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#954393 - 05/05/08 04:49 PM SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE
one auditor Offline
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Joined: Apr 2004
Posts: 104
Midwest
We have provided management with an audit report on the safe deposit box function. In particular the details are noted below. They do not agree with the recommendation and provide their reasons as to why. I have seen many banks that document their review of the safe deposit box booth, used by the customer to conduct their business, to ensure nothing was left behind by the customer. What is commonly done with this?

AUDIT ISSUE:
It was observed that Safe Deposit Attendants did not document that they had inspected the booth or area used by the customer, prior to the customer leaving, to ensure nothing was forgotten or left out by the customer.

RECOMMENDATION:
Implement procedures in which the attendant admitting the customer to their safe deposit box initials half of the “Initials” box on the entrance card, and the attendant helping the customer place their box back in the vault would initial the second half of the “Initials” box to document that they had inspected the booth or area used by the customer and verified that nothing was forgotten by the customer. If the same attendant performs both functions, they would be required to initial both halves to properly document the completion of the procedures.

MANAGEMENT RESPONSE:
Procedures require the attendant to inspect the booths before and after customer use. This is considered industry best practice and bank practice and procedures reflect this. Research with industry resources have revealed that documenting the inspection in not common and doing so may in fact expose the bank to liability should the customer claim something be missing and it could be proven that the bank failed to follow that procedure. The bank will not implement the recommendation.

Thank you for your help.

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#954506 - 05/05/08 06:37 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE one auditor
#12 Offline
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Posts: 1,338
We do not document the booth review. It is in our procedures.
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#954554 - 05/05/08 07:48 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE #12
RR Sarah Offline
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RR Sarah
Joined: Mar 2004
Posts: 2,494
Up North
Same as #12...
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#954571 - 05/05/08 08:03 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE RR Sarah
#Just Jay Online
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#Just Jay
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Posts: 14,390
Cheeseheadland
Ditto...
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#954776 - 05/06/08 12:44 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE #Just Jay
A_G Offline
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Joined: Jul 2004
Posts: 18,962
Same here.

It does seem like a bit of overkill. As long as it's in the procedures.
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#955681 - 05/07/08 07:02 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE A_G
MN Banker Offline
Platinum Poster
Joined: Aug 2006
Posts: 980
I agree with pp - at some point you have to let the procedures speak for themselves. By requiring that they initial, you are basically opening the door for more audit violations if they forget to do so (just because they didn't initial doesn't mean they didn't check the area, and just because they initialed doesn't mean they did). Granted it's nice for the audit team to have written "proof" that they are following procedures; however there are other (and in my opinion, better) ways to verify people are following procedures than by making them document it every time.

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#955693 - 05/07/08 07:21 PM Re: SAFE DEPOSIT BOX ISSUE MANAGEMENT DOES NOT AGREE MN Banker
Countess Kiwi Offline
Diamond Poster
Joined: Jun 2002
Posts: 1,815
Minnesota
Sometimes you need to just observe. If it is in the procedures, test it through observation some time and then make a comment about it not being done or that it is being done according to procedures.
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