Internal Audit Internal Audit Briefing 
Presented to the Port of Seattle 
Audit Committee and Tay Yoshitani, CEO 

Joyce Kirangi, CPA, CGMA 
Director, Internal Audit 
February 04, 2014

Agenda 
Audit Report 
1.  Lease and Concession Audits 
None 
2.  Operational Audits 
Central Processing System 
None 
Comprehensive Operational Audit /Departmental Audit 
Accountability for Tools and Equipment under $20,000 
Port Construction Services (PCS) Close-Out Process 
Limited Operational Audit 
None 
3rd Party Audit 
None 
Briefing/Updates 
Finalize Internal Audit 2014 Work Plan 
Required Annual Communication to the Audit Committee

Limited Operational Audit 
Accountability for Tools and Equipment under $20,000 
Background 
The Port's threshold to distinguish capital assets from personal property
(expensed items) is $20,000. 
Accountability for the Port's personal property, which is the focus of this
audit, is at management discretion.
During 2011 and 2012, the Port expended $2.8 and $3.3 million,
respectively, on tools and equipment. Many of these items are
considered "small and attractive" and at risk of loss and misuse. 
Account Code          Description            2011       2012 
61600     Furniture/Equipment               $ 847,104   $ 1,161,533 
61650     Radios                         166,890    310,980
61700     Shop Tools/Miscellaneous Equipment        230,242    305,090 
61760     Computers/Telephones              1,525,306   1,522,911
TOTAL       $2,769,542   $ 3,300,514 
Data Source: PeopleSoft

Limited Operational Audit 
Accountability for Tools and Equipment under $20,000 
Audit Objectives 
The purpose of the audit was to determine whether Port management
controls are adequate to ensure tools and equipment purchases under
$20,000 are: 
1.  Accounted for and safeguarded. 
2.  In compliance with requirements governing surplus and disposal. 
We reviewed information for the period January 1, 2012 - April 30, 2013.

Limited Operational Audit 
Accountability for Tools and Equipment under $20,000 
Audit Result  One Reportable Condition /Finding 
One Finding 
Port management controls are not adequate to ensure equipment purchases
under $20,000 are accounted for and safeguarded and in compliance with
requirements governing surplus and disposal.

Limited Operational Audit 
Port Construction Services (PCS) Close-Out Process 
Background 
Port Construction Services (PCS) is a department in the Port's Capital 
Development division whose primary mission is to collaborate with other 
Port departments on the completion of smaller-scale projects/activities. 
projects/activities 
The Close-Out Process (COP) is a management control to ensure that all 
financial  and  regulatory  requirements  are  satisfied.  This  includes 
finalizing records for submission, reconciling financial documents, and 
supplying  critical  maintenance  and  management  information  to  Port 
customers. 
Annual Close-Out's by Port Construction Services 
By Fiscal Year, 2011-2013 
2011        2012        2013       TOTAL 
Close-Outs            65        142         80        287
Data Source: Project Management Information Systems Reports

Limited Operational Audit 
Port Construction Services (PCS) Close-Out Process 
Audit Objectives 
The purpose of the audit was to determine whether Port Construction
Services' management has adequate controls to ensure: 
1.  The Close-Out Process complies with applicable Port policies and
procedures. 
2.  The Close-Out Process sufficiently identifies, retains, or transmits all
required records after project completion. 
We reviewed information for the period January 1, 2013  December 31,
2013

Limited Operational Audit 
Port Construction Services (PCS) Close-Out Process 
Audit Result 
Management has adequate controls to ensure that the Close-Out Process 
complies  with  Port  policies  and  procedures,  as  well  as  sufficiently 
identify, retain, and transmit required records after project completion. 
No Reportable Findings/Conditions

Briefing/Updates 

Finalize Internal Audit 2014 Work Plan 
Required Annual Communication to the Audit Committee