March 1, 2017

The Honorable Bill de Blasio, Mayor
City of New York
City Hall
New York, NY  10007

The Honorable Melissa Mark-Viverito, Speaker
New York City Council
250 Broadway, Suite 1850
New York, NY  10007

New York City Council
City Hall
New York, NY  10007

Dear Mayor de Blasio, Speaker Mark-Viverito and Members of the City Council:

Attached please find the annual report on the operations of the Audit Bureau of the New York City Comptroller’s Office for Fiscal Year 2016.  My Audit Bureau issued 73 audits and special reports during the fiscal year focused on the effectiveness and service quality of City programs and on financial issues, identifying approximately $22.1 million in actual and potential revenue and savings.  Reviews of claims filed against the City identified another $495,733 in potential cost avoidance.  This annual report contains the significant findings and recommendations of the Comptroller’s audit activities during Fiscal Year 2016 and the follow-up actions the auditees identified in response to our audit recommendations.

Under the City Charter, the Comptroller’s Office must audit some aspect of every City agency at least once every four years in accordance with generally accepted government auditing standards promulgated by the Comptroller General of the United States.  It also has a mandate to perform financial audits of City transactions, revenues and expenditures to determine whether agencies are meeting their goals, and whether funds are being used effectively and efficiently.  Section 93 (f) of the City Charter states that no later than March 1st of each year the Comptroller must provide such a report to the Mayor and City Council on all major audit activities of City agencies conducted in the previous fiscal year.

These auditing standards also require that government auditing entities undergo an external peer review every three years.  This year, the Audit Bureau underwent such a review by a team of qualified independent audit professionals that was completed in October 2016.  It is my pleasure to report that the Comptroller’s Office complies with generally accepted government auditing standards and received the highest of three possible ratings from the review panel.  In addition, the peer review identified eight specific areas of the audit bureau’s performance for which it should be commended.

The audits issued in Fiscal Year 2016 covered a wide range of subjects in revenue, cost savings, asset management, internal controls, service delivery, program performance, and information technology.  The most significant findings are highlighted below.

Revenue and Cost Savings

The following are brief descriptions of audits that generated the most actual and potential revenue and savings:

  • An audit found that the Department of Finance (DOF) allowed 1,249 ineligible condominium owners to receive 3,471 tax abatements under the New York State Cooperative and Condominium Tax Abatement Program for Fiscal Years 2013 through 2016, resulting in lost property tax revenue of at least $10,018,348. The ineligible owners included 1,085 corporations and Limited Liability Corporations (LLCs) and the owners of 164 non-residential condominiums such as parking spaces, storage units, and other commercial facilities.  The Office’s follow-up report issued five months after the audit’s release confirmed that DOF removed the abatements from 920 ineligible properties, which will result in the City’s gaining $3,224,577 in revenue for the 2016/2017 tax year.  That gain will continue each year as long as the properties are owned by corporations or LLCs, or are classified for non-residential use.  However, the follow-up review also found that DOF failed to remove the abatements from 295 ineligible properties, which will allow the continued loss of property tax revenue in the amount of $651,413 for Fiscal Year 2017.  In addition, the review found that DOF did not remove the School Tax Relief (STAR) or Enhanced STAR exemption from 72 properties owned by a corporation or an LLC, which allows the continued loss of an additional $25,008 in property tax revenue.
  • An audit reviewed DOF’s billing of Payments in Lieu of Taxes (PILOT), a property tax incentive used to induce commercial, industrial and manufacturing businesses to undertake major capital investments that are expected to result in the creation and retention of jobs in New York City.  The City exempts property holders from paying real property taxes and agrees to accept instead a set PILOT payment (less than the expected real estate tax) for a period of years.  Currently, DOF manually calculates and bills the PILOT amount due based on the terms negotiated between the New York City Industrial Development Agency (IDA) and individual project owners.  The audit found inaccuracies in DOF’s PILOT-related billing totaling $3.5 million during the period under review.  Of this amount, DOF under-billed a total of $1.3 million for four IDA PILOT projects, failed to place the properties of two terminated projects back onto the City tax roll in a timely manner, which resulted in $478,533 in additional previously uncollected tax revenue, and overbilled two property owners approximately $1.7 million.
  •  Two audits of the tax classification of real property, one in Brooklyn and one in Queens, found that DOF could bill property owners for an additional $3.37 million in real estate taxes if properties were correctly classified.  During Fiscal Year 2015, DOF collected $21.5 billion in property taxes citywide.
    • In the Brooklyn audit, auditors found that DOF did not have adequate procedures in place to ensure that properties listed on the assessment rolls as mixed-use within Tax Class 1, 2a, or 2 – buildings ranging in size from one to ten units – were correctly classified.  Based on inspections of mixed-use properties in July 2015, the auditors identified 197 out of 15,952 properties that appeared to be misclassified.  Using DOF guidelines, the auditors calculated that if DOF properly classified the 197 properties, it would bill those property owners an additional $2.09 million in taxes over a five-year period.
    • In the Queens audit, auditors identified 154 out of 4,607 properties listed as Tax Class 1 – those with three or fewer units – that appeared, based on our preliminary analysis, to have been misclassified.  DOF subsequently re-inspected the 154 properties, confirmed that 78 had been incorrectly classified, determined that 19 properties required an interior inspection, and reported that 57 required no change.  The audit revealed some weaknesses in DOF’s assessment process as evidenced by the fact that several of the properties DOF agreed had been improperly classified had been inspected by the agency not long before the audit.  Using DOF guidelines, auditors calculated that if DOF reclassified the 97 properties (the 78 DOF agreed were incorrectly classified plus the 19 that required an interior inspection), it would bill property owners an additional $1.28 million in taxes over a five-year period.

Asset Management and Internal Controls

The following are brief descriptions of audits of a number of agencies or public entities that identified significant deficiencies in asset management and internal controls:

  • An audit of the Queens Borough Public Library (QBPL) assessed the internal controls in its financial and operating practices to ensure that expenditures were necessary, appropriately authorized and accurately recorded in compliance with applicable laws, rules, and regulations governing the use of QBPL’s funds. In Fiscal Year 2014, the QBPL circulated approximately 15.8 million books and other materials and reported nearly 11.2 million attendees.  For Fiscal Years 2008 to 2013, the QBPL received between $121 and $129 million per year in revenue and support.  The audit found that the QBPL failed to ensure that adequate financial controls were in place to properly allocate and expend its resources.  Among the weaknesses the audit found were a lack of oversight over credit card expenditures, a failure to properly account for managerial employees’ work hours, and a failure to report compensation on certain executive employees’ federal W-2 compensation disclosure forms.  Further, we found that the QBPL failed to substantiate its bases for repeatedly allocating in its financial records the majority of the Library’s expenditures to the Library’s City Fund, which caused that fund to operate with multi-year deficits, while other, non-City, unrestricted funds had surpluses that could have been used for these expenditures.  At the same time, we found that despite the availability of these unrestricted funds, QBPL executives repeatedly requested additional funding from the City to cover basic operating costs, while using non-City funds that had previously been shielded from the Comptroller’s audits to pay for many questioned expenditures.  Finally, the audit could not substantiate the reasonableness of the QBPL management’s decision to increase management compensation while it decreased Library hours and reduced staff, all during a period when the Library reported it was experiencing severe financial difficulties.  In connection with this audit, the Comptroller’s Office performed an investigation, including a thorough analysis of the credit card purchases by the QBPL’s two most senior executives for Fiscal Years 2012 through 2014, and a review of the CEO’s record of time spent on outside consulting services and City filings.  The investigation found more than $310,000 in prohibited purchases, inaccurate time records, and false statements on government filings.
  • An audit of the New York City Housing Authority’s (NYCHA) completion and reporting of Work Orders found that NYCHA did not meet its goals of eliminating its Work Order backlog and permanently reducing repair wait times. With approximately 400,000 residents in 328 developments in all five boroughs, NYCHA is responsible for addressing all Work Orders, including Corrective Maintenance (Complaints), Inspections, Preventive Maintenance, and Violations.  In January 2013, NYCHA reported that it had a backlog of more than 420,000 Work Orders.  As of April 2015, NYCHA reported that it had 120,730 open Work Orders and that, on average, it took NYCHA 35 days to complete repairs.  The audit found, however, that in its performance reports to the public, NYCHA significantly understated the total number of open Work Orders, the average amount of time it takes NYCHA to complete Work Orders, and its backlog of open Work Orders.  To the extent that NYCHA reported dramatic reductions in the number of open Work Orders and the time it took to complete repairs, we found, at least in part, those reductions resulted from NYCHA’s making administrative changes in the way it categorized and closed Work Orders rather than from actually performing repairs more quickly.  Also, in April 2014, NYCHA had entered into a Stipulation and Order of Settlement with residents who alleged they suffered from asthma and that NYCHA failed to make reasonable accommodations and modifications in its policies, practices, and procedures to effectively abate mold, mildew, and/or excessive moisture conditions.  The review found that NYCHA did not train staff, appropriately identify the nature and severity of mold, mildew, and/or excessive moisture conditions, or assign qualified staff to assess these conditions and design and perform satisfactory remediation work.
  • An audit was conducted of the Department of Sanitation’s (DSNY) controls over its 5,388 vehicles and related supplies used to collect the City’s solid waste, including the collection of refuse and recyclables, and the cleanliness of City streets. In addition, since the Mayor signed Executive Order 161 on April 23, 2012, which consolidated the maintenance of motor vehicle fleets for City agencies, DSNY is also responsible for the maintenance of medium and heavy-duty vehicles for four other agencies: the Department of Health and Mental Hygiene, the Department of Education, the Department of Parks and Recreation, and the Department of Environmental Protection.  According to a DSNY Fiscal Year 2015 Inventory Valuation report, as of June 30, 2015, the parts inventory was valued at over $18.7 million.  The audit found that DSNY needs to strengthen its controls over the monitoring of its inventory of vehicle equipment and supplies.  DSNY had insufficient evidence that discrepancies between amounts of stock on hand and amounts recorded were investigated when identified.  The audit also found that DSNY did not ensure that staff’s inventory management computer system user rights did not exceed their levels of responsibility, nor did DSNY ensure that there was adequate segregation of duties.  DSNY also did not perform periodic counts of its entire inventory to ensure the accuracy of its perpetual inventory records.  Although auditors’ counts of sampled items found minimal differences between the amounts of stock on hand and the amounts recorded for six of the eight locations sampled, there is no reasonable assurance that the inventory balances recorded in DSNY’s inventory management computer system reflect all authorized additions and depletions.  The audit also revealed that DSNY: 1) had not developed written procedures that detail the steps for processing issuances, transfers, and adjustments; 2) had not enforced a protocol for relinquishing obsolete inventory; and 3) had certain items incorrectly valued at $0 per unit.
  • An audit of Housing Preservation and Development’s (HPD) effort to develop City-owned vacant lots found that the City owns over a thousand vacant lots that could be developed under existing urban renewal programs, but many of these lots have been allowed to languish and remain undeveloped for up to 50 years or longer. While HPD contended that over the years it has disposed of most of the lots for which it has been responsible, the audit found that as of September 18, 2015, HPD listed 1,131 vacant lots under its jurisdiction.  Further, the audit found that although HPD solicits developers to build on these properties, it had not established plans with realistic time schedules to actually transfer these vacant lots to developers.  Finally, the audit identified an additional 340 City-owned vacant lots under the jurisdiction of other City agencies that could be considered for use for residential construction.
  • The Comptroller’s Office conducted audits of the financial and operating practices of three charter schools: South Bronx Charter School for International Cultures and the Arts (South Bronx), Merrick Academy Queens Public Charter School (Merrick), and the Bedford Stuyvesant New Beginnings Charter School (BSNBCS). Each audit examined the school’s oversight over its fiscal affairs during Fiscal Years 2013 and 2014 to determine whether its internal controls ensured that funds were appropriately expended, authorized, valid, and reasonable; whether transactions were accurately recorded and reported; and whether potential conflicts of interest and related party transactions were adequately disclosed and approved.
  • South Bronx enrolled 390 and 385 students and reported revenue of $5.72 million and $5.67 million and expenses of $4.84 million and $4.20 million, respectively in Fiscal Years 2013 and 2014 resulting in operating surpluses of $919,443 and $1,470,133. The audit found that South Bronx failed to adequately document ($104,915) and properly authorize ($31,151) nearly 15% of sampled expenditures.  South Bronx also employed a greater number of uncertified teachers than permitted under its charter agreement.
  • Merrick enrolled 499 and 500 students and reported revenue of $7.08 million and $7.14 million and expenses of $6.89 million and $7.84 million, respectively, in Fiscal Years 2013 and 2014, resulting in an operating surplus of $190,886 followed by an operating deficit of $696,872. In Fiscal Year 2014, Merrick also incurred a non-recurring loss of $815,058 due to a relocation of the school, which resulted in a total deficit of $1.51 million.  The audit found that Merrick had established policies and procedures designed to facilitate fiscal management and oversight, but it failed to: 1) consistently follow them; 2) use written contracts or purchase orders as required; 3) ensure that payments made to vendors were adequately supported and properly authorized; 4) pay invoices in a timely manner; and 5) maintain an inventory of fixed assets.  In addition, Merrick failed to comply with New York State Education Law requirements for employees’ criminal background checks.
  • BSNBCS enrolled 328 and 428 students and reported revenue of $5.71 million and $16 million and expenses of $5.76 million and $6.74 million, respectively, in Fiscal Years 2013 and 2014, resulting in an operating deficit of $588,368 followed by an operating surplus of $418,343. The audit found that BSNBCS improved its financial condition as a result of its Board’s active oversight.  However, it also found that BSNBCS: 1) lacked contracts and related documents to support $1.66 million in reported construction costs; 2) did not properly account for cash receipts amounting to at least $97,000; 3) did not maintain $70,000 in escrow account as required; and 4) did not submit required Financial Disclosure Reports in a timely manner.

Service Delivery and Program Performance

The following are brief descriptions of audits that disclosed the most significant service-delivery and program-performance issues:

  • An audit of the Department of Homeless Services (DHS) determined that DHS did not have sufficient controls to ensure that units within the shelter facilities where it placed homeless families with children were adequately maintained, that the needs of homeless families were assessed in a timely manner, or that the families received appropriate services, including those designed to assist them to transition to permanent housing. During the audit’s scope period (Fiscal Year 2013 through October 2015), only 14 Program Analysts were assigned to oversee the provision of services at 155 family shelters housing approximately 12,500 families.  Given the extent of oversight required, DHS did not apply sufficient resources to ensure that these families received mandated services.  The audit’s inspections of 101 apartments at eight randomly selected shelters found that the majority had one or more conditions that raised health and safety concerns, including rodent and roach infestation, peeling paint, water damage, and mold on bathroom ceilings.  In addition, because DHS did not maintain overall performance data on whether shelter providers developed families’ Independent Living Plans (ILPs) in a timely manner or monitored families’ progress in meeting ILP goals, the audit was unable to determine whether such services generally were provided as required.  The audit also found a number of security issues during visits to the eight sampled shelters.
  • An audit was conducted to determine whether the Administration for Children’s Services (ACS) had sufficient controls over its process for investigating allegations of child abuse and neglect. The audit revealed that although ACS established formal guidelines that govern the process, the agency did not develop sufficient controls to ensure that those guidelines were followed.  The audit found limited evidence that supervisors and managers performed required case reviews on a consistent basis.  This is due in large part, we believe, to management’s failure to develop an effective mechanism to gauge compliance with investigatory guidelines.  The audit also questioned whether ACS applied sufficient resources to support the investigatory function.  These weaknesses hindered ACS’ ability to ensure that investigatory steps were conducted in a timely manner.  Insufficient oversight to ensure that ACS staff consistently follow guidelines and directives weakens any controls that may be established and increases the risk that investigatory results may be flawed.  Consistent with this concern, the audit’s review of 25 sampled cases revealed multiple areas within each case where staff did not adhere to ACS guidelines and that these issues were not detected during the course of the investigation.
  • Another audit of ACS found that the agency had inadequate controls in place to effectively monitor its Close to Home (CTH) Non-Secure Placement (NSP) Program for young people considered lower risk who have been ordered into ACS custody by the New York City Family Court, based on a finding of commission of a delinquent act. The audit found limited evidence that ACS verified that services reportedly provided by the contracted non-profit providers to the youth in ACS’ care were actually provided, or that all required contacts with the youth and their parents or legal guardians took place.  In addition, there was inadequate evidence that ACS Placement and Permanency Specialist (PPS) staff discussed all reported incidents, such as AWOLs, assaults, and altercations, with the youths involved and verified that the CTH NSP providers documented their efforts to debrief youths involved in incidents.  With regard to monitoring the performance of NSP non-profit providers overall, the audit found inadequate evidence that ACS performed all required site visits, which include conducting periodic unannounced visits as mandated by the City’s Procurement Policy Board Rules.  For those site visits that did take place, the audit found that ACS did not adequately assess the NSP sites’ operations or adequately track the CTH NSP providers’ implementation of corrective actions to address the deficiencies that ACS identified.  In addition, the audit found that ACS did not adequately assess CTH NSP providers’ performance and lacked sufficient documentation to support the performance evaluations it recorded in the City’s VENDEX System.
  • An audit found that Human Resources Administration (HRA) had inadequate controls in place to ensure that vendors were providing services to HIV/AIDS Services Administration (HASA) clients in accordance with their agreements. The housing inspection database HRA developed to track housing inspections was found to be unreliable, and there was no evidence that housing inspections were consistently conducted in a timely manner or that inspection results were formally and promptly shared with vendors.  The audit also found that HRA did not ensure that key contract terms were followed or that assessments of customer satisfaction were performed as required by Procurement Policy Board Rules.  In addition, the audit identified a number of instances in which HRA continued to pay vendors for clients after they were reported as deceased and found weaknesses in HRA’s oversight designed to ensure fiscal accountability for its vendors.
  • An audit assessed the Metropolitan Transportation Authority’s (MTA) controls over Access-A-Ride (AAR) contractor billing and payments and determined whether the MTA adequately monitored AAR contractors to ensure that they provided paratransit services in a timely manner. The agreement between New York City and MTA New York City Transit authorizes the MTA’s Paratransit Division (Paratransit) to administer and operate AAR.  The audit found that Paratransit failed to effectively monitor AAR contractors’ compliance with contract requirements for reliable and timely customer service and accurate reporting of pick-up and drop-off times.  As a result, customers suffered from unreliable and unsatisfactory service.  Further, Paratransit overpaid its contracted vendors, made additional questionable payments and failed to effectively manage the contracts to ensure better service and to obtain cost savings.  Paratransit also missed significant cost savings opportunities by failing to direct DSCs to implement service efficiencies that were available as of 2009.  These efficiencies could enable Paratransit to save $1.4 million annually.  Finally, Paratransit did not ensure that Reservation Agents offered customers the most cost-effective travel options.
  • An audit assessed the adequacy of the Department of Health and Mental Hygiene’s (DOHMH) controls to ensure that center-based Group Child/Day Care (GDC) providers that are granted permits to operate in the City have fulfilled applicable regulatory requirements. DOHMH’s Bureau of Child Care (BCC) is responsible for overseeing and monitoring approximately 2,300 GDCs that are subject to Article 47 of Title 24 of the Rules of the City of New York, also known as the City Health Code.  During the period under review, DOHMH generally maintained adequate controls over its permit process to provide reasonable assurance that GDCs submitted all documents as required by law to DOHMH before being granted permits to operate.  However, the audit also found weaknesses in DOHMH’s permitting process that raised health and safety concerns.  Specifically, DOHMH did not ensure that all of the GDCs had tested the water at their facilities for lead as required by Article 47 of the City Health Code.  To carry out Article 47’s requirement that every GDC test its water for lead, DOHMH designed its Child Care Activity Tracking System (CCATS) to issue permits only to GDCs that had submitted proof that they tested the water in their facilities for lead.  Yet, the audit found that BCC management overrode its own requirement and instructed staff to enter into the CCATS database a statement that a report of a water lead test with acceptable results had been received in cases where no such test had been performed, or where there was no evidence that an acceptable result had been reported.
  • An audit was conducted to determine whether the New York City Housing Authority (NYCHA) had developed and implemented an emergency preparedness and recovery plan in the event of any service interruptions or natural disasters. The audit found significant deficiencies in NYCHA’s efforts to prepare for emergencies that increased the risk that NYCHA will not be able to handle emergency situations effectively and restore the agency to a normal level of operation in an expeditious manner.  NYCHA’s Emergency Procedures Manual did not properly define the emergency management leadership or adequately identify a distinct hierarchy of who would be in charge in the event of an emergency; did not have a communication plan that specified how critical information will be disseminated to NYCHA’s employees, residents, and other stakeholders; and did not incorporate an overall view of NYCHA’s capabilities and potential hazards during major emergencies, including identification of its resources, critical services and operations, and community groups that could potentially assist with the emergency response. The audit also found that to the extent that NYCHA’s Emergency Procedures Manual did set out procedures to follow in different types of emergencies, NYCHA had not complied with certain key provisions.  Further, NYCHA did not maintain accurate information on its tenants with disabilities in its Tenant Data System, and NYCHA’s Property Managers did not maintain complete lists of tenants with physical disabilities.  Finally, the audit found that NYCHA had poor controls over its inventory of generators.

Information Technology

All City agencies rely on information technology to help perform the tasks necessary to maintain mission-critical operations.  Over the past decade, the City has spent a significant amount of taxpayer dollars on information technology.  That being the case, I have continued to dedicate a portion of the bureaus’ resources to audits of system-development projects.  Many of these audits identified computer systems that were developed with excessive cost overruns and missed deadlines, or that simply did not meet agency needs.  Brief descriptions of two of these audits follow:

  • An audit assessed whether the General Corporation Tax (GCT) data administered by DOF exists in a secure environment and is readily accessible only to authorized users, is sufficiently reliable for collection purposes, and contains required information for the enforcement and penalty collection process. Among its many responsibilities, DOF administers the City’s GCT which accounted for $2.9 billion in revenue in Fiscal Year 2015.  During the audit scope period, tax information was sent daily to DOF electronically and uploaded into the agency’s Fairtax system (Fairtax), which was replaced by the Business Tax System in January 2016.  The audit found that GCT data generally existed in a secure environment with restricted access, and was readily accessible only to authorized users identified by DOF.  GCT data was also found to be generally reliable for collection purposes based on an examination of whether essential information for billing and collection purposes was missing from GCT.  The audit further determined that the data provided the necessary information for enforcement and penalty collection and that Fairtax made automatic corrections to accounts for taxpayers who selected an inappropriate option on their returns.

However, the audit also found a total of $195 million in outstanding GCT balances owed to the City.  This amount did not reflect accounts with pending decisions or transactions that when processed in batch may decrease the outstanding balances owed.  The audit identified several weaknesses in DOF’s tracking and collection processes that may have contributed to the creation of outstanding arrears.  The audit found that, on average, DOF forwarded 14 percent of the accounts in arrears to its Collections Unit each year.  It also found that Fairtax did not track accounts with outstanding balances in real-time, which may have resulted in delays in the collection of outstanding balances.  In addition, the audit found that the tax bills only reflected the taxpayer’s GCT liability for the current year and did not automatically reflect cumulative GCT tax liability.  Finally, the audit found several manual adjustments to tax return accounts in Fairtax that were not accompanied by reasons, descriptions, or proper approvals to justify the changes.

  • An audit was conducted to determine whether the NYCServ-Taxi application administered by the Office of Administrative Trials and Hearings (OATH) met the overall goals as stated in the system specifications, and had adequate functions to ensure the information process was reliable and secure from unauthorized access. In 2013, OATH implemented a new $1.5 million electronic file and case management application called NYCServ-Taxi.  Although the application was fully operational at the time of the audit, further periodic enhancements were planned, including an electronic interface with the Taxi and Limousine Commission’s computer environment.  As of the audit date, adjudicated and reviewed results were being manually entered into the systems by OATH’s data entry personnel.  The audit determined that the overall goals of the NYCServ-Taxi application as stated in the system specifications had generally been met.  In addition, the audit found that the application had adequate functions and controls to ensure that the information processed is reliable.  Further, the audit determined that the application, which is Intranet-based, has restricted internal access, and has been generally secured from unauthorized external access.  However, the audit also found that the NYCServ-Taxi application had internal security weaknesses that required additional system modifications and controls to remediate risks, including that Microsoft Windows password complexity had not been enabled, web server security updates were not current, there were application access control vulnerabilities, and Personally Identifiable Information was exposed.

As the City’s Chief Fiscal Officer, it is my duty to do everything in my power to maintain the City’s fiscal health.  The Audit Bureau uses its power of audit to find waste, mismanagement and inefficiency in City government, as well as to root out fraud and abuse, while championing improvements that can achieve more efficient, effective City operations and services.  The Bureau examines every corner of local government to improve services and save tax dollars wherever possible.  The Bureau makes hundreds of recommendations to improve City programs that can have a positive impact on service delivery if implemented.  The audits and investigations summarized in this annual report have been important in accomplishing our task of ensuring that government resources are not wasted, but put to work to improve the lives of all New Yorkers.

While agency managers are responsible for resolving and implementing recommendations promptly and effectively, the auditors follow up to see that action has been taken and intended results realized.  A review of the implementation of the 517 recommendations made in this year’s audit reports found that 32 City agencies and other related entities reported implementing or being in the process of implementing 434 recommendations (83.9 percent); they reported not implementing 83 recommendations (16.1 percent).  This is the highest level of compliance by audited entities in seven years, indicating that the City is greatly benefiting from our audit efforts.

The Comptroller’s Office welcomes your interest in ensuring that all recommendations made by the Audit Bureau be considered by City agencies.  The benefit from audit work is not in the recommendations made, but in their effective implementation.  Corrective action taken by management is essential to improving the effectiveness and efficiency of government operations.  To that end, we have provided supplementary information on the status of all our recommendations by both audit report and by agency.


Scott M. Stringer