Baltimore, MD - Two new audits, a Department of Public Works (DPW) Biennial Financial Audit and an independent report concerning Department of Finance (DOF) unidentified receipts were presented to the Board of Estimates this week at its June 15th meeting.

Concerning DPW’s biennial financial report, the Department of Audits (DOA) determined that the agency must modernize and update its payroll, internal payment and purchase order practices. The audit covers fiscal years 2020 and 2019.

According to the audit, DPW was not able to provide documentation for selected FY 2020 payroll activities for testing nor demonstrate if payroll was recorded accurately. Of the selected payroll material surveyed, 47 percent were missing timesheets and 26 percent were missing approval for overtime, compensatory time or leave.

The audit also found that DPW did not properly track the finances for its Internal Service Fund (ISF), which is used to track goods and services provided to other city agencies. In a third finding, DOA noted that DPW had Purchase Orders that were not closed by FY 2020, due to both system and agency issues.

DPW concurred with DOA’s finding and agreed to:

•  Make the shift to Workday for payroll processing, and to work with Human Resources to make any necessary modifications to how it executes payroll. Workday will also help with managing any open Purchase Order issues.
• No longer manage its Internal Service Fund, having already shifted that responsibility to the Department of General Services in 2020.

Unidentified Receipts

For the DOF, Audits sought to identify problems with receipts that represent money paid to the City from various sources that the Bureau of Accounting and Payroll Services (BAPS) does not know what account it should be posted to. Until the revenue is posted the amount is shown as a City liability.

DOA selected 60 unidentified receipts totaling $16.5 million or about 46 percent of the $35.9 million in total unidentified receipts recorded by DOF. Audits identified appropriate records for 49 unidentified receipts, while the other 11 (totaling $938,000) remained unidentified.

Root causes for unidentified receipts include a lack of proper recording, employee learning curves and slow response times from agencies. Finance agreed to DOA’s recommendations and among other actions will continue its fiscal migration to Workday.

“I’m glad that our agencies are eager to start using Workday to better track payroll, receipts and other fiscal responsibilities, but it’s not a cure-all,” Comptroller Bill Henry said. “Any tool is only as good as the person using it. We’re going to want to see progress on that front in future audits.”

The audit reports can be found on the Comptroller's website.