2025 VEBF Newsletters

  VILLAGE EMPLOYEES BENEFIT FUND (VEBF) INTERNAL AUDIT

MAY 15, 2024

Updated March 12, 2025

The three-member Audit Committee for 2025 (Bob Zellner, Lloyd Sherman and Diana Podawiltz) have collaborated and are all in concert that the VEBF does not require an in-depth audit every year and recommends to the full board that a schedule of an audit be performed every three (3) years. This year’s audit was comprised of reviewing the recommendations made in 2024 and providing an update.

Introduction:

A request for an internal audit of the Village Employee Benefit Fund (VEBF) was made by the President of the VEBF. A committee consisting of two board members and one volunteer non-member, with extensive accounting experience, was selected.

Scope:

The internal audit process examined and reviewed the development, recording and retention of corporate and financial records, as well as activities associated with soliciting, collecting and distribution of funds.

Audit Findings:

At this point in time, the VEBF is operating at a $100,000 business/donation level. In conducting the internal audit, the committee used this number as the current base operating number when discussing further projections and observations.

To perform the internal audit process, interviews were held with various VEBF executive committee members. At the conclusion of the interviews and review of financial documents, the audit committee believes the VEBF is meeting accepted accounting standards, record keeping and general operating practices. However, to facilitate future growth, as well as protect the current operating practices, the following observations are presented for consideration.

Observations:

Financial:

The financial area has a good, well organized accounting program in place to process any and all current donation activity. The unique aspect of the VEBF is the 60–90-day response requirements following the mass mailing. It is a full-time job during that period revolving around daily trips to the post office, bank deposit and time spent reconciling cash, credit cards and checks. At the current activity level, this is a challenging time and cost to the treasurer. A significant upward change in donation volume will only increase the time and effort needed to efficiently process everything into the VEBF system.

With guidance from the treasurer, additional personnel resources should be applied to this area. Not only would this apply to the current donation season, but also start a training program for someone taking over this position in the future. This is a key area that needs more than one person with management capability.  As the volume continues to grow, consideration should be given to automating these functions into an accounting software platform.

Additionally, the process following the annual luncheon of turning funds over to the POA should be reviewed to provide for a documented “chain-of-custody” process.

2025 Update:

1. Additional personnel were selected to assist with the end-of-year activities.

2. All processes were fully documented and additional personnel were indoctrinated in the process.

3. A chain-of-custody process was put in place and exercised for the 2024 calendar year and should be continued going forward.

Record Keeping/Documentation

The interviews revealed that financial records, VEBF documents and other records are being kept by executive committee members on their home computers. Since there is no Principal Office for VEBF, this action is understandable. The risk of this situation is that no other person has the ability to retrieve key information if a major event occurs and the secretary or treasurer becomes totally unavailable. Steps should be taken to establish some type of backup system where more than one person has immediate access to any and all VEBF information via a document backup process.

While at the current level of activity, individual responsibilities are being handled well. However, for future growth and ease of transitioning positions to new board members, a list of duties or job descriptions should be a consideration.

2025 Update:

1. A backup system for records was put in place and records are being maintained in a locked file cabinet that can only be accessed by VEBF.

2. A retention schedule was established, reviewed with the board, and implemented.

Specific Action Items For Consideration

1. Review automated check processing option provided by the banking institution.

1. 2025 Update– This was researched and it was determined that this option would not be cost effective.

2. A plan should be established by the Board and Treasurer that outlines options for processing the fourth quarter workload, utilizing a designated and trained VEBF board member. This plan would be implemented when the President and Treasurer identify the need.

1. 2025 Result – This recommended process was implemented and should be continued.

3. It is recommended that each current executive office prepare a detailed written job description.

1. 2025 Result – It was determined that the Bylaws contain adequate job descriptions. 

4. It is recommended that all minutes and other operational records be backed to a thumb drive from each individual computer. Updates should be made monthly and stored in a bank deposit box. The key should be held by the president.

1. 2025 Results – This recommended process was implemented and should be continued.

5. Financial information is backed to the cloud. Access and the password should be made available to an assistant treasurer or designated board member.

1. 2025 Results – This recommended process was implemented and should be continued.

Audit Conclusion

It is the opinion of the Audit Committee that all participants in this audit provided information about their respective area of responsibility in a very cooperative and clear manner. The information provided was extremely helpful in identifying operating issues that should be reviewed and possibly adjusted to meet the growing requirements of the VEBF.