Audit of the Payroll, Timekeeping, and Purchasing Operations of the Office of Administrative Trials and Hearings

Executive Summary

The Office of Administrative Trials and Hearings (OATH) is authorized under Chapter 45A, § 1048, of the New York City Charter to independently conduct administrative hearings for mayoral agencies, non-mayoral agencies, boards, and commissions of the City. OATH hears cases regarding disciplinary and disability matters; licensing and regulatory enforcement proceedings; real estate and land use issues; and contract and discrimination complaints.

During fiscal year 2000, OATH docketed 2,456 cases brought by 34 agencies. OATH’s budget for fiscal year 2000 was $1,370,866 for Personal Service (PS) expenditures, and $862,073 for Other Than Personal Service (OTPS) expenditures. OATH spent a total of $2,188,425 from the $2,232,939 budgeted—$1,369,897 on PS expenditures, and $818,528 on OTPS expenditures.

This audit determined whether OATH: complied with applicable City payroll and timekeeping procedures (i.e., Comptroller’s Directives #1, #13, and #14, and the City’s Payroll Management System guidelines); and complied with applicable City purchasing procedures (i.e., Comptroller’s Directives #3, #6, #24, and #25, and the Procurement Policy Board Rules).

We found that OATH complied with all applicable Comptroller’s Directives and PPB rules, as well as with the City’s Payroll Management System procedures and the City Charter. However, there were two minor weaknesses in OATH’s cash receipts and purchasing practices. OATH collects fees for copies of official case documents and copies of the OATH Rules of Practice and issues receipts for the fees collected. OATH retains a copy of all the receipts issued, but does not pre-number the receipts. Further, OATH does not maintain a log of the fees collected to ensure that all fees are deposited. In addition, seven of 20 sampled purchases were charged to incorrect object codes. The use of the correct object code is important because it allows an agency to categorize the type and amount of a particular expense item within a fiscal year. This information is used to generate the year-end reports that identify expenditure patterns.

To address these issues, we recommend: that OATH issue pre-numbered receipts when collecting fees for copies of documents and maintain a log of the fees collected; and that OATH follow the City Chart of Accounts to ensure that purchases are charged to correct object codes.

The matters covered in this report were discussed with OATH and DCAS officials during and at the conclusion of this audit. A preliminary draft report was sent to OATH and DCAS officials on April 23, 2002. On April 26, 2002, OATH and DCAS officials decided that an exit conference would not be necessary. On April 30, 2002, we submitted a draft report to OATH and DCAS with a request for comments. We received a written response from OATH on May 16, 2002. OATH officials agreed with the audit’s findings and recommendations. DCAS officials did not respond in writing to the draft report, but stated that they agreed with the audit’s findings and recommendations.