Audit of the Office of the State Treasurer and Receiver General

This is a performance audit of the Massachusetts Office of the State Treasurer and Receiver General covering January 1, 2019 through December 31, 2020.

“This report details the audit objectives, scope, methodology, findings, and recommendations for the audit period, January 1, 2019 through December 31, 2020.”

Auditors checked whether the Treasurer’s office properly handled approved bank lists, agency bank accounts, required reports, and sheriff civil process fee payments.

“The purpose of our audit was to determine whether OST maintained and updated a list of qualified banks; published and transmitted the list to the Office of the Governor at least every six months as required by Section 34(a) of Chapter 29 of the General Laws; and ensured that state agencies used qualified banks when maintaining bank accounts established under Section 34(a) of Chapter 29 of the General Laws.”

If required money is not sent in and tracked, it may not reach the state’s General Fund for public programs and services.

“If civil process fees due the Commonwealth’s General Fund are not consistently transmitted by all sheriffs’ departments to OST for deposit, the fees are not available to be spent on approved state programs or services in accordance with the budget approved by the Legislature.”

This matters to residents because the Treasurer’s office handles public money, including deposits, investments, and state funds.

“The Office of the State Treasurer and Receiver General (OST) is responsible for a variety of important financial functions, as established by Chapter 10 of the Massachusetts General Laws, including receiving, managing, and investing all funds paid to the Commonwealth.”

The Treasurer’s office agreed with two findings, disagreed with the sheriff-fee monitoring finding, and the Auditor stood by that recommendation.

“Therefore, we stand by our recommendation that OST develop and implement policies and procedures to monitor the transmittal of civil process fees by sheriffs’ departments to OST for deposit.”

The Auditor recommended new or improved procedures: monitor sheriff fee transfers, publish the qualified-bank list on schedule, and add controls to catch errors in the bank-account list.

“OST should develop and implement policies and procedures to monitor the transmittal of civil process fees by sheriffs’ departments to OST for deposit.”

The biggest practical risk is that weak tracking could leave public funds in the wrong place, delayed, or held by a bank that should not be used by the state.

“However, if a bank doing business with the Commonwealth loses its qualified status and an accurate list of Commonwealth bank accounts is not available, there is a risk that a state agency could unwittingly do business with an unqualified bank, putting Commonwealth funds at risk of loss.”

A “qualified bank” means a bank approved for state use; the audit says the Treasurer must keep and send out that list regularly.

“To ensure that only qualified banks are used by state officers, departments, institutions, and other agencies, OST’s Cash Management Department generates and maintains a list of qualified banks that are approved for use.”