing money. This is a lesson in the importance of separation of duties and responsibilities in the workplace, even within a single department.

VIK: DELL

Dell is an American corporation that is a favorite supplier of computers and information technology-related equipment to many different institutions around the world. It is from Dell that schools like the University of Memphis supply all of their PC needs, and many other schools also fill their need for equipment through it. Dell's representatives approved the proposal to be one of the sponsors the USA pavilion, so our sponsorship negotiators drew up a contract and Dell decided on an amount to give that was to be divided between VIK goods and cash donations. The VIK goods donations included the equpiment used in our office, such as printers, laptops, desktops, monitors, and all manner of accessories for each. In a small office on the bottom floor of the USAP is the server office, in which there are more Dell donations like gigantic servers, accessories, monitors, desktops, and more laptops. These servers enable several different mobile desktop applications, such as enabling the access of files that people can save on one computer and access from another, applications such as Microsoft Office 2010, and many other network functions.

Each of many deliveries to our pavilion was documented by Dell and sent with delivery documentations like invoices, receiving sheets, etc. Unfortunately, they were delivered before we had a department dedicated to recording the receipt of these goods and filing these invoices. When I began to explore the Dell case, and since then, the only invoices given to me were several months old and only covered 12 out of 26 different deliveries. This led to obvious difficulties for me and potential danger for those in our pavilion who would be vulnerable and responsible for any auditing discrepancies. Lucky for us, we have a responsible and knowledgeable contact on the Dell side; this contact gives us all the records from their side, usually an updated Excel spreadsheet with extensive amounts of information. Some of this information includes cumulative unit delivery totals by unit, dates they were delivered, market value of each, Dell's profit margin, total prices for market values and the amounts Dell has spent in both RMB and USD. This is really the only way for us to verify how much we have received, given the fact that almost every department needs computers: the employee staff room has 2 desktops, the bar has 2 laptops, VIP reception department has several at each of its desks, sponsorship department needs them, IT department, communications, protocol, not to mention all of our supervisors and of course our commissioner general. The emailed spreadsheet is not enough, however; we need surveys conducted by the IT department to find out exactly where each of the delivered devices are. Comparing each document to each other and the scarce receiving documents, we can thus develop ample proof against any accusation of fraud and have all necessary proof ready to deliver to auditors when they arrive.