Internal Audit Report 

Comprehensive Operational Audit 
Aviation Maintenance Department 

January 1, 2012  September 30, 2013 




Issue Date: December 3, 2013 
Report No. 2012-21

Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 

Table of Contents 

TRANSMITTAL LETTER ......................................................................................................... 3 
EXECUTIVE SUMMARY ......................................................................................................... 4 
BACKGROUND ....................................................................................................................... 5 
HIGHLIGHTS AND ACCOMPLISHMENTS ............................................................................. 5 
AUDIT SCOPE AND METHODOLOGY .................................................................................. 5 
CONCLUSION ......................................................................................................................... 7 









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Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 

Transmittal Letter 


Audit Committee 
Port of Seattle 
Seattle, Washington 

We have completed an audit of the Aviation Maintenance Department. 
We reviewed information relating to the Aviation Maintenance Department from January 1, 2012  
September 30, 2013.
We conducted the audit in accordance with Generally Accepted Government Auditing Standards and
the International Standards for the Professional Practice of Internal Auditing. Those standards require
that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives. We believe that the evidence
obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. 
We extend our appreciation to the management and staff of the Aviation Maintenance Department for
their assistance and cooperation during the audit. 



Joyce Kirangi, CPA, CGMA 
Director, Internal Audit 

Audit Team:                         Responsible Management Team: 
Brian Nancekivell, Senior Internal Auditor       John Christianson, General Manager, Retired 
Jack Hutchinson, Internal Audit Manager       Stuart Mathews, General Manager 


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Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 
Executive Summary 

Audit Scope and Objective The purpose of the audit was to determine whether the Department's 
controls are adequate to ensure: 
1.  Inventory records are accurate and complete. 
2.  Asset information is recorded completely, accurately, and timely in the Maximo system. 
3.  The preventive maintenance program is timely and effective. 
We reviewed information for the period January 1, 2012  September 30, 2013. 
Background Aviation Maintenance is the Port's largest department with approximately 360
employees and an annual operating budget of approximately $56 million. There are nine separate
labor unions representing approximately 300 Aviation Maintenance employees. Department 
operations are located throughout the airport and surrounding area. The Department's primary
objective is to ensure properly functioning systems and equipment at aviation facilities. The
Department does not have regular revenue streams; however, it generates nominal reimbursements
for work related to warranties or damage caused to Port property by third parties, which offset
expenses. 
In support of maintenance efforts, the Department maintains an inventory of materials valued at over
$6 million at its distribution center and at shop locations throughout the airport. The Department uses
Maximo, a computerized maintenance management system, to process maintenance work orders, 
manage purchasing and inventory, and report on key management metrics. Maximo supports most 
aspects of the Department's operations. 
Audit Result Summary  Aviation Maintenance's controls are adequate to ensure that inventory
records are accurate and complete, asset information is recorded completely, accurately and timely,
and the preventive maintenance program is timely and effective.







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Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 
Background 
Aviation Maintenance is the Port's largest department with approximately            360 employees and an
annual operating budget of approximately $56  million. There      are nine separate labor unions
representing approximately 300 Aviation Maintenance employees. Department operations are located 
throughout the airport and surrounding area. The Department's primary objective is to ensure properly 
functioning systems and equipment at aviation facilities.                     The Department does not have regular
revenue streams; however, it generates nominal                reimbursements for work related to warranties or
damage caused to Port property by third parties, which offset expenses. Salaries and benefits are the 
Department's largest expense. 
Operating Expenses (in thousands)          2011          2012 
Salaries, Wages, & Benefits               36,299         41,361 
Equipment & Supplies                  5,644         6,770 
Other Expenses                      6,414         5,700
Total                               48,357         53,831 
Data Source: PeopleSoft, as of November 7, 2013 
In support of maintenance efforts, the Department maintains an inventory of materials valued at over
$6 million at its distribution center and at shop locations throughout the airport. The Department uses
Maximo, a computerized maintenance management system, to process maintenance work orders, 
manage purchasing and inventory, and report on key management metrics. Maximo supports most 
aspects of the Department's operations. 
Highlights and Accomplishments 
During the course of the audit, we noted some significant Department highlights and
accomplishments. The Department: 
Implemented a robust system of metrics to monitor, assess, and modify businesses practices. 
Developed and is implementing a plan to use mobile devices in the field to improve the
efficiency of maintenance operations. 
Implemented LEAN strategies in certain areas to assess and improve work plans and internal
procedures, and is extending lessons learned to other areas of Department operations. 
Audit Scope and Methodology 
We reviewed information for the period January 1, 2012  September 30, 2013. We utilized a riskbased
audit approach from planning to testing. We gathered information through research, interviews, 
observations, and analytical reviews, in order to obtain a complete understanding of the operations of
the Aviation Maintenance Department. Risks associated with small tools and equipment were not
addressed in this engagement because the Internal Audit Department is addressing this area in a
separate port-wide audit, the results of which will be published in early 2014. 
We applied additional detailed audit procedures to areas with the highest likelihood of significant
negative impact as follows: 
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Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 
To determine whether the Department's controls are adequate to ensure that              inventory records are
accurate and complete, we performed the following procedures: 
1.  Inventory Testing 
We conducted a physical inventory   of a sample of 42 items, with a higher likelihood of
inaccurate records, on hand at         16 Aviation Maintenance inventory locations to verify that the
inventory information (e.g., counts and locations) reflected in Maximo were accurate. 
2.  Inventory Associated With Maintenance Assets 
We identified the 832 items added to Maximo during the period February 28, 2013  
September 30, 2013, and determined whether new items were associated with the assets for
which they are required. 
3.  Zero Value Inventory 
We traced a sample of 23 items contained in the zero value warehouse to inventory usage
records to determine whether zero value items were being used before regular inventory. Zero
value inventory consists of items that were returned unused after work orders were closed and
items of unknown origin that came into the Department's possession. 
To determine whether the Department's controls are adequate to ensure that asset information is
recorded completely, accurately, and timely into Maximo, we performed the following procedures: 
4.  Asset Information Recorded in Maximo 
We determined whether key asset information was obtained and recorded by the Department
for a sample of 12 Port assets that went into service and a sample of 8 Port projects that were
completed during the period January 1, 2012  September 30, 2013. 
5.  Aviation Asset Management Team 
We reviewed documentation of the Department's efforts to date as part of the Aviation Asset
Management Core Team, which is developing processes in support of the Sustainable Asset
Management policy, to determine whether the team is taking a systematic approach to
assessing and improving the asset management process. 
To determine whether the Department's controls are adequate to ensure that the preventive
maintenance program is timely and effective, we performed the following procedures: 
6.  Preventive Maintenance Timeliness 
We analyzed the Department's progress toward its on-time preventive maintenance and
proactive maintenance goals for the period January 1, 2012  September 30, 2013, and
assessed the Department's progress over time. 

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Internal Audit Report 
Aviation Maintenance 
January 1, 2012  September 30, 2013 
7.  Preventive Maintenance Assessment and Optimization 
We reviewed theDepartment's efforts toward its goal to optimize its preventive maintenance 
work for a sample of six maintenance shops as of the end of September 2013, to determine 
whether the Department followed reasonable procedures to assess and optimize its work plan. 

Conclusion 
Aviation Maintenance's controls are adequate to ensure that inventory records are accurate and
complete, asset information is recorded completely, accurately and timely, and the preventive
maintenance program is timely and effective. 














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