How Can My Department Contribute to the University’s Control Environment?
The control environment is the control consciousness of an organization; it is the atmosphere in which people conduct their activities and carry out their control responsibilities. An effective control environment is an environment where competent people understand their responsibilities, the limits to their authority, and are knowledgeable, mindful, and committed to doing what is right and doing it the right way. They are committed to following an organization’s policies and procedures and ethical and behavioral standards.
As a Business Administrator/manager/employee of a department, you can do the following to enhance your department’s control environment:
- Make sure job descriptions exist, clearly state responsibility for internal control, and correctly translate desired competencies.
- Implement segregation of duties where duties are divided, or segregated, among different people to reduce risk of error or inappropriate actions. No one person has control over all aspects of any financial transaction.
- Make sure transactions are authorized by a person delegated approval authority when the transactions are consistent with policy and funds are available. [Make sure authority levels in Privilege Management system are appropriate and accurate.]
- Ensure records are routinely reviewed and reconciled by someone other than the preparer or transactor, to determine that transactions have been properly processed. [Make sure the MD091 review and reconciliation is performed and the Edog sign-off is completed.]
- Make certain that equipment, inventories, cash and other property are secured physically, counted periodically, and compared with item descriptions shown on control records.
- Provide employees with appropriate training and guidance to ensure they have the knowledge necessary to carry out their job duties, are provided with an appropriate level of direction and supervision, and are aware of the proper channels for reporting suspected improprieties. For example, if your department is a recipient of sponsored funds, make sure that individuals administering funds are well trained on federal rules and regulations regarding the use of grant funds.
- Make sure University and departmental level policies and operating procedures are formalized and communicated to employees. Documenting policies and procedures and making them accessible to employees (in either hard copy or internet based form) helps provide day-to-day guidance to staff and will promote continuity of activities in the event of prolonged employee absences or turnover.
- Make sure that employees comply with the VU Conflict of Interest Policy and disclose potential conflicts of interest.
- Make sure employee performance evaluations are conducted periodically. Good performance should be valued highly and recognized in a positive matter.
- Make sure that appropriate counseling and/or disciplinary action is taken when an employee does not comply with policies and procedures and/or behavioral standards.