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Sedgwick Risk Services on the behalf of the Office of Risk Management. BONDS, CRIME and PROPERTY. Revised 07/2015. BONDS AND CRIME. Does it apply to you?. WHO DOES THE PROGRAM APPLY TO?. Any agency that: owns property; has petty cash; receives funds; pays out funds; or
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Sedgwick Risk Services on the behalf of the Office of Risk Management BONDS, CRIME and PROPERTY Revised 07/2015
BONDS AND CRIME • Does it apply to you?
WHO DOES THE PROGRAM APPLY TO? • Any agency that: owns property; has petty cash; receives funds; pays out funds; or handles any other type of negotiables (e.g. bus tokens)
PROGRAM GOAL • To provide a comprehensive system of internal fiscal control as well as property control.
PURPOSE • Assign responsibility • Establish each employee’s accountability • Reduce the State’s exposure and losses and safeguard assets • Maintain public confidence • Protect assets from theft and robbery
HOW IS PREMIUM DETERMINED? • Agency’s “exposure” to risk • Frequency and severity of claims • Implementation of a Bonds/Crime Program
BONDS/CRIME COVERAGE • Fidelity Bonds - mandatory, as required by legislative auditor, with $1,000 deductible • Property Manager Bonds - mandatory, as required by statute, with $1,000 deductible
BONDS/CRIME COVERAGE (cont.) • Postal Bond – mandatory with no deductible • Notary Bond – mandatory, as required by revised statute, with $1,000 deductible
BONDS/CRIME COVERAGE (cont.) • Public Official Bond - mandatory with $1,000 deductible • Crime Policy-(inside/outside premises, money & securities, depositors forgery)- mandatory with $1,000 deductible
Conditions for Coverage • Money and securities must be kept in a safe when the custodian is not on the premises. • When transporting money and securities over $50,000, an armed escort recommended.
Condition for Coverage (cont.) • Armed escorts are recommended as follows: • one armed escort for up to $65,000 • two armed escorts for up to $85,000 • three armed escorts for up to $125,000 • OR contract an armored vehicle service
COMPONENTS OF PROGRAM Agency Policy and Procedures Each agency is responsible for developing and implementing a written program
COMPONENTS OF PROGRAM (cont.) Agency Policy & Procedures Must: • Designate “responsible” employees • Provide Training for “responsible” employees • Provide for regular program audits • Delineate investigation procedures
COMPONENTS OF PROGRAM (cont.) • Policies must address: • Responsibilities and accountability • Communication/organization • Training • Accident Analysis • Loss Prevention Audits/CRs & Recordkeeping
RESPONSIBILITIES • Sedgwick - will assist agencies in organizing, directing, implementing and controlling an internal fiscal control program
RESPONSIBILITIES (cont.) • Department and Agency Heads • implementation of program • reviewing the program regularly • reviewing ORM audit/CR findings and implementing the recommendations
RESPONSIBILITIES (cont.) • Supervisors • ensuring employees are trained and training is documented • ensuring safeguards are followed • reviewing the program for protection of the State’s assets and property from losses
RESPONSIBILITIES (cont.) • Employees • following the fiscal control program • reporting discrepancies or problems to their supervisors
INTERNAL CONTROL PROCEDURES • Each agency should establish a system of internal accounting and administrative controls
INTERNAL CONTROL PROCEDURES (cont.) • Reasonable assurance • Attitude • Competent personnel • Documentation including recording transactions • Internal control objectives
INTERNAL CONTROL PROCEDURES (cont.) • Obligations and costs comply with applicable state law - State contracts - Bid process
INTERNAL CONTROL PROCEDURES (cont.) • Safeguard funds, property, & other assets against waste, loss, unauthorized use or misappropriation
INTERNAL CONTROL PROCEDURES (cont.) • Procedures for: • locking and unlocking of buildings • security systems • procedures used throughout the day • computer security
INTERNAL CONTROL PROCEDURES (cont.) • Procedures to safeguard against damage to property: - employee/student accountability for equipment and property - devices to prevent damage
INTERNAL CONTROL PROCEDURES (cont.) • Procedures to safeguard against losses: - security of cash, checks, stamps - equipment check-in and-out & security - collections from stadiums, dormitories, & other fees etc.
INTERNAL CONTROL PROCEDURES (cont.) • Procedures to safeguard against unauthorized use or misappropriations: - computer use agreements - internet use agreements - equipment use agreements (e.g. TV/VCR, camera, vehicle) - funds including petty cash
INTERNAL CONTROL PROCEDURES (cont.) • Revenues and expenditures are recorded and accounted for.
INTERNAL CONTROL PROCEDURES (cont.) • Separation of duties • Supervision • Access to resources • Address audit findings