COMPREHENSIVE OPERATIONAL AUDIT 
INTERNAL AUDIT 
COMMISSION OFFICE 
BACKGROUND 
The Commission Office is a department within the Port of Seattle. This audit was focused on the departmental activities, 
not on the Commissioners themselves. The current structure of the Commission Office includes a Chief of Staff, who 
reports directly to the Commissioners, and six full-time staff members, who report to the Chief of Staff. The Commission 
Office provides broad support to the five elected Commissioners, including, but not limited to: 
Policy research and analysis. 
Scheduling Commissioners' meetings and activities within the Port and the community. 
Scheduling travel and processing expenses. 
Noticing public meetings of the Commission, preparing agendas and briefing materials, and posting video-taped 
meetings and approved minutes to the internet. 
Publishing Commissioner expenses on the Port's internet. 
Processing Commissioners' per diems and salaries. 
Liaising with other Port departments. 
Training new Commissioners.

COMPREHENSIVE OPERATIONAL AUDIT 
INTERNAL AUDIT 
COMMISSION OFFICE 
AUDIT OBJECTIVES AND SCOPE 

The purpose of the audit was to determine whether management controls over the following areas are adequate to ensure: 
Commissioners and staff are provided adequate training/information flow. 
Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. 
Transparency. 
Commissioners' expenses are valid and related to Port business and comply with Port guidelines. 
We reviewed information for the period January 1, 2014  September 30, 2015. 

FINANCIAL HIGHLIGHTS

COMPREHENSIVE OPERATIONAL AUDIT 
INTERNAL AUDIT 
COMMISSION OFFICE 

Management controls over the following are materially adequate: 
Commissioners and staff are provided materially adequate training/information flow. 
Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. 
Transparency. 
Commissioners' expenses are valid and related to Port business and comply with Port guidelines. 
No Reportable Findings.

LIMITED OPERATIONAL AUDIT OF THE INVENTORY
INTERNAL AUDIT 
PROGRAM AT AVIATION AND MARINE MAINTENANCE 
BACKGROUND 
Marine Maintenance (MM) and Aviation Maintenance (AVM) provide facilities and equipment maintenance. 
MM supports the Real Estate Department and Maritime Line of Business within the Port of Seattle with 14 specialized craft 
functions to respond to customer requests. MM maintains an inventory valued at approximately $290,000. 
AVM is responsible for all airport facilities. As the largest Port of Seattle Line of Business, AVM supports 14 functional 
maintenance shops with over 300 craft personnel. The inventory is valued at approximately $6.5 million. 
Both MM and AVM use Maximo, an IBM software solution to record inventory purchases, usage, and disposition. 

AUDIT OBJECTIVES AND SCOPE

LIMITED OPERATIONAL AUDIT OF THE INVENTORY
PROGRAM AT AVIATION AND MARINE MAINTENANCE          INTERNAL AUDIT 
FINANCIAL HIGHLIGHTS 
The days in inventory ratio is an efficiency ratio that measures the average number of days the organization holds its 
inventory before using it. The ratio reflects the number of days funds are tied up in inventory and measures how long it 
takes a company to use inventory. Generally, a low ratio is preferred. 
INVENTORY TURNOVER RATIO AND DAYS IN INVENTORY RATIO
AVIATION     AVIATION   MARINE      MARINE
YEAR ENDED   INVENTORY DAYS INVENTORY INVENTORY DAYS INVENTORY
2012          $ 6,503,823                  770    $ 327,992                347
2013             6,341,000                  782        345,476                368 
2014             6,487,198                  747        358,218                433 
2015 (as of October 31    6,513,752                     770          364,125                   418 
Data Source: PeopleSoft Financials

AUDIT RESULT 
Processes are not always efficient or effective at identifying and removing inventory that has not been used in over 12 
months as required by Accounting Policy 13 - Disposition of Property. Disposition of inventory within this time frame 
facilitates cost savings while maximizing return on investment. 
Additionally, purchasing practices could be enhanced so that inventory that has already been purchased and available for 
use is used before additional purchases of inventory are made for the same item. 
One Reportable Finding

LIMITED OPERATIONAL AUDIT OF THE INVENTORY
PROGRAM AT AVIATION AND MARINE MAINTENANCE 
INTERNAL AUDIT 
AUDIT RESULT  REPORTABLE FINDING 
1. INTERNAL CONTROLS TO IDENTIFY AND REMOVE INVENTORY THAT IS OBSOLETE, EXCESSIVE, 
OR HAS NO MARKET VALUE ARE NOT ALWAYS EFFICIENT OR EFFECTIVE. 
Policy AC-13 Disposition of Property states (in part): 
.02(b) Inventory is expected to be consumed within a year 
.03 Property should be disposed when it no longer services its intended purpose, no alternative 
future use within 12 months exists, it is not considered a specialty item, and/or the Port no longer 
requires it to maximize the return on investment for the disposal of Port's property 
A review of AVM and MM inventory identified a significant amount of inventory aged over 12 months (see 
table below): 
AVIATION              MARINE
INVENTORY ITEM LAST ISSUED                      AMOUNT   PERCENTAGE     AMOUNT  PERCENTAGE
Within 1 year                           $ 1,841,488                   28% $ 171,958                  59%
Within 2 years                          332,982                   5           24,828                  9 
Within 3 years                          348,445                   5           18,646                  6 
Within 4 years                          204,090                   3            8,903                  3 
Over 4 years                          3,851,203                    59            66,636                  23 
TOTAL               $ 6,578,208            100% $ 290,970           100%
Data Source: Maximo

REPORTABLE FINDING CONTINUED                                        INTERNAL AUDIT 

Zero value inventory consists of items remaining after completion of capital projects and is not required to be 
reclassified to inventory from construction work-in-process. These items, however, are still required to be 
tracked for property stewardship and are expected to be consumed within 12 months. Similarly, 94% of zero 
value inventory (AVM only) has not been issued in over four years. 
AVIATION MAINTENAINCE ZERO VALUE INVENTORY USAGE 
INVENTORY ITEM LAST ISSUED                      SKU        PERCENTAGE 
Within 1 year                                                   101                    2% 
Within 2 years                                                   84                     1 
Within 3 years                                                   85                     2 
Within 4 years                                                   68                     1 
Over 4 years                                                  4,898                    94 
TOTAL                                      5,236             100% 
Data Source: Maximo 
Purchasing processes and controls are not always effective: 
AVM: Zero value inventory is expected to be used prior to purchasing additional inventory of the same 
item. However, 50% or 20 of the 40 items tested had the same inventory in both zero value and current 
inventory indicating that purchases are sometimes made without consideration for what is already 
available in zero value inventory. 
MM: Using a risk based sampling approach, we tested purchases from January 1, 2015 through October 
31, 2015. Of the 18 purchases tested, 15 purchases were made for items that were already in inventory.