New Comptroller Stringer Audit: Thousands of DOE Computers, Laptops, and Tablets Missing or Not Properly Accounted For

(New York, NY) – A new Comptroller Stringer investigation has found the New York City Department of Education is missing more than 1,800 computers, laptops, and tablets, while more than 3,500 were not properly accounted for. In a sample of just eight schools and one agency office, the Comptroller found 35 percent of approximately 14,000 machines were not properly accounted for.

The follow-up audit released today comes two and a half years after a December 2014 audit by Comptroller Stringer that highlighted how the DOE could not locate 1,817 computers and identified another nearly 400 laptops and tablets that were sitting in storage, unopened and unused.

The Comptroller’s new investigation today revealed that the DOE has made no real progress in managing its technology inventory in the years since. Auditors found:

• An additional 1,816 laptops, computers, and tablets are now missing—from just nine DOE locations audited;
• 3,541 devices that were or should have been at those nine locations were not listed in DOE’s inventory — increasing the risk that DOE equipment can be stolen undetected; and
• The DOE continues to maintain the same decentralized inventory records for its technology equipment that were found inaccurate two and a half years ago and remain so.

“I’m calling on the DOE to do a top-to-bottom review of all of its computers, laptops, and monitors. When we should be preparing our kids for the great age of technology, when coding is changing the world, the DOE is losing and misplacing its tech equipment. This isn’t just a massive mess – it’s wrong. When laptops and tablets go missing, or are stored in closets gathering dust, children and teachers are let down. The ineptitude by the bureaucracy is resulting in wasted resources, and it undermines our ability to prepare our children for the future,” New York City Comptroller Scott M. Stringer said. “The DOE has known about these problems since we audited this very issue over two years ago – and the agency has made no real progress in addressing them. We constantly hear the same excuses from the agency – that monitoring is in place, that systems are functioning the way they should, and that the public should trust that everything is fine. As this audit once again shows, taxpayer dollars are exposed to waste, fraud, or abuse – and it’s coming at our kids’ expense. This has to change.”

Between July 2014 and March 2016, the DOE entered into $209.9 million worth of contracts for computers, laptops, monitors, and tablets with Apple, Lenovo, and CDW Government, LLC. The items purchased through these three contracts included:

• Desktops computers that cost between $332 and $2,290;
• Laptops that cost between $167 and $2,339;
• Tablets that cost between $251 and $900; and
• Computer monitors that cost between $94 and $452.

Comptroller Stringer’s December 2014 audit found that the DOE was unable to properly manage its technology hardware due in large part to its decentralized inventory system. Today’s follow-up audit found that those failures have continued.

Currently, more than 2,000 individual “site administrators” across the school system are responsible for maintaining and updating their own computer inventories, which are never reconciled with the DOE’s central purchasing database or its Asset Management System (AMS). As a result, the DOE has no way of knowing whether all of the items it purchased are properly accounted for at school locations. These systemic failures expose the City to an increased risk of waste, fraud, and abuse.

In the earlier audit, the Comptroller recommended the DOE establish a centralized inventory system — possibly through the existing AMS database, which already contains information on hardware purchased by the DOE. Today’s follow-up audit showed the results of DOE’s rejection of that and other recommendations — still more missing and unused equipment — and revealed that the DOE had not even tried to find 1,090 of the 1,817 computers that were identified as missing in the December 2014 audit.

Findings from the follow-up audit include:

The DOE’s records remain inaccurate and incomplete

The DOE failed to properly account for 4,993 of its 14,329 pieces of computer hardware — or 34.9 percent of the total — at the nine sampled sites. Of those 4,993 items:

• Auditors looked for — but DOE was unable to produce — 1,816 pieces of computer hardware during physical inspections; and
• Auditors found that 3,541 pieces of computer hardware were not listed in the locations’ inventory records.

No centralized system for monitoring inventory

The previous audit recommended that the DOE revise its Standard Operating Procedures to record all computer hardware purchases in AMS and ensure that annual inventory counts are conducted and reconciled with the information in AMS. Yet, the DOE continues to refuse to implement that recommendation, citing costs, despite the potential for fraud and wasteful spending.

The DOE did not monitor recordkeeping procedures at schools and administrative sites

DOE fails to ensure that its inventory records are accurate and complete. The Department’s unmonitored, decentralized inventory system — in which site administrators from each of DOE’s 2,278 sites are responsible for maintaining and updating inventory records — are never checked against central databases of purchases. This puts computer hardware at a higher risk of being lost, stolen, and wasted.

The DOE accounted for only 12.9% of the items that were previously identified as missing

In today’s audit, the DOE accounted for only 234 of the 1,817 missing pieces of computer hardware identified in the previous audit — or 12.9 percent. The findings are broken down below.

• The DOE reported that it did not attempt to locate 1,090 computer items, most of which were listed in AMS as “location unknown.”
• Of the remaining 727 pieces of missing hardware identified in the 2014 audit, the DOE reported that it had located 353 items at eight sites.
• However, when the Comptroller’s office attempted to inspect 188 of those items at two of the sites, DOE could account for only 69 of them, or 36.7 percent.
  • The DOE claimed it had identified 162 of the missing items at the sampled DOE administrative office, but when auditors visited, they only found 69 of them.
  • Although the DOE claimed that 26 pieces of computer hardware were located at a single school, the DOE did not provide the auditors with access to that school to verify their claims.

The DOE did not provide schools and other decentralized sites with sufficient guidance and support to ensure compliance with its inventory guidelines

During interviews with DOE staff at nine sampled sites, auditors were told that they were not aware of — and did not receive access to — inventory training, AMS data, and other vendor inventory services, all of which should have been in place to help properly track computer equipment.

To address the issues that were identified in the earlier audit and the persistent problems uncovered in the follow-up audit, the Comptroller’s office issued 19 recommendations, emphasizing the need for the DOE to establish a single centralized system for monitoring its hundreds of millions of dollars’ worth of  computer hardware.

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