Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

INTERNAL AUDIT REPORT 
LIMITED CONTRACT COMPLIANCE 
SIXT RENT A CAR 

JUNE 2015  DECEMBER 2018 


ISSUE DATE: FEBRUARY 25, 2019 
REPORT NO. 2019-3 



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Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

TABLE OF CONTENTS 

EXECUTIVE SUMMARY ........................................................................................................................................... 3 
BACKGROUND ........................................................................................................................................................ 4 
AUDIT SCOPE AND METHODOLOGY ..................................................................................................................... 5 
SCHEDULE OF FINDINGS AND RECOMMENDATIONS......................................................................................... 6 
APPENDIX A: RISK RATINGS .................................................................................................................................. 7 













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Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

EXECUTIVE SUMMARY 
Internal Audit (IA) completed an audit of the Lease Agreement (Agreement) between Sixt Rent A Car 
(Sixt) and the Port of Seattle (Port) for the period June 1, 2015 through December 31, 2018. The audit
was performed to determine whether Sixt complied with significant provisions of the Agreement including
whether reported gross revenues and the Customer Facility Charges (CFC) paid to the Port were
complete and accurate. 
We determined that Sixt underreported certain gross revenue items. 
1) Sixt did not report $432,991 in incidental gross revenues, resulting in $43,299 in additional Percentage
Fees owed to the Port for the period under audit. 
This issue is discussed in more detail on page six. 
We extend our appreciation to management and staff of the Aviation Business Development Department,
Sixt, and the Accounting and Financial Reporting Department for their assistance and cooperation during
the audit. 


Glenn Fernandes, CPA 
Director, Internal Audit 






RESPONSIBLE MANAGEMENT TEAM 
Geoffrey Foster, Aviation Property Manager 
Lance Lyttle, Managing Director, Aviation 
Jim Schone, Director, Aviation Business Development 

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Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

BACKGROUND 

Founded in 1912 in Munich, Germany, Sixt has grown its vehicle rental and leasing business worldwide.
Today, the Sixt brand is represented in over 105 countries with branches in over 2,200 locations. Sixt
entered the US market in 2011 with a strategy to focus and expand on strong-growth airport and
downtown stations, which included the Seattle-Tacoma International Airport location. 
In  December  2012,  the  Port  entered  into  a  Consolidated  Rental  Car  Facility  Lease  Agreement
(Agreement) with Sixt. The terms of the Agreement provide for a Minimum Annual Guarantee (MAG)
equal to 85% of the total amount paid to the Port for the previous Agreement year. Additionally, the
Agreement requires a Percentage Fee equal to 10% of gross revenues, provided the fee is higher than
the monthly MAG. The MAG is payable in advance, on or before the first day of each month. The
Percentage Fee, if applicable, is due on or before the 20th of the following month.
The Agreement states that the Operator must collect a Customer Facility Charge (CFC) of $6 per rental
day, and remit the full amount to the Port regardless of whether or not the full amount is actually
collected. 
The table below reflects total Gross Revenues, Percentage Fees, and CFC fees: 
Agreement Year                Gross Revenue        Percentage Fees              CFC Fees 
June 2015  May 2016              $11,789,036              $1,178,904              $1,373,892 
June 2016  May 2017               11,905,434               1,190,543               1,227,552 
June 2017  May 2018               13,650,284               1,365,028               1,357,818 
June 2018  Dec. 2018*              11,969,600                1,196,960                1,042,020 
Total                                   $49,314,354                $4,931,435                $5,001,282 
Data Source: PeopleSoft Financials and PropWorks 
* Reflects a period of seven months that was added to scope. 







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Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

AUDIT SCOPE AND METHODOLOGY 

We conducted this 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. 
The period audited was originally from June 2015 through May 2018; during the course of our work we
expanded the period under audit, to December 2018. After identifying significant provisions in the
Agreement, we performed audit procedures that included: 
Revenue Completeness and Accuracy 
Traced concession payments to Port records to verify payments were received by Agreement
dates.
Agreed revenues reported to the Port, to the Operator's general ledger, revenue reports, and to
the independently audited schedules. 
Customer Facility Charge 
Agreed Operator's audited CFC counts to daily transaction records. 
Reviewed checkout and return date records to assess the reasonableness of daily transactions. 
Insurance and Rent Security 
Determined whether commercial general liability insurance and rent security complied with
Agreement terms. 









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Sixt Rent A Car                                                                                    INTERNAL AUDIT 
June 2015 - December 2018 

SCHEDULE OF FINDINGS AND RECOMMENDATIONS 
1) RATING: MEDIUM
Sixt did not report $432,991 in incidental gross revenues, resulting in $43,299 in additional
Percentage Fees owed to the Port for the period under audit. 
Our analysis of the Operator's financial records and testing of transactions, identified the following items
that were not included in Gross Revenues, when reported to the Port: 
Reservation cancellation fees                Vehicle upkeep recovery 
Administrative fee for tolls                     Counter processing recovery 
Tickets 
The Operator has acknowledged these items. The underreported revenue is reflected in the table
below. 
Agreement Year           Gross Revenues             Audited      Difference    Percentage Fee 
June 2015 - May 2016          $11,789,036         $11,805,856        $16,820            $1,682 
June 2016 - May 2017           11,905,434          12,056,530        151,096            15,109 
June 2017 - May 2018           13,650,284          13,801,722        151,438            15,144 
June 2018 - Dec 2018*           11,969,600          12,083,237        113,637            11,364 
Total                               $49,314,354          $49,747,345        $432,991            $43,299 
Data Source: PeopleSoft Financials, Propworks, and Sixt records 
* Reflects a period of seven months that was added to scope. 
Recommendations: 
1. Seek and recover $43,299 in underpaid Percentage Fees. 
2. Assess the applicability of a one-time late charge and any accrued interest. 
3. Communicate with the Operator, to assure that future reported Gross Revenues include the items
listed above. 
Management Response / Action Plan: 
Aviation Commercial Management staff will seek to recover the underpaid Percentage Fees, together
with any applicable late fees and interest charges. Aviation Commercial Management staff will also
clearly communicate to the tenant that the revenues identified above, are not permitted exclusions
from revenue according to the Agreement. Therefore, effectively immediately, those revenue items are
required to be included in their monthly reports of gross revenues provided to the Port. Revised
reports that include these excluded gross revenues, as well as payment of any additional Percentage
Fees, will be requested for those months that have transpired since the end of the audit period. 
Since gross revenue exclusions appear to be a common point of audit findings, Aviation Commercial
Management staff will reengage with all rental car tenants at the Consolidated Rental Car Facility
regarding the acceptable gross revenues exclusions. The goal of this reengagement is to reduce
similar findings concerning acceptable gross revenue exclusion during future audits. 
DUE DATE: 5/31/2019 

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Sixt Rent A Car 
June 2015  May 2018 

APPENDIX A: RISK RATINGS 
Findings identified during the course of the audit are assigned a risk rating, as outlined in the table below.
The risk rating is based on the financial, operational, compliance or reputational impact the issue identified
has on the Port. Items deemed "Low Risk" will be considered "Exit Items" and will not be brought to the final
report. 
Port Commission/
Rating        Financial         Internal Controls         Compliance           Public 
Management 
Large financial
impact                                    Noncompliance
High probability
with applicable                               Important 
Missing, or inadequate                         for external audit
Remiss in                                 Federal, State,
HIGH                       key internal controls                        issues and/or
responsibilities                                   and Local Laws,                           Requires immediate
negative public
of being a                                    or Port Policies                               attention 
perception 
custodian of
public trust 
Partial controls             Inconsistent          Potential for      Relatively important 
compliance with      external audit
Moderate
MEDIUM                  Not adequate to identify    Federal, State,     issues and/or     May or may not
financial impact 
noncompliance or       and Local Laws,     negative public     require immediate
misappropriation timely      or Port Policies         perception            attention 
Generally
Internal controls in place                            Low probability
complies with
but not consistently                             for external audit
Federal, State and                       Lower significance 
Low financial       efficient or effective                              issues and/or
LOW/                                         Local Laws or Port
impact                                                         negative public
Exit Items                                                  Policies, but some                         May not require
Implementing/enhancing                         perception 
minor                          immediate attention 
controls could prevent
discrepancies
future problems 
exist 
Efficiency    An efficiency opportunity is where controls are functioning as intended; however, a modification would make
Opportunity                                        the process more efficient 







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