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B-164031 1 (1970-10-27)

handle is hein.gao/gaobabkue0001 and id is 1 raw text is: COMPTROLLER GENERAL OF THE UiITED STATES WASHINGTON DC 20548 OCT 27 1970 RESTRICTFM ft ot o he released outside th- General B-164031 Accolu t g I _', e c - e basis of 3 c ,c approval by the of: e s LEg at;ve L aeon, a rc - which is kept by the DistD ,vuon Section, Publications Btanch, OAS Dear Senator Goodell RELEASED This letter is in response to your August 1970 ri e-- concerning the progress of the Department of Health, Education, and Welfare in correcting payroll procedures which permitted overpayments of salaries as well as other payroll weaknesses. The news items enclosed with your request apparently relate to findings commented on in our report to the Congress on need for improvements in the automated central payroll system of the Department of Health, Education, and Welfare (B-164031, January 17, 1969). A copy of this report is enclosed. Your inquiry Indicates special interest with respect to corrective actions on checks issued either in wrong amounts or to persons not entitled to payments. We reported that five former employees had cashed salary checks to which they were not entitled, amounting to $7,411. By September 1, 1970, the Department had collected $6,654 of these overpay- ments. We also noted that 1,451 Government paychecks amounting to $288,233 had been returned to the Department by the payees or the agents designated to handle paychecks because the checks had been issued erro- neously, and that 89 checks amounting to $15,757, representing refunds from overpaid employees, had been received by the Department. The report showed that the overpayments and the payments to wrong parties were part of a pattern of weaknesses in payroll processing which included errors in computing employees' earnings, leave, and pay- roll deductions, errors in issuing savings bonds; delays in forwarding to other agencies amounts withheld from salaries; and the retention for periods as long as 2 years of cash and checks in an unlocked file drawer Among the improvements that we believed to be needed were (1) effective controls over checks, cash documents, and magnetic tapes, (2) use of pre- determined control totals, programmed controls, and system documentation; (3) revised instructions to assist clerks in applying pertinent payroll laws and regulations; and (4) more effective supervision of payroll activities. The Department has initiated action to correct the errors and to collect the overpayments cited in our report. In addition, a depart- mental task force--consisting of systems, programming, accounting, and other management specialists--has been assigned to redesign the payroll system to ensure the accuracy of future payrolls. The Department has

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