The City of New York Office of the Comptroller Bureau of Management Audit

Audit Report on the Financial Practices of the Independent Budget Office

ME04-076A
June 18, 2004

AUDIT REPORT IN BRIEF

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This audit of the financial practices of the Independent Budget Office (IBO) determined whether the agency has adequate controls over its timekeeping, payroll, purchasing, and inventory operations. IBO is a publicly funded agency established in 1996 to enhance official and public understanding of the New York City budget, the largest municipal budget in the country. In Fiscal Year 2003, IBO’s operating budget was $2,764,085 including $2,336,147 for personal services and $427,938 for other than personal services. During Fiscal Year 2003, IBO employed 12 managerial and 24 non-managerial employees.

Audit Findings and Conclusions

IBO generally had adequate controls over its timekeeping, payroll, purchasing, and inventory practices. Specifically, IBO had adequate segregation of duties for timekeeping, payroll, and purchasing operations. IBO also adequately monitored, accounted for, and properly safeguarded its physical assets, charged purchases to the correct object codes, and sufficiently solicited bids. However, we also identified some weaknesses in IBO’s operations. Specifically, we found that IBO:

• did not use a purchase requisition for all purchases;
• did not maintain adequate supporting documentation in the purchase files for some imprest fund and miscellaneous voucher purchases;
• did not have adequate controls over employee daily sign-in sheets; and
• provided one employee a salary that exceeded the salary range for the employee’s civil service title.

Audit Recommendations

To address these issues, we make six recommendations, among them that IBO should:

• Prepare and maintain a purchase requisition, or a similar document, for each purchase.
• Ensure that invoices and receipts are consistently obtained and maintained in the purchase files for imprest fund and miscellaneous voucher purchases.
• Maintain a daily timekeeping system to record the attendance, absence, or tardiness of all non-managerial employees.
• For the employee whose salary is not within the civil service title limit, adjust the employee’s salary or transfer the employee to a civil service title with a salary range encompassing the current pay level.