Guam Department Of Corrections Has Severely Flawed Accounting

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Lost funds and inaccurate costs per prisoner, key issues

By Jasmine Stole

HAGÅTÑA, Guam (Marianas Variety Guam, July 4, 2014) – According to a performance audit published by the Office of Public Accountability yesterday, the Department of Corrections’ weak accounting infrastructure allowed $299,000 of federal funds to slip by unrealized.

Further, the OPA was unable to determine how much the government spends on each DOC prisoner because of the prison’s flawed methodology and inaccurate calculations.

The audit reported that between fiscal years 2011 and 2013, DOC billed the Federal Bureau of Prisons, U.S. Marshals Service and the U.S. Immigration and Customs Enforcement agencies a total of $4.2 million as reimbursement for housing federal prisoners.

The reimbursement goes into the DOC Inmates Revolving Fund and during the auditors review of the deposits, it was discovered that $299,000 was not recorded in the Department of Administration’s AS400 system. The funds had not been reimbursed and DOC did not discover the discrepancies because of the lack of a running log of funds the department receives and claims it makes.

Unable to determine prisoner cost

The latest prisoner cost estimate was made in fiscal 2011 and placed the cost per prisoner per day at $119. However, the report stated that cost is an inaccurate calculation because it includes fixed costs of utilities and administrative expenditures.

Costs also appeared to auditors to be overstated. In addition to the inaccurate calculation, the prison population by which the calculation was made was also flawed. The OPA noted that the average prison population DOC used in fiscal years 2011, 2012 and 2013 could not be verified.

"We found that DOC used the wrong fiscal year prisoner population in their calculation. DOC used FY 2012 average daily population of 600 prisoners rather than the FY 2011 average daily population of 615 prisoners based on the Daily Population Statistics Report provided by DOC," the report stated.

The auditor cross-checked the daily population of the three years DOC provided against three separate reports and discovered "significant variances" among them. The Daily Population Statistics Report was cross-checked against the Management Information System print-out report and the warden’s report.

Since all three reports had variances, DOC was unable to make out an accurate daily population when calculating its cost per prisoner, the OPA wrote in the report.

The average per diem rate for Guam’s off-island prisoners was also unable to be calculated because documents between DOC and the Federal Bureau of Prisons were not provided.

"DOC has an inadequate cost reporting system and weak accounting infrastructure that hinder them in calculating accurate cost per prisoner," the report stated. "As a result, they have insufficient data to allow them to measure their performance and they are unable to substantiate requests to increase the federal per diem rates."

Not updated

Moreover, the per diem rates at which DOC charges federal agencies have not been updated for at least 11 years.

In an effort to determine if the federal government was underpaying the local prison, DOC attempted to calculate the cost per prisoner and the OPA found that the latest per diem rates were provided in October 2002.

OPA recommended the prison assign a non-uniformed staff member to develop incarceration cost information and to maintain its database. Having a management analyst or a related position would do the prison well.

It was also recommended that DOC management routinely review and monitor cost per prisoner data, reimbursements from the federal government, and billings to house off-island prisoners. Management should also collect all overdue payments and accrued interest, if necessary, the report recommended.

Finally, the OPA reported that DOC should coordinate with DOA regarding the uncollected $299,000 discrepancy.

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