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An Audit Report on The Real Estate Commission: A Self-directed, Semi-independent Agency

July 2019

Summary Analysis

The Real Estate Commission (Commission) has established processes and controls to ensure the accuracy and completeness of financial data that it is required to report. However, the Commission should strengthen controls over its financial data to ensure that it reports revenue information accurately.

The Commission has also established a process for budgeting, setting fees, and assessing administrative penalties. However, it should continue to strengthen its budgeting process to take appropriate action to reduce fees when approved fund balance reserves are exceeded.

 Jump to Overall Conclusion

While the Commission had processes in place to report financial data in its Annual Financial report (AFR), it should strengthen those processes and controls to help ensure that it accurately reports revenue collected.

Jump to Chapter 1-A 

The Commission had processes and controls to ensure that it accurately pays operational expenditures in accordance with its requirements and also appropriately pays claims and judgments against the recovery funds it administers, as required by Texas Occupations Code, Chapters 1101 and 1102, and the Commission’s requirements.

Jump to Chapter 1-B 

The Commission had an established process for budgeting and fee setting, including review and approval of annual budgets and fee schedules by Commissioners. However, the Commission did not always ensure that it appropriately adjusted fees when fund balances exceeded approved fund balance levels.

Jump to Chapter 2 

The Commission complied with certain statutory requirements for submitting biennial and annual self-directed, semi-independent (SDSI) reports related to the inclusion of certain elements and timely submission.

Due to the Commission’s SDSI status, as authorized in the Texas Occupations Code, Chapter 1105, it is not required to include performance data as part of its SDSI reports. In addition, at the time of this audit the Commission was revising its performance measures process in response to a recommendation from the Sunset Advisory Commission.

Jump to Chapter 3 

Auditors identified weaknesses in the Commission’s controls over access to its (1) internal network, (2) Versa Regulation system, (3) Versa Online application, and (4) USAS. In addition, the Commission did not have documentation showing appropriate segregation of duties within its change management process for significant changes made to its Versa system and Versa Online application.

Jump to Chapter 4 

Graphics, Media, Supporting documents

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