6.4.9 Procedural Reviews
Procedural reviews of locations are not financial audits. Procedural reviews are ordered by the Audit Committee according to the Audit Committee's timetables. They are intended to identify which internal procedures are being met and which procedures require attention. Procedural reviews assist locations in addressing financial and operational procedures so that the requirements of internal controls and proper financial oversight are met.
To initiate a procedural review, the Archdiocesan Catholic Center (ACC) will provide the location with a Self-Assessment Internal Control Questionnaire (ICQ), as applicable. See the Parish Self-Audit Checklist, the School Self-Assessment Internal Control Questionnaire, and the Scrip Self-Assessment Internal Control Questionnaire. The ICQ must be completed and provided to the auditor conducting the review before a mutually scheduled on-site visit. During the on-site visit, the auditor tests internal controls. Specific records must be maintained and provided for these reviews.
The following areas will be tested during a procedural review:
Receipts (i.e., the receipt book, cash log/register, deposit slips, bank statements, contributions, special collection records, and tuition records)
Disbursements (e.g., check registers, credit card statements, bank statements, and invoices)
Scrip
Budgets and financial statements; bank reconciliation records
The current listing of tuition and fees
Finance Council minutes
Payroll records
Physical security and electronic security systems
Capital campaign and significant contractual obligations
6.4.9.1 Review Format
During a location visit, the auditor conducting the review observes, inquires about, and performs tests of internal controls and reviews the completed ICQ with the location.
Based on the findings, the auditor prepares analyses and comments, and collects samples of documentation prepared by the location as necessary. Preliminary review findings are documented, discussed with the person in charge, and confirmed.
The auditor then incorporates the results of the standard ICQ in the evaluation, reviews the completed work, and issues a report of the findings to the location or other requesting party and to the Financial Services Group and the Audit Committee.
The regional bishop is involved in the process when significant issues are identified, when the review was initiated at the regional bishop's request, or when circumstances require. As appropriate, the Archdiocesan Catholic Center, or the moderator of the curia, may initiate further investigations or follow-up procedures or actions, including staff discipline and reports to law enforcement.
6.4.9.2 Physical Assets and Inventory
Proper internal controls include controlling physical assets at the location. Records of these items are extremely important in the event of a fire or another loss.
Every location needs to maintain and annually update an inventory of property with a value greater than $500 or a life expectancy of five years or longer. The inventory should include all personal property in the parish, rectory, offices, school, and other facilities, such as equipment, furniture, and materials (under "Written Hazard Communication Program," see Chemical Inventory and Safety Data Sheets).
Locations should be particularly attentive to items that have significant value as works of art, such as statues, paintings, altar furnishings, relics, chalices, tabernacles, candlesticks, books, vestments, and musical instruments. Such items may require additional fine arts coverage under Archdiocesan Insurance Programs.
6.4.9.3 Important Papers
Every location should store its important papers in a secure fire-resistant vault or other space.
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