[Michlib-l] Question about handling money

[Membiela, Clare (MDE)]

Hi Anita:

A single Circulation staff taking fines AND applying waivers  is a common practice in many libraries of all types – including academic & public.

I have not yet seen an audit for a library that has flagged this as an issue.

The problem, of course, is internal controls, or the assurance that staff will not abuse or misapply the waiver process, and, transparency, or the ability to know the waivers granted, to whom they were granted, and by whom they were granted.

There is no requirement that I can find that dictates libraries must have separate staff undertake these activities, and Internal controls/fraud management practices recommended by CPA/Auditing firms would suggest that a policy to prevent fraud/dishonesty should be crafted with  considerations towards the size of the library, the resources and staff size of the library, and the risk involved.

From what I can find, it seems that the important thing for this issue is that the library have clear and objective policies and practices for waivers, Including, perhaps a policy that a staff member cannot waive fines of family members and cannot waive fines for themselves.

Additionally a policy should include suggested criteria/limitations for waivers (whether authorization is limited by amount of fine, repeated requests for waivers, etc.), and staff should be trained in their authorization to grant waivers.  If applicable, the policy should also contain circumstances under which a supervisor’s approval may be necessary to approve waiver ( perhaps for higher $$ amounts, or repeat waivers -much like in some stores, approval is required from a higher level to complete a return of an item, or a price change).  A control could also be as simple as requiring two on duty staff to initial/approve waivers.

In addition, if your ILS does not have the ability to track waivers, then, for example, a log should be kept with patron, waiver amount, reason and staff initials.
This provides a reporting mechanism and transparency.

Like any policy, the waiver policy would have to be applied neutrally and evenly.


Take a look at Chapter 10 (pp54-60) of the newly updated Public Library Financial Management Guide, which was coordinated by the Library of Michigan, and written by the Accounting/Auditing firm of Yao & Yao
https://www.michigan.gov/documents/libraryofmichigan/LM_SLS_2019_Financial_Management_Guide_FINAL_11-6-19_670795_7.pdf

As always, any policies – including fiscal policies- should be reviewed by your attorney, and perhaps your accountant/auditor.

II hope this is helpful!

Sincerely,
Clare

Clare D. Membiela, MLS, J.D.
Library Law Consultant
Library of Michigan
MembielaC at michigan.gov<mailto:MembielaC at michigan.gov>
517-335-8132

The research and resources above are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem.



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From: michlib-l-bounces at mcls.org <michlib-l-bounces at mcls.org> On Behalf Of Anita Chouinard via Michlib-l
Sent: Thursday, December 19, 2019 10:07 AM
To: Michlib-l at mcls.org
Subject: [Michlib-l] Question about handling money

Hi All,

Recently it has come up that the same staff receiving payments for fines and fees shouldn't be the same staff who can also forgive those same fines and fees. In our library it is all centralized at our Circ desk, and our Circ staff deals with all monetary transactions. It has never been an issue before, but now our Business Manager thinks it could become one for our auditors. I feel it would be a major inconvenience to our patrons if we have to find another staff person to witness the transaction everytime we forgive a fine. Looking for feedback to see what other libraries do.

Thank you,

Anita Chouinard
Circulation Coordinator
Traverse Area District Library
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