Audit Report on The Other Than Personal Services Expenditure Practices of The New York City Campaign Finance Board

Executive Summary

The objective of this audit was to determine whether the New York City (City) Campaign Finance Board (CFB) has adequate controls over its Other Than Personal Services (OTPS) expenditures pertaining to its imprest fund^[1] and miscellaneous payment voucher use, purchasing card (p-card) purchases,^[2] purchasing of computers and computer-related items, and campaign finance payments.

The CFB was established in 1988 as an independent, nonpartisan agency to administer the City’s campaign finance system, and is charged with providing public matching funds correlated to the dollar values of small contributions made to candidates running for City office as part of an effort to limit the role and influence of private money in the political process. By increasing the value of small-dollar contributions, the program’s intent is to reduce the possibility for and perception of corruption from large contributions and unlimited campaign spending.

A prior NYC Comptroller’s Office audit, “Audit Report on the Other Than Personal Service Expenditures of the New York City Campaign Finance Board” (Audit #FL11-069A; issued July 8, 2011), found that the CFB generally adhered to the requirements of Comptroller’s Directives #6 and #24, the Department of Investigation’s (DOI’s) inventory standards, and applicable Procurement Policy Board (PPB) Rules. However, the audit identified several instances of the CFB’s noncompliance with aspects of these requirements.

During Fiscal Year 2019, the CFB’s Other Than Personal Services (OTPS) expenditures totaled $15.3 million, consisting of $6.3 million for its general OTPS expenditures, and $9 million in election funding.

Audit Findings and Conclusion

The audit found that the CFB generally had adequate controls over its OTPS expenditures pertaining to its imprest fund and miscellaneous payment voucher use, p-card purchases, purchasing of computers and computer-related items, and campaign finance payments. We found that payments for sampled purchases and employee reimbursements were generally supported and that the required approvals were obtained before the sampled campaign finance payments were processed. However, we found that several areas of the CFB’s operations relating to OTPS expenditures need improvement. Specifically, we found that some purchases and reimbursement payments lacked evidence of requisite approvals. We also found that the CFB did not consistently follow Comptroller’s Directive #6 and the CFB’s written policies and procedures concerning City-funded payments for employees’ transportation and attendance at training conferences, including requirements for long-distance travel and taxi fare reimbursement. In addition, we found that the CFB did not charge some payments to the correct object codes and incorrectly used miscellaneous payment vouchers.

Although the CFB has written policies and procedures for a number of its purchasing activities, they were not always detailed or regularly updated, which may have contributed to the deficiencies we identified.

Audit Recommendations

Based on the audit, we make 13 recommendations, including the following:

• The CFB should ensure that requisite written approvals are obtained before purchases are processed.
• The CFB should ensure that all travel-related expenditures (local and long-distance travel requests) include written justifications as set forth in Comptroller’s Directive #6.
• The CFB should ensure that local and long-distance travel expenses paid by the agency meet the conditions established in the CFB’s procedures and Comptroller’s Directive #6.
• The CFB should ensure that OTPS payments are recorded under the correct object codes.
• The CFB should review and follow policies set forth by Directive #24 and ensure to only use miscellaneous payment vouchers for allowable purposes.
• The CFB should update its written policies and procedures to include greater detail and specific requirements to address the deficiencies identified in this report.

Agency Response

In its response, the CFB agreed with the audit’s 13 recommendations.

[1] “Imprest Funds are agency-controlled checking accounts that can be used for small purchases and petty cash transactions.” Comptroller’s Directive #3: Administration of Imprest Funds.

[2] According to the Mayor’s Office of Contract Services, “The Purchasing Card (P-Card) program is designed to assist agencies in streamlining the process for certain micropurchases [defined as purchases of goods and services other than construction valued at $20,000 or less by Procurement Policy Board Rules §3-08]. P-Cards are used by agencies to purchase goods and standard services quickly and efficiently, without the intermediate steps required by the City’s financial management system.” NYC Mayor’s Office of Contracting Services, P-Card Purchasing, https://www1.nyc.gov/site/mocs/reporting/citywide-indicators/p-card-purchasing.page (accessed April 28, 2021).