3a. Report SAO Audit

Exit Conference: Port of Seattle 
The Office of the Washington State Auditor's vision is increased trust in government. Our mission is to provide
citizens with independent and transparent examinations of how state and local governments use public funds, and
develop strategies that make government more efficient and effective.
The purpose of this meeting is to share the results of your audit and our draft reporting. We value and appreciate
your participation. 
Audit Reports
We will publish the following reports:
Accountability audit for January 1, 2020 through December 31, 2020- see draft report.
Audit Highlights
We appreciate the Port's commitment to the safeguarding of public funds and developing control
systems that ensure compliance with laws and regulations.
The Port responded promptly to our requests and provided all documents necessary to complete the
audit in a timely manner.
We would like to thank Don Kelley, Rudy Caluza, and Glenn Fernandes for participating in weekly status 
update meetings. It allowed for increased communication and kept the audit running smoothly. 
Recommendations not included in the Audit Reports
Exit Items
We have provided exit recommendations for management's consideration. Exit items address control deficiencies
or non-compliance with laws or regulation that have an insignificant or immaterial effect on the entity, or errors
with an immaterial effect on the financial statements. Exit items are not referenced in the audit report.

Work of Other Auditors 
A financial statement audit was performed by Moss Adams LLP of Port. Professional audit standards require us
to evaluate relevant work done by other auditors and communicate certain matters to the governing body.
We performed procedures to ensure we could rely on the work of the external auditors and reference their
audit in our audit report. These procedures included consideration of attendance at key meetings,
evaluation of the firm's last peer review report, review of the other auditor's work, review of the other
auditor's results and communications with the other auditor.
We did not become aware of any instance in which the work of the other auditors gave rise to concern
about the quality of their work.

There were no limitations that restricted our analysis of the other audit(s).
We did not become aware of any instance in which a material misstatement of the financial statements
has or may have resulted from fraud or suspected fraud. 

Finalizing Your Audit
Report Publication
Audit reports are published on our website and distributed via e-mail in an electronic .pdf file. We also offer a
subscription service that allows you to be notified by email when audit reports are released or posted to our
website. You can sign up for this convenient service at: https://portal.sao.wa.gov/SAOPortal .
Audit Cost
At the entrance conference, we estimated the cost of the audit to be $113,000 and actual audit costs will
approximate that amount. 
Your Next Scheduled Audit
Your next audit is scheduled to be conducted in Fall of 2022 and will cover the following general areas:
Accountability for Public Resources
Review of CPA work papers
Assessment audit of the Port of Seattle Industrial Development Corporation

The estimated cost for the next audit based on current rates is $117,160 plus travel expenses. This preliminary
estimate is provided as a budgeting tool and not a guarantee of final cost.
Working Together to Improve Government 
Audit Survey
When your report is released you will receive an audit survey from us. We value your opinions on our audit
services and hope you provide feedback.
Local Government Support Team
This team provides support services to local governments through technical assistance, comparative statistics,
training, and tools to help prevent and detect a loss of public funds. Our website and client portal offers many
resources, including a client Help Desk that answers auditing and accounting questions. Additionally this team
assists with the online filing of your financial statements.
The Center for Government Innovation
The Center for Government Innovation of the Office of the Washington State Auditor is designed to offer services
specifically to help you help the residents you serve at no additional cost to your government. What does this
mean? We provide expert advice in areas like Lean, peer-to-peer networking and culture-building to help local
governments find ways to be more efficient, effective and transparent.  The Center can help you by providing

assistance in financial management, cybersecurity and more. Check out our best practices and other resources
that help local governments act on accounting standard changes, comply with regulations, and respond to
recommendations in your audit. The Center understands that time is your most precious commodity as a public
servant, and we are here to help you do more with the limited hours you have. If you are interested in learning
how we can help you maximize your effect in government, call us at (564) 999-0818 or email us at
Center@sao.wa.gov .
Please contact us with any questions about information in this document or related audit reports.
Kelly Collins, CPA, Director of Local Audit, (564) 999-0807, Kelly.Collins@sao.wa.gov 
Mark Rapozo, CPA, Assistant Director of Local Audit, (564) 999-0794 Mark.Rapozo@sao.wa.gov 
Joe Simmons, CPA, Program Manager, (206) 613-7628, Joseph.Simmons@sao.wa.gov 
Madeleine "Maddie" Frost-Shaffer, Assistant Audit Manager, (206) 613-7627, Madeleine.Frost-
Angela Funamori, Audit Lead, (206) 613-7633, Angela.Funamori@sao.wa.gov

Accountability Audit Report
Port of Seattle 

For the period January 1, 2020 through December 31, 2020 

Published (Inserted by OS)                        Find out what's new at SAO
by scanning this code with
Report No. 1029908                           your smartphone's camera

Office of the Washington State Auditor
Pat McCarthy
Issue Date  (Inserted by OS)

Board of Commissioners
Port of Seattle
Seattle, Washington
Report on Accountability
Thank you for the opportunity to work with you to promote accountability, integrity and openness
in government. The Office of the Washington State Auditor takes seriously our role of providing
state and local governments with assurance and accountability as the independent auditor of public
accounts. In this way, we strive to help government work better, cost less, deliver higher value and
earn greater public trust.
Independent audits provide essential accountability and transparency for Port operations. This
information is valuable to management, the governing body and public stakeholders when
assessing the government's stewardship of public resources.
Attached is our independent audit report on the Port's compliance with applicable requirements
and safeguarding of public resources for the areas we examined. We appreciate the opportunity to
work with your staff and value your cooperation during the audit.

Pat McCarthy, State Auditor
Olympia, WA

Americans with Disabilities
In accordance with the Americans with Disabilities Act, we will make this document available in
alternative formats. For more information, please contact our Office at (564) 999-0950, TDD
Relay at (800) 833-6388, or email our webmaster at webmaster@sao.wa.gov .

Insurance Building, P.O. Box 40021  Olympia, Washington 98504-0021  (564) 999-0950  Pat.McCarthy@sao.wa.gov

Audit Results ................................................................................................................................... 4 
Related Reports ............................................................................................................................... 5 
Information about the Port .............................................................................................................. 6 
About the State Auditor's Office ..................................................................................................... 8 

Office of the Washington State Auditor                   sao.wa.gov                                               Page 3

Results in brief
This report describes the overall results and conclusions for the areas we examined. In those
selected areas, Port operations complied, in all material respects, with applicable state laws,
regulations, and its own policies, and provided adequate controls over the safeguarding of public
In keeping with general auditing practices, we do not examine every transaction, activity, policy,
internal control, or area. As a result, no information is provided on the areas that were not
About the audit
This report contains the results of our independent accountability audit of the Port of Seattle from
January 1, 2020 through December 31, 2020.
Management is responsible for ensuring compliance and adequate safeguarding of public resources
from fraud, loss or abuse. This includes the design, implementation and maintenance of internal
controls relevant to these objectives.
This audit was conducted under the authority of RCW 43.09.260, which requires the Office of the
Washington State Auditor to examine the financial affairs of all local governments. Our audit
involved obtaining evidence about the Port's use of public resources, compliance with state laws
and regulations and its own policies and procedures, and internal controls over such matters. The
procedures performed were based on our assessment of risks in the areas we examined.
Based on our risk assessment for the year ended December 31, 2020, the areas examined were
those representing the highest risk of fraud, loss, abuse, or noncompliance. We examined the
following areas during this audit period:
Financial condition  reviewing for indications of financial distress
Self-insurance for health and welfare, unemployment, workers compensation and paid
family and medical leave
Rent deferral payment plans  compliance with state law
Telework equipment reimbursement policy
Procurement  personal service contracts
Payroll  overtime

Office of the Washington State Auditor                   sao.wa.gov                                               Page 4

A financial statement audit was performed by a firm of certified public accountants. That firm's
report is available on our website, http://portal.sao.wa.gov/ReportSearch. 
Federal grant programs
A firm of certified public accountants evaluated internal controls and tested compliance with the
federal program requirements, as applicable, for the Port's major federal program. That firm's
report is available on our website, http://portal.sao.wa.gov/ReportSearch. 

Office of the Washington State Auditor                   sao.wa.gov                                               Page 5

The Port is a municipal corporation of the State of Washington (the State), organized on
September 5, 1911, under the State statute RCW 53.04.010 et seq. In 1942, the local governments
in King County, Washington (the County) selected the Port to build and operate Seattle-Tacoma
International Airport.
Port policies are established by a five-member Commission elected at-large by the voters of the
County for four-year terms. The Commission appoints the Executive Director (ED), who oversees
daily operations of the organization. Through resolutions and directives, the Commission sets
policy for the Port. These policies are then implemented by the ED and his executive staff.
The Port is composed of three operating divisions, namely, Aviation, Maritime, and Economic
Development. The Aviation Division manages the Airport. The Maritime Division manages
industrial property connected with maritime businesses, recreational marinas, Fisherman's
Terminal, cruise, grain, and maritime operations. The Economic Development Division focuses
on managing the Port's industrial and commercial properties including conference and event
centers, encouraging tourism, developing minority and/or women-owned business opportunities,
and providing for workforce development in the aviation, maritime, and construction industries.
For 2020, the Port had total operating revenues of $510.8 million, which represents a 33.2 percent
decrease from 2019. Total operating expenses decreased from $443.1 million in 2019 to $408.7
million in 2020. The Port's net operating income before depreciation decreased $218.9 million
from 2019 to 2020
Contact information related to this report 
Port of Seattle
Attn: Don Kelley
P.O. Box 1209
Seattle, WA 98111
Contact:   Don Kelley, AFR Senior Manager, General Accounting
Telephone: (206) 787-7042
Website:  www.portseattle.org
Information current as of report publish date.

Office of the Washington State Auditor                   sao.wa.gov                                               Page 6

Audit history
You  can  find  current  and  past  audit  reports  for  the  Port  of  Seattle  at
http://portal.sao.wa.gov/ReportSearch . 

Office of the Washington State Auditor                   sao.wa.gov                                               Page 7

The State Auditor's Office is established in the Washington State Constitution and is part of the
executive branch of state government. The State Auditor is elected by the people of Washington
and serves four-year terms.
We work with state agencies, local governments and the public to achieve our vision of increasing
trust in government by helping governments work better and deliver higher value.
In fulfilling our mission to provide citizens with independent and transparent examinations of how
state and local governments use public funds, we hold ourselves to those same standards by
continually improving our audit quality and operational efficiency, and by developing highly
engaged and committed employees.
As an agency, the State Auditor's Office has the independence necessary to objectively perform
audits, attestation engagements and investigations. Our work is designed to comply with
professional standards as well as to satisfy the requirements of federal, state and local laws. The
Office also has an extensive quality control program and undergoes regular external peer review
to ensure our work meets the highest possible standards of accuracy, objectivity and clarity.
Our audits look at financial information and compliance with federal, state and local laws for all
local governments, including schools, and all state agencies, including institutions of higher
education. In addition, we conduct performance audits and cybersecurity audits of state agencies
and local governments, as well as state whistleblower, fraud and citizen hotline investigations.
The results of our work are available to everyone through the more than 2,000 reports we publish
each year on our website, www.sao.wa.gov. Additionally, we share regular news and other
information via an email subscription service and social media channels.
We take our role as partners in accountability seriously. The Office provides training and technical
assistance to governments both directly and through partnerships with other governmental support
Stay connected at sao.wa.gov            Other ways to stay in touch 
Find your audit team                                    Main telephone:
Request public records                                   (564) 999-0950
Search BARS manuals (GAAP and
cash), and find reporting templates                    Toll-free Citizen Hotline:
Learn about our training workshops                     (866) 902-3900
and on-demand videos 
Discover which governments serve you 
enter an address on our map
Explore public financial data
with the Financial Intelligence Tool 

Office of the Washington State Auditor                   sao.wa.gov                                               Page 8

March 2, 2022
Office of the Washington State Auditor 
700 Fifth Avenue, Suite 4144
Seattle, WA 98104
To the Office of the Washington State Auditor:
We are providing this letter in connection with your audit of Port of Seattle for the period from 
January 1, 2020 through December 31, 2020. Representations are in relation to matters existing
during or subsequent to the audit period up to the date of this letter.
Certain representations in this letter are described as being limited to matters that are significant
or material. Information is considered significant or material if it is probable that it would change
or influence the judgment of a reasonable person.
We confirm, to the best of our knowledge and belief, having made appropriate inquires to be able
to provide our representations, the following representations made to you during your audit. If we
subsequently discover information that would change our representations related to this period, we
will notify you in a timely manner. 

General Representations:
1.      We have provided you with unrestricted access to people you wished to speak with and
made available requested and relevant information of which we are aware, including:
a.  Financial records and related data.
b.  Minutes of the meetings of the governing body or summaries of actions of recent
meetings for which minutes have not yet been prepared.
c.  Other internal or external audits, examinations, investigations or studies that might
concern the objectives of the audit and the corrective action taken to address significant
findings and recommendations.
d.  Communications from regulatory agencies, government representatives or others
concerning possible material noncompliance, deficiencies in internal control or other
matters that might concern the objectives of the audit.
e.  Related party relationships and transactions.
f.   Results of our internal assessment of business risks and risks related to financial
reporting, compliance and fraud.

2.      We  acknowledge  our  responsibility  for  compliance  with  requirements  related  to
confidentiality of certain information, and have notified you whenever records or data
containing information subject to any confidentiality requirements were made available.
3.      We acknowledge our responsibility for compliance with applicable laws, regulations,
contracts and grant agreements.
4.      We have identified and disclosed all laws, regulations, contracts and grant agreements that
could have a direct and material effect on the determination of financial statement amounts,
including legal and contractual provisions for reporting specific activities in separate funds.
5.      We have complied with all material aspects of laws, regulations, contracts and grant
6.      We acknowledge our responsibility for establishing and maintaining effective internal
controls over compliance with applicable laws and regulations and safeguarding of public
resources, including controls to prevent and detect fraud.
7.      We have established adequate procedures and controls to provide reasonable assurance of
safeguarding public resources and compliance with applicable laws and regulations.
8.      Except as reported to you in accordance with RCW 43.09.185, we have no knowledge of
any loss of public funds or assets or other illegal activity, or any allegations of fraud or
suspected fraud involving management or employees.
9.      In accordance with RCW 43.09.200, all transactions have been properly recorded in the
financial records.

X                    X
Stephen P. Metruck                                                    Dan Thomas
Executive Director                                                     Chief Financial Officer

Rudy Caluza
Director, Accounting & Financial Reporting

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