1. Certification of Internal Controls Over the Payment Process
Presented by OSC:
Linda Herald, CIA, CGAP;
Casey Horton;
Bernard J. McHugh, CPA, CISA;
Joseph Motzer; Holly Reilly, CPA, CIA;
Christina Teator, CPA, CFE
Special Guest:
Jennifer O’Neill
New York State Archives

2. Agenda Requirement Background 2017 Results 2018 Requirement

3. Overview of Requirement
State Finance Law Section 110
Certification or approval of vouchers shall be made by the head of the department, or by those designated by the head of the department to do so.
The heads of the commissions, divisions and offices within the executive department shall be treated as department heads.

4. Overview of Requirement
NYCRR Title 2, Chapter I, Part 6.6
Agency head must submit an internal controls certification to OSC certifying their agency has established such a system of internal control over the payment process.
Maintain adequate internal controls over the payment process to support the validity of the agency claim certification for processing payments.
Required certification annually or upon change of the agency head.  

5. Importance of Controls over Payment Processes
Support certification of payments as being just, true and correct.
Reduce improper payments.

6. Annual Requirement Certification Form due on or before April 30th:
Agency head required to submit the annual certification.
Agency head may also be required to assess the internal controls for one or more particular areas each year.
Maintain documentation to support assessment of controls over the payment process.

7. Certification Resources
Guide to Financial Operations (GFO) XII.4.D contains:
Frequently Asked Questions
Internal Control Assessment Programs

8. 2017 Requirement Certify internal controls over the payment process
Assess controls over receiving

9. 2017 Results 74 % Satisfactory 25% Satisfactory with Weaknesses
1% Unsatisfactory
Sample Testing
Satisfactory
Satisfactory with Weaknesses

10. Best Practices One certification form submitted per BU
Documentation to consider maintaining:
Methodology to support sample size
Testing steps
Summary of testing results
Recommendations
For corrective action plans:
Control weaknesses identified
Corrective action plan/compensating control
Implementation date

11. 2018 Requirement Certify internal controls over the payment process.
Assess controls over obtaining and retaining records to support payments.
Form due on or before April 30, 2018.
Provide back-up documentation as requested from OSC.

12. 2018 Requirement
Objective: To ensure the agency obtained and retained sufficient, appropriate original source documentation to support claims for payment.

13. 2018 Requirement
Determine if the agency has adequate processes to obtain sufficient, appropriate evidence to provide reasonable assurance vendor performance complied with deliverables.
Determine if the agency ensures protection, authenticity, reliability, integrity, and usability of imaged records.
Determine if the agency maintained the supporting documentation for the time frames consistent with State records retention laws.

14. 2018 Requirement GFO New York State Archives
XII.4.D Certification of Internal Controls over the Payment Process Evidence and Record Retention Audit Program
XIV.9 Statewide Financial System Imaging and Attachment Guidance
XII.3 Record Retention – Accounts Payable Vouchers and Land Claims
XIII.3 Record Retention – Travel and Expense
New York State Archives
Digital Imaging Guidelines
Managing Records Guidance

15. 2019 Requirement Procurement Card Purchases
Contracts Requiring Electronic Payments

16. Questions ?

17. Contact Us