Internal Audit Briefing
Presented to the Port of Seattle
Audit Committee and Tay Yoshitani, CEO
Joyce Kirangi, CPA
Director, Internal Audit
June 7, 2011

Agenda
Audit Report
Comprehensive Operational Audit
Sea-Tac Utilities
Public Parking  Aviation Landside Operation
Third-Party Arrangements Operational Audit
Sea-Tac Airport Lost and Found
Limited Operational Audit
Mobile Devices/Smartphones
Concession and Lease Audit
None

Comprehensive Operational Audit
Sea-Tac Utilities

Background
The department generates on average $6 million in annual
tenant direct billing revenues and incurs approx. $14 million
per year in operating expenses. Below are direct billing
revenues by utility for the past three years.
(in thousands)       2008         2009        2010
Electric           3,128    52%  3,432    57%  3,498  55%
Surface Water     1,115   19% 1,115   18% 1,144  18%
Water          951   16%  780   13%  803  13%
Sewer and Others    780   13%  724   12%  930  14%
Total            5,974   100%  6,051   100%  6,375  100%
Source: PeopleSoft

Comprehensive Operational Audit
Sea-Tac Utilities

Audit Objectives
The purpose of the audit was to determine if management has
implemented adequate controls to assure that:
1.Utility billing is complete, accurate and in accordance with the tariff.
2.Costs in the utility rate calculation are relevant, reasonable and
complete.
We reviewed information relating to fiscal year 2010.

Comprehensive Operational Audit
Sea-Tac Utilities

Audit Result
Clean Audit Report

Comprehensive Operational Audit
Public Parking

Background
The Port of Seattle owns and operates the Seattle-Tacoma
International Airport (STIA) public parking garage. The
parking garage offers 13,000 parking stalls and generates
approximately $50 million in revenues annually. Below are
revenues and expenses for the past three years.
(in thousands)            2008     2009     2010
Parking Revenues         $ 53,548  $ 44,797  $ 45,060
Operating Expenses        $ 6,450   $ 5,628   $ 5,705
Source: PeopleSoft

Comprehensive Operational Audit
Public Parking

Audit Objectives
The purpose of the audit was to determine if management has adequate
controls to ensure effective parking operations in compliance with
applicable requirements.
Specifically, whether monitoring controls are working effectively as
intended in the following areas:
Complete and proper processing of high-risk transactions
Overtime compensation was proper and for actual time worked
The scope of the audit included a one-year period from January 1, 2010 to
December 31, 2010.

Comprehensive Operational Audit
Public Parking

Audit Result
One Finding
"  Incomplete Management Monitoring of Exception Parking
Transactions

Third-Party Arrangements Operational Audit
Sea-Tac Airport Lost and Found

Background
In 1998, Sea-Tac Airport's Lost and Found Program was
contracted to Washington Works. The Port's goal was three-
fold: 1) support Washington Works' welfare to work program, 2)
serve the traveling public with an effective Lost and Found
operation and 3) comply with applicable state laws that govern
Lost and Found property. Following the dissolution of
Washington Works in 2002, YWCA has been operating Lost and
Found with 4.5 FTEs at an annual contract cost of $285,000.
On average, Lost and Found handles 20,000 items annually.
Approximately, 90% of the items are either returned to owners or
donated to charities.

Third-Party Arrangements Operational Audit
Sea-Tac Airport Lost and Found

Audit Objectives
The purpose of the audit was to determine whether management has implemented
adequate controls to ensure:
Inventory items properly claimed, donated, transferred to Port use or disposed of
Inventory items donated to bona fide charities
Small and attractive items in inventory can be accounted for
Receipts issued for found items can be accounted for in the inventory system
Compliance with contract requirements
Compliance with applicable laws
We reviewed information relating to the period January 1, 2008, through December
31, 2010, including activity through the end of fieldwork in early May 2011.

Third-Party Arrangements Operational Audit
Sea-Tac Airport Lost and Found

Audit Result
Clean Audit Report

Limited Operational Audit
Mobile Devices/Smartphones Review

Background
The Port started providing mobile devices in the early 1990's,
primarily to Fire and Police Department staff. Since then,
the issuance has been steadily increasing and stabilized to
approximately 780+ smartphones and 200+ air cards as of
December 31, 2010.
The Port incurs approximately $ 580,000 annually for
services related to the smartphone plans.

Limited Operational Audit
Mobile Devices/Smartphones Review

Audit Objectives
The purpose of the audit was to determine if the Port is effectively managing
mobile devices.
Specifically, whether management:
Provides sufficient, complete, and clear policy directives and governance on
proper mobile device usage.
Monitors usage adequately to ensure that Port issued smartphones are utilized for
the intended productivity benefits.
Has implemented adequate controls over usage levels and negotiated rate
structures to ensure the best economic interest of the Port.
We reviewed current Port practices based on billings and usage data from 2010.

Limited Operational Audit
Mobile Devices/Smartphones Review

Audit Result
One Finding
"  Inadequate Management Controls and Unclear Policy Regarding
Smartphone Usage