The Office of Shared Services (OSS) has moved swiftly to implement tighter controls after an internal audit found a weakness in a new payments system, Treasurer Eric Ripper said today.
An assessment by the independent Office of the Auditor General (OAG) found a ‘segregation of duties’ control weakness in the Oracle Procedure to Pay system within the OSS.
But the Auditor General also noted the problem had since been resolved. The OAG issued a qualification in its independent audit opinion as part of the Department of Treasury and Finance’s (DTF) 2006-07 annual report.
The qualification relates to internal controls at Shared Services, which has been a business unit of the DTF since the beginning of 2007.
Mr Ripper welcomed the close scrutiny of Shared Services and said it showed the checks within government were working.
The Treasurer said the control issue had vindicated the high-level audit requirements that both he and Shared Services had insisted on.
“Of course I was deeply concerned to hear this problem existed but also heartened that it was discovered and quickly resolved,” he said.
Mr Ripper said Shared Services had appointed Ernst & Young to undertake rigorous quarterly audits of both individual Oracle finance modules and the general control environment they operated in.
“This was a deliberate strategy of stronger than normal audit tests to ensure that, as the implementation of Shared Services systems progressed, the controls in place were appropriate,” he said.
The Treasurer said the control weakness was found in just one of the 49 control objectives examined.
“The issue was specifically a lack of segregation of duties in relation to the Oracle ‘procure to pay’ system,” he said.
Mr Ripper said both the Auditor General and the Office of Shared Services were now satisfied the matter had been resolved.
“The Auditor General notes that the OSS has introduced enhanced procedures and that further testing of the system found no fraudulent payments were made during the time this problem existed,” he said.
“There will always be some teething problems when you take on a project of this size.
“But the OSS will eventually save our public sector about $55million a year once fully implemented.”
The Department of Treasury and Finance’ annual report was tabled in State Parliament today.
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