March 13, 1991
TO: AUDIT COMMITTEE NO. 1-91
RE: Fiscal Year 1990 Audit Report and Management Letter
__________________________________________________________
Enclosed is the independent audit report prepared by
Deloitte and Touche on the Institute’s 1990 fiscal year. Also
enclosed is the auditor’s management letter discussing some
issues relating to the audit.
I would like to provide you with some additional informa-
tion on the issues contained in the management letter and our
course of action on each.
1. Routing of Vendor Invoices to Accounting
The auditors have recommended that all account payable
invoices be sent to the accounting department rather than to the
department for which the good or service is provided. Although
we are looking into this, we do not feel it is necessary. Our
present system works well and, in particular, gives the origina-
ting department the opportunity to verify the accuracy of the
invoice, to indicate what expense account the invoice should be
charged, and to have the charges approved by the department head
before it goes to accounting for payment.
The auditors have made this recomendation with the intent
that it will provide more control over accounts payables and will
help insure that outstanding invoices are paid on time. However,
that has not been a problem with us. The Institute has an
exemplary record of paying invoices on time and in the correct
amount.
2. Travel Expense Reimbursements be Properly Documented
We are in the process of releasing revised travel and
expense policies to the staff. These policies have been written
taking into account current Internal Revenue Service requirements
for documentation of travel and entertainment expenses.
3. Accounting Policies and Proedures Manual
One of our goals for this current fiscal year is to publish
formal accounting policies and procedures. This project has been
started by our Controller, and we anticipate the work will be
completed by the end of this fiscal year. The published document
will contain those items recommended by the auditors in the
management letter as well as other policies we feel are also
important.
Please let me know if you have any questions on either the
audit report or the management letter.
Thomas S. Simmons
Vice President - Administration
Enc.