Kirangi 12-07-2010 Committee Briefing

Internal Audit Briefing
Presented to the Port of Seattle
Audit Committee and Tay Yoshitani, CEO
Joyce Kirangi, CPA
Director, Internal Audit
December 7, 2010

Agenda
Audit Report
Lease and Concession Audits
Sodexho America
Smarte Carte
2011 Work Plan Preliminary Discussion
Prior Year Audit Coverage
Preliminary 2011 Audit Coverage

Lease and Concession
Audits
Background
Sodexho America
Vending machine concessionaire
Currently operates 80+ machines throughout the airport
2007-2008 2008-2009 2009-2010
Reported Gross  $1,727,461 $1,517,078 $1,427,206
Concession Paid   649,359   602036  526,870
Smarte Carte
Luggage cart and charging station concessionaire
Currently operates 50+ stations throughout the airport
2007    2008    2009
Reported Gross  $1,086,427  $924,577  $844,276
Concession Paid   530,796   566,253  486,805

Lease and Concession
Audits
Audit Objectives
The purpose of the Lease and Concession audits was to determine whether:
1) Reported concession was complete, properly calculated and remitted timely
to the Port.
2) Port and the lessee complied with provisions of the Lease and Concession
Agreement.
3) Lease and Concession Agreement, as amended, complies with applicable
state and Port requirements.

Lease and Concession
Audits
Audit Result
Sodexho America
Untimely Payments
Management Letter Item
Noncompliance with Business Enterprise Program (RCW
74.18.200 through 74.18.230)
Smarte Carte
Clean Audit Report

2010 Work Plan
Status
2010 Work Plan Status
No. of Audits Exited in 2010
18
No. of Special Projects Completed
4
No. of Ongoing Audits
5 in the wrap-up stage.
6 at/around the end of fieldwork. All fieldwork will be completed by
year end.
Carryover to 2011 Work Plan
5

2011 Work Plan
Discussion
Prior Year Audit Coverage
2008   2009  2010
Aviation              6     13    19
Cap. Dev.           3     0    1
Corp.              1     6    6
Real Estate           7     3     2
Seaport            2     2    1
19    24   29

2011 Work Plan
Discussion
Prior Year Audit Coverage
2008  2009  2010
Aviation           32%   54%   66%
Cap. Dev.         16%         3%
Corp.            5%  25%   21%
Real Estate        37%   13%    7%
Seaport         10%   8%    3%

2011 Work Plan
Discussion
Preliminary 2011 Audit Coverage
Actual       Preliminary*
2007 2008 2009 2010   2011
Systems       1   1   2   1
Department      6   7   7   5       1
rd
3 Party       0   2   1   1
Leases        5   8   11   11      2
Follow-Up       0    0    0    3
Continuous M.    0    0    0    2
Performance     0   0   0   5       2
ERM       0  0  0  1
Contingency      0    1    3    0
12   19   24   29      25
*
includes 2010 carryovers

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