Audit Report on the Financial and Operating Practices of the Staten Island Borough President’s Office

AUDIT REPORT IN BRIEF

We performed an audit of the compliance of the Staten Island Borough President’s Office with certain payroll, timekeeping, purchasing, and inventory procedures, as set forth in the Office of Payroll Administration policies and procedures, the Procurement Policy Board (PPB) Rules, and the New York City Comptroller’s Internal Control and Accountability Directives (Comptroller’s Directives). During Fiscal Year 2002, the Personal Service (PS) expenditures for the Staten Island Borough President’s Office (Borough President’s Office) amounted to $3,436,492; Other Than Personal Services (OTPS) expenditures amounted to $1,351,311.

The Borough President’s Office generally adhered to Comptroller’s Directives, Procurement Policy Board Rules, and Office of Payroll Administration policies and procedures with respect to payroll, timekeeping, purchasing, and inventory management. Our examination of the PS and OTPS expenditures disclosed no instances in which monies were improperly used. Moreover, we found that the Borough President’s Office:

• ensured that employees’ annual leave balances did not exceed the two-year accrual limit;
• purchased items that were necessary for its operations;
• properly completed vouchers and purchase orders and accurately calculated the amounts paid to vendors;
• complied with Comptroller’s Directive #3. In that regard, Imprest Fund purchases did not exceed $250; invoices to support Imprest Fund payments were maintained; checks had the required authorized signatures and designated specified payees; and each check bore the inscription " void after 90 days."
• accurately reconciled the Imprest Fund bank account;
• ensured that all employees sampled are bona fide;
• ensured that employees signed the required Form 319 when picking up their paychecks;
• accurately calculated and properly authorized all pay increases;
• accurately paid employees upon separation from City service; and
• maintained up-to-date and accurate inventory lists and affixed identification tags to the sampled inventory items.

However, the audit found instances in which the Office did not comply with certain provisions of Comptroller’s Directive #23 and #24, the City’s Time and Leave Regulations, PPB Rules, and Payroll Management System (PMS) guidelines. Specifically, the Borough President’s Office:

• did not always accurately charge employees’ leave balances for annual and sick leave use;
• permitted employees to carry compensatory time beyond the 120 day limit;
• did not place on sick leave restriction employees who had more than five undocumented sick leave instances within a "sick leave period," as required by the Time and Leave Regulations;
• paid employees in excess of their Career and Salary Plan title salary ranges;
• did not ensure that the preparation and review of its "employee update" and "job appointment" forms were performed by different individuals;
• did not ensure that each page of the voucher packages sampled were stamped "vouchered" as required by Directive #24;
• did not ensure that the purchase requisition forms had the required signatures approving the purchases; and,
• did not ensure that its employees disclosed in writing to the Conflicts of Interest Board their positions with not-for-profit organizations that received discretionary grants from the Borough President’s Office.

Moreover, the Office did not maintain copies of the insurance certificates required under agreements with vendors and recipients of discretionary grants.

To address these issues, the audit made 13 recommendations, including that the Borough President’s Office should:

• Ensure that timekeeping transactions are carefully reviewed so that timekeeping errors are avoided.
• Require employees to use compensatory time within 120 days after it is earned. If an employee does not adhere to this requirement, the compensatory time should be converted and incorporated into the employee’s sick leave balance.
• Transfer employees whose salaries currently exceed their title limits into other titles that they qualify for and that have salary ranges that properly encompass their current pay levels.
• Implement a tracking system to ensure that grantees and vendors provide up-to-date insurance certificates that cover the entire contract period.
• Ensure that the Borough President and the Confidential Assistant to the Borough President formally disclose in writing to the COIB their positions with not-for-profits, and consult with the COIB where appropriate.