HomeMy WebLinkAboutFS 2013-11-19 Item 2G - Discussion - Voucher Review and Approval by CouncilCity of Tukwila
TO:
Jim Haggerton, Mayor
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Mayor Haggerton
Finance and Safety Committee
FROM: Peggy McCarthy, Finance Director
DATE: November 13, 2013
SUBJECT: Voucher Review and Approval by Council
ISSUE
Clarify Council responsibilities for voucher review and approval.
BACKGROUND
It has been the Council's practice to have one Council member, selected on a rotating basis, review
and approve vouchers as a precursor to full Council approval before release of checks for payment.
A question arose recently as to the Council's legal requirements in this regard.
Pursuant to RCW Chapter 42.24 and the Washington State Auditor's office Budget Accounting and
Reporting system (BARS) manual, 7l/8 the governing body's responsibility to ensure that the system
Of auditing and certifying vouchers is operating in a manner to provide the greatest possible
protection for the governing body members and the municipality". Additionally, the Council is
obligated to indicate approval for payment of claim vouchers and have such approval entered into
the minutes along with the voucher or check numbers and the total amount of the claims. An excerpt
from the BARS manual and selected RCW's from Chapter 42.24 are attached to this memo.
The City's financial management system has several procedural checks and balances in place to
provide protection to the City and assure that, for all claims presented for payment and before a
disbursement is actually made,
• the materials have been furnished,
• the services have been rendered,
• the claim is a just, due and unpaid obligation of the City, and
• the claim is assigned an account number(s) consistent with the City's chart of accounts and
compliant with BARS.
The procedural checks and balances include review and approval by the initiating department
director, the Accounts Payable Fiscal Specialist, the Accounts Payable Fiscal Coordinator and the
Finance Director. The vouchers and supporting documents are reviewed for connp|eteneaS,
approvals, account coding and compliance with established policies and procedures and other
relevant matters.
DISCUSSION
The level of review required by Council to fulfill their obligations and render voucher approval is a
matter of judgment and depends largely on the degree of confidence placed in the financial
management system and its controls. A comprehensive review of the City's procurement policy and
procedures is planned for 2014; the voucher approval and certification process will be re-addressed
then.
RECOMMENDATION
For information only.
ATTACHMENTS
BARS manual excerpt, Accounting - Expenditures - Voucher Certification and Approval
RCW 42.24.080, RCW 42.24.090, RCW 42.24.115
92
ACCOUNTING
Expenditures
Voucher Certification and Approval'
All claims against a municipality must be preaudited by the auditing officer of the municipality or his/her
delegate. In addition, all claims must be certified by the auditing officer. This certification may be made
on each individual claim voucher or, subject to the acceptance and approval of the municipal legislative
body, a blanket voucher certification may be used so long as it indicates the particular vouchers so
certified. The use of a blanket certification in no way relieves the auditing officer of his /her responsibility
and liability for each individual voucher so certified. The certification is required regardless how the
transaction is processed (i.e., through warrants, checks, EFTs, etc.). The certification must be signed and
dated by the auditing officer or his /her delegate. For all claims, except expense reimbursement claims
certified by officers or employees (see Employee Travel), the certification must include the following
language:
I, the undersigned, do hereby certi under penalty of perjury that the materials have
been furnished, the services rendered or the labor performed as described herein, that
any advance payment is due and payable pursuant to a contract or is available as an
option for full or partial fulfillment of a contractual obligation, and that the claim is a
just, due and unpaid obligation against the (city /county /district), and that I am authorized
to authenticate and certify to said claim.
The auditing officer's certification for employee /officer expense reimbursement claims must include the
following language:
I, the undersigned, do hereby certibr under penalty of perjury that the claim is a just, due
and unpaid obligation against the (city/county/district), and that I am authorized to
certifir to said claim.
The certification by the auditing officer in no manner relieves members of the governing body from the
responsibility and liability for each voucher approved. It is the governing body's responsibility to ensure
that the system of auditing and certifying vouchers is operating in a manner to provide the greatest
possible protection for the governing body members and the municipality.
To indicate governing body approval for payment of claim vouchers and payroll, the following should be
entered in the minutes:
The following voucher /warrants are approved for payment:
(Funds)
Voucher (warrant)
numbers: through $
Payroll warrant /transaction
numbers: through $
' Chapter 42.24 RCW
Total
93
If the legislative body authorizes the procedure, cities, counties and districts may issue warrants before
the legislative body approves claims. To do this the municipality must enact the following policies and
procedures (required in Chapter 42.24 RCW):
(1) The auditing officer and the officer designated to sign the checks or warrants must have an
official bond. The amount should be determined by the legislative body but cannot be less than
fifty thousand dollars (RCW 42.24.180);
(2) The legislative body should adopt contracting, hiring, purchasing, and disbursing policies that
implement effective internal control;
(3) The legislative body must review and approve the claims paid at its next regularly scheduled
public meeting, or for cities and towns, at a regularly scheduled public meeting within one month
from issuance; and
(4) If the legislative body disapproves some claims, the auditing officer and the officer designated to
sign the checks or warrants must recognize these claims as receivables of the taxing district and
pursue collection diligently until the amounts are either collected or the legislative body is
satisfied and approves the claims.
The legislative body may stipulate that certain kinds or amounts of claims should not be paid before the
board has reviewed the supporting documentation and approved the issue of checks or warrants in
payment of those claims.
The original copy of all vouchers should be filed in the office of the auditing officer of the municipality.
The detailed accounts to which the expenditures are to be posted must be clearly designated. Supporting
documentation must be retained and either attached to the vouchers or canceled by the auditing officer to
prevent reuse. See Original Supporting. Documentation for information regarding original supporting
documentation.
Districts that do not issue their own warrants should send either original vouchers or other supporting
documentation (e.g., listing of approved vouchers, etc.) to the county auditor.
94
RCW 42.24.080: Municipal corporations and political subdivisions — Claims against for ... Page 1 of 1
RCW 42.24.080
Municipal corporations and political subdivisions — Claims against
for contractual purposes — Auditing and payment — Forms —
Authentication and certification.
(1) All claims presented against any county, city, district or other municipal corporation or political
subdivision by persons furnishing materials, rendering services or performing labor, or for any other
contractual purpose, shall be audited, before payment, by an auditing officer elected or appointed
pursuant to statute or, in the absence of statute, an appropriate charter provision, ordinance or
resolution of the municipal corporation or political subdivision. Such claims shall be prepared for audit
and payment on a form and in the manner prescribed by the state auditor. The form shall provide for
the authentication and certification by such auditing officer that the materials have been furnished, the
services rendered, the labor performed as described, or that any advance payment is due and payable
pursuant to a contract or is available as an option for full or partial fulfillment of a contractual obligation,
and that the claim is a just, due and unpaid obligation against the municipal corporation or political
subdivision. No claim shall be paid without such authentication and certification.
(2) Certification as to claims of officers and employees of a county, city, district or other municipal
corporation or political subdivision, for services rendered, shall be made by the person charged with
preparing and submitting vouchers for payment of services. He or she shall certify that the claim is just,
true and unpaid, and that certification shall be part of the voucher.
[2008 c 198 § 6; 1995 c 301 § 72; 1965 c 116 § 1.]
Notes:
Finding -- 2008 c 198: See note following RCW 39.34.030.
http: // apps .leg.wa.gov /rcw /default.aspx ?cite= 42.24.080 11/13/2013 95
RCW 42.24.090: Municipal corporations and political subdivisions — Reimbursement cla... Page 1 of 1
RCW 42.24.090
Municipal corporations and political subdivisions —
Reimbursement claims by officers and employees.
No claim for reimbursement of any expenditures by officers or employees of any municipal corporation
or political subdivision of the state for transportation, lodging, meals or any other purpose shall be
allowed by any officer, employee or board charged with auditing accounts unless the same shall be
presented in a detailed account: PROVIDED, That, unless otherwise authorized by law, the legislative
body of any municipal corporation or political subdivision of the state may prescribe by ordinance or
resolution the amounts to be paid officers or employees thereof as reimbursement for the use of their
personal automobiles or other transportation equipment in connection with officially assigned duties and
other travel for approved public purposes, or as reimbursement to such officers or employees in lieu of
actual expenses incurred for lodging, meals or other purposes. The rates for such reimbursements may
be computed on a mileage, hourly, per diem, monthly, or other basis as the respective legislative
bodies shall determine to be proper in each instance: PROVIDED, That in lieu of such reimbursements,
payments for the use of personal automobiles for official travel may be established if the legislative
body determines that these payments would be less costly to the municipal corporation or political
subdivision of the state than providing automobiles for official travel.
All claims authorized under this section shall be duly certified by the officer or employee submitting
such claims on forms and in the manner prescribed by the state auditor.
[1995c301 §73; 1981 c56§ 1; 1965c 116 §2.]
96 http: // apps .leg.wa.gov /rcw /default.aspx ?cite= 42.24.090 11/13/2013
RCW 42.24.115: Municipal corporations and political subdivisions — Charge cards for of... Page 1 of 1
RCW 42.24.115
Municipal corporations and political subdivisions — Charge cards
for officers' and employees' travel expenses.
(1) Any municipal corporation or political subdivision may provide for the issuance of charge cards to
officers and employees for the purpose of covering expenses incident to authorized travel.
(2) If a charge card is issued for the purpose of covering expenses relating to authorized travel,
upon billing or no later than thirty days of the billing date, the officer or employee using a charge card
issued under this section shall submit a fully itemized travel expense voucher. Any charges against the
charge card not properly identified on the travel expense voucher or not allowed following the audit
required under RCW 42.24.080 shall be paid by the official or employee by check, United States
currency, or salary deduction.
(3) If, for any reason, disallowed charges are not repaid before the charge card billing is due and
payable, the municipal corporation or political subdivision shall have a prior lien against and a right to
withhold any and all funds payable or to become payable to the official or employee up to an amount of
the disallowed charges and interest at the same rate as charged by the company which issued the
charge card. Any official or employee who has been issued a charge card by a municipal corporation or
political subdivision shall not use the card if any disallowed charges are outstanding and shall surrender
the card upon demand of the auditing officer. The municipal corporation or political subdivision shall
have unlimited authority to revoke use of any charge card issued under this section, and, upon such
revocation order being delivered to the charge card company, shall not be liable for any costs.
[1995 c 30 § 3; 1984 c 203 § 5.]
Notes:
Findings -- 1995 c 30: See note following RCW 43.09.2855.
Severability -- 1984 c 203: See note following RCW 35.43.140.
http: // apps. leg .wa.gov /rcw /default.aspx ?cite= 42.24.115 11/13/2013 97