To reduce duplicate expenditure tracking and increase the effectiveness of its budget process, the department should develop procedures requiring the districts to prepare and submit spending plans and to periodically submit their total expenditures after reconciling them with the FTS. The procedures should specify how often districts should provide this information to the department to ensure that the budget office and park management can appropriately oversee the districts' budgets and spending.
The Department reduced its duplicate expenditure tracking and increased the effectiveness of our budget process by developing procedures requiring the district offices to prepare and submit spending plans by submitting their total projected expenditures after reconciling with FTS. The attached procedures specify how often the districts should provide this information to headquarters to ensure that the budget office and park management can properly oversee the district office's budgets and spending. Attachment B shows a screenshot showing the input module for Reporting and Adjustments to Expenditure Projections. Attachment C "Projections Database - Access and Instructions" was implemented Feb 29, 2016.
Actions have been taken to start development and implementation of an Expenditure/Projections screen in the Department's Fiscal Tracking System. This would be a tool for the districts and headquarters to review actual and projected expenditures. The tool will allow districts to make changes to formula-driven projected expenditures to reflect changing operations, and will thus reduce duplicative projection efforts. This tool will be accessible via the internet to relevant employees throughout the Department. This will also allow the Budget Office to hold monthly conversations with the districts about their expenditures and will shift ownership of projections to the districts themselves. Once developed, procedures will be developed for the districts on how to use the new screen and what information will need to be input. There will also be procedures in place for the Budget Office on what information to look for and how to properly analyze the information.
Fund Reconciliation Guide
Although the department's response states that it has taken steps to start development and implementation of a tool to reduce duplicative projection efforts, its response also indicates that it has not yet completed the tool and procedures for the districts. We look forward to reviewing the documentation once the department completes the tool and related procedures.
The Districts' projections and tracking is not duplicative but rather a necessary tool. It is similar to tracking a personal checking account with a checkbook register instead of relying on the bank to know your account balance. Districts make sure invoices are not lost, that are mailed to headquarters, by checking the system for payment. Headquarters would not be able to check for a missing invoice because they don't know what the districts have sent. Together both the Districts and the Budget Office projections start the conversation between offices and provide Executive Staff information to make informed decisions.
The department has misunderstood our recommendation. We agree with the department's response that district projections and tracking is not duplicative. As we describe on page 23 of the audit report, the department's efforts duplicate work performed at the district level. Therefore our recommendation was directed to reduce the duplicate expenditure tracking occurring at the departments and to develop a process and procedure that require a consistent method for districts to prepare documents and submit them to the budget office for oversight purposes.
At the close of the first quarter of each Fiscal Year beginning in Fiscal Year 2014-15, and monthly thereafter, the budget analysts will contact the District Superintendents in each of the Departments Districts to discuss budget-to-actual expenditures and target-to-actual revenue. The analysts will also work with the District Superintendents to prepare both expenditure and revenue projections for the upcoming quarter. This same discussion will occur with the Deputy Director of each Division within the Department.
After the close of the first quarter of each Fiscal Year, and monthly thereafter, the Budget Officer will prepare a budget-to-actual expenditure and target-to-actual revenue report for review by the Executive Staff at the regularly scheduled Executive Staff Meeting. The Budget Officer will compile expenditure and revenue projections from information provided from the Budget Analysts.
Although the department has stated its intent to require discussions between the budget analysts and district superintendents, the department has not yet provided the procedures that it plans to have the districts follow to reduce duplicate expenditure tracking and increase the effectiveness of the budget process.
The Budget Section has prepared draft procedures to reconcile expenditures with the various divisions in the Department and to report monthly to the Department's Executive Management Team. The draft procedures are in comment phase now.
Although the department has developed draft procedures to reconcile expenditures and report monthly to its executive management team, its draft procedures do not address key aspects of our recommendation. For example, our recommendation states that the procedures should require the districts to prepare and submit spending plans, but the department's draft procedures do not mention spending plans or anything similar. Rather the department's draft procedures require a discussion of budget to actual expenditures and revenues between budget analysts and district superintendents. We would have expected the department to develop a procedure that outlines a consistent process for districts to develop and submit spending plans which the budget analysts could then review and approve to provide oversight of district expenditures.
Agency responses received are posted verbatim.