4.2.2 Account Reconciliation and Segregation of Duties Monitoring and Training
A. Purpose
To define the process by which (1) accounts are reconciled in a timely manner, (2) adequate segregation of duties are in place to maintain appropriate internal controls, and (3) records are maintained for review and/or audit.
B. Persons Affected
All University of Texas at Tyler (the "University") staff involved in any aspect of the account reconciliation process, beginning with an initial request for goods and/or services and ending with the final certification of the reconciliation of accounts.
C. Definitions
- Segregation of Duties (SoD) – the concept of having more than one person required to complete a task. Sometimes referred to as Separation of Duties.
- SoD is a key concept of internal controls designed to increase protection from fraud and errors.
- SoD is achieved by disseminating the tasks and associated privileges for a specific business process among multiple users.
- Budget authority – An employee of the University who has been delegated primary signature authority of an account for the purpose of approving the procurement of goods and/or services on behalf of the University.
- Monitoring Department – The appropriate department responsible for monitoring account reconciliations and providing training and assistance to budget authorities and reconcilers. For the Health Science Center at UT Tyler, the Budget and Financial Planning department is the Monitoring Department. For all other campuses, the Accounting and Financial Reporting department is the Monitoring Department.
D. Policy
It is the policy of the University to monitor its departmental account reconciliation and segregation of duties and to provide training and tools to individuals involved in the account reconciliation process.
Enforcement Mechanisms
All budget authorities are responsible for enforcing this policy. Individuals who violate this policy are subject to the appropriate and applicable disciplinary process, up to and including termination.
The Monitoring Department monitors Account Reconciliation and provides training and assistance to budget authorities and other department personnel as requested.
Non-compliance can be reported on a monthly basis, but no later than a quarterly basis, to the Chief Financial Officer (CFO), the Chief Audit Executive, and the Executive Director of Compliance. The manager or director of the Monitoring Department is responsible for working with the appropriate departmental personnel and Vice Presidents to correct deficiencies and reporting of non-compliance to the CFO. The CFO is responsible for reporting unresolved deficiencies to the Executive Cabinet.
Compliance
As per UT System Accounting Policy UTS142.1, Budget authorities are required to complete a year-end certification that all accounts under their authority have been reconciled. The approved form for this certification is a UT System standard form titled "Certification Letter to the Financial Reporting Officer". The certification letter is to be completed and returned to the CFO.
Compliance Goal: 100% of accounts to be reconciled according to the schedule outlined below.
Account reconciliation due date:
- All accounts should be reconciled on a monthly basis.
- The due date for monthly account reconciliations is communicated to the campus by the Monitoring Department.
Records Retention
Departmental Account Reconciliations and all related supporting documents and reports shall be retained in the subject department for the current fiscal year, plus three (3) additional fiscal years. Account Reconciliation records will be subject to review and/or audit during the retention period.
E. References
The University of Texas System Accounting Policy, UTS142.1