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REPORT TO MANAGEMENT (Continued) II. CURRENT YEAR FINDINGS AND RECOMMENDATIONS (Continued) OTHER MATTERS Develop and distribute employee manual Observation: We noted that the Town does not have a personnel manual and that some employees were not familiar with some basic Town personnel policies and procedures. We recommend that an employee or personnel manual be developed, distributed to employees, and periodically updated as necessary. A comprehensive and up-to-date personnel manual can help communicate, and encourage adherence to, Town policies; prevent possible confusion or misunderstandings among personnel; and provide a measure of liability protection to the Town in case of employee legal challenges of Town actions. Recommendation: We recommend that the Town have its legal COIJ3eVi..e. w a draft of the handbook before it is distributed to employees. t' .. Manaaement response: Management concurs with the((;ec mendatia II. PRIOR YEAR FINDINGS AND RECOMMENDATIONS SIGNIFICANT DEFICIENCIES '" ~ . Organization structure ~) V Observation: The size of the Town's a nt nd administrative staff precludes certain basic internal controls that would be preferred if the st e er and more segregation of duties could be achieved. If cost-effective to the operations, existing internal controls' t im the following practices should be implemented to improve fficiency: Internal controls are responsible for en be rotated from ti e-t iv hen the bank reconciliations are prepared by someone not eipt and disbursement records. We recommend bank reconciliation duties ugh the Town's accounting and administrative personnel. signed disbursement checks are customarily returned for mailing to the accountant who prepar the checks. Controls over disbursements would be improved if all disbursement checks were transm itted after signature directly to the mail clerk or another individual who is independent from cash disbursement, cash receipting and general ledger funds. The above-mentioned items require that the Commission continue to be significantly involved in the operations of the Town to provide oversight and an independent review function. Recommendation: We recommend that the Town develop an organization chart and an accounting policies and procedures manual. Current vear status: The organization chart is in place and the accounting policies and procedures manual will be finalized later in 2009. The comment will be repeated in the current year. 30