Report 3 Commission Office
INTERNAL AUDIT REPORT COMMISSION OFFICE Comprehensive Operational Audit JANUARY 1, 2014 SEPTEMBER 30, 2015 ISSUE DATE: FEBRUARY 22, 2016 REPORT NO. 2016-03 COMMISSION OFFICE INTERNAL AUDIT JANUARY 1, 2014 SEPTEMBER 30, 2015 EXECUTIVE SUMMARY AUDIT OBJECTIVES AND SCOPE The purpose of the audit was to determine whether management controls over the following areas are adequate to ensure: 1. Commissioners and staff are provided adequate training/information flow. 2. Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. 3. Transparency. 4. 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. Details of our audit's scope and methodology are on page 2. 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 fulltime 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: 1. Policy research and analysis. 2. Scheduling Commissioners' meetings and activities within the Port and the community. 3. Scheduling travel and processing expenses. 4. Noticing public meetings of the Commission, preparing agendas and briefing materials, and posting video-taped meetings and approved minutes to the internet. 5. Publishing Commissioner expenses on the Port's internet. 6. Processing Commissioners' per diems and salaries. 7. Liaising with other Port departments. 8. Training new Commissioners. O AUDIT RESULT Management controls over the following are materially adequate: 1. Commissioners and staff are provided materially adequate training/information flow. 2. Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. 3. Transparency. 4. Commissioners' expenses are valid and related to Port business and comply with Port guidelines. i COMMISSION OFFICE INTERNAL AUDIT JANUARY 1, 2014 SEPTEMBER 30, 2015 TABLE OF CONTENTS EXECUTIVE SUMMARY ................................................................................................................................................. i TRANSMITTAL LETTER ................................................................................................................................................ 1 BACKGROUND ............................................................................................................................................................. 2 FINANCIAL HIGHLIGHTS ............................................................................................................................................. 2 HIGHLIGHTS AND ACCOMPLISHMENTS.................................................................................................................... 2 AUDIT SCOPE AND METHODOLOGY .......................................................................................................................... 3 CONCLUSION ............................................................................................................................................................... 3 COMMISSION OFFICE INTERNAL AUDIT JANUARY 1, 2014 SEPTEMBER 30, 2015 TRANSMITTAL LETTER Audit Committee Port of Seattle Seattle, Washington We have completed an audit of the management controls over Commission Office activity. We reviewed information relating to the Commission Office from January 1, 2014 September 30, 2015. We conducted this performance 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 management and staff of the Commission Office and to the Commissioners for their assistance and cooperation during the audit. Joyce Kirangi, CPA, CGMA Internal Audit, Director AUDIT TEAM RESPONSIBLE MANAGEMENT TEAM Ruth Riddle, Senior Auditor Mike Merritt, Chief of Staff Commissioners Bowman and Gregoire, Co-Presidents 1 COMMISSION OFFICE INTERNAL AUDIT JANUARY 1, 2014 SEPTEMBER 30, 2015 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 fulltime staff members, who report to the Chief of Staff. The six full-time staff positions include the following: Policy Analyst (2) Executive Assistant (2) Commission Clerk Assistant Commission Clerk The Commission Office provides broad support to the Commissioners, including, but not limited to: 1. Policy research and analysis. 2. Scheduling Commissioners' meetings and activities within the Port and the community. 3. Scheduling travel and processing expenses. 4. Noticing public meetings of the Commission, preparing agendas and briefing materials, and posting video-taped meetings and approved minutes to the internet. 5. Publishing Commissioner expenses on the Port's internet. 6. Processing Commissioners' per diems and salaries. 7. Liaising with other Port departments. 8. Training new Commissioners. FINANCIAL HIGHLIGHTS COMMISSION OFFICE EXPENSES YEAR AMOUNT 2014 $1,343,968 2015 (thru 9-30-15) $960,962 Data Source: PeopleSoft Financials HIGHLIGHTS AND ACCOMPLISHMENTS Management updated the Commissioners' Handbook in preparation for providing training to the new Commissioner in 2016. Processes have been improved to ensure: o Timely and accurate posting of Commissioners' expenses and per diems to the internet. o Constituent correspondence is tracked and responses provided timely. 2 COMMISSION OFFICE INTERNAL AUDIT JANUARY 1, 2014 SEPTEMBER 30, 2015 AUDIT SCOPE AND METHODOLOGY We reviewed information for the period January 1, 2014 September 30, 2015. We utilized a riskbased approach from planning to testing. We gathered information through research, interviews, observations, and analytical review, in order to obtain a complete understanding of management controls over Commission Office activity. We evaluated risk and tested the mitigating controls, to determine whether they were operating as intended. The key management controls we tested and the detailed tests we performed are as follows: 1. Commissioners and staff are provided adequate training/information flow: a. Review new Commissioner orientation manual to determine whether it provides adequate information. b. Discuss training/communication of information with staff to determine whether adequate. 2. Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. a. Test 100% of per diem and salaries for all Commissioners. b. Trace at least one month's per diem for each Commissioner to supporting calendared schedule of events/activities. 3. Transparency a. Trace a limited number of Commissioners' expenses posted to internet to actual disbursements. b. Trace 100% of per diems posted to internet to amounts disbursed. c. Determine whether Commission meetings are open and public and commission actions are available to the public. 4. Commissioners' expenses are valid and related to Port business and comply with Port guidelines a. Select a limited number of expenses for each Commissioner and conduct triple-purpose testing to determine whether: i. Properly approved (control). ii. Properly supported by receipts (substantive) in Concur. iii. Valid Port business (compliance). CONCLUSION Management controls over the following are materially adequate: 1. Commissioners and staff are provided materially adequate training and information flow. 2. Commissioners' per diem and salaries are in compliance with legal requirements and properly supported. 3. Transparency. 4. Commissioners' expenses are valid and related to Port business and comply with Port guidelines. 3
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