The County of Santa Clara
California

Report
77975

Consider recommendations from Finance Agency, Controller-Treasurer Department's Internal Audit Division relating to the audits of Supervisorial District 2 (former Supervisor George Shirakawa).

Information

Department:Finance AgencySponsors:
Category:Report

Multiple Recommendations

Possible action:
a. Receive report relating to the Follow-up Audit to the Internal Audit of Object 2 (Non-Personnel Services and Supplies) Expenditures of District 2 (former Supervisor George Shirakawa) for the period of January 2009 through September 2012.
b. Receive report relating to the Follow-up Audit to the Controller-Treasurer's Report of Procurement Card (P-Card) Transactions of District 2 (former Supervisor George Shirakawa) for January 2009 through September 2012.

Body

FISCAL IMPLICATIONS

There are no direct fiscal implications associated with accepting these reports.

REASONS FOR RECOMMENDATION

The Internal Audit Division submits audit reports to the Finance and Government Operations Committee for its review.  The Internal Audit Division has completed two audit reports

A Follow-up Audit to the Internal Audit Report Audit of Object 2 (Non-personnel Services and Supplies) Expenditures of District 2 from January 2009 through September 2012.

A Follow-up Audit to the Controller-Treasurer’s Report: Audit of Procurement Card (P-Card) Transactions of Supervisor George Shirakawa (District 2) for January 2009 through September 2012.

At the August 13, 2015 meeting, the Finance and Government Operations Committee (FGOC) requested an explanation regarding the disposition of two electric bikes purchased by District 2 that were given to the Office of the Sheriff. At the meeting, the Controller-Treasurer could not provide sufficient information to answer concerns of the FGOC. After the meeting, the Controller-Treasurer discovered that the Office of the Sheriff thoroughly reviewed the circumstances surrounding the use and disposition of the bikes and communicated this information to Internal Audit Division staff back in 2013. In this communication, the Office of the Sheriff indicated that its staff were under the belief that the bikes were given to the Office of the Sheriff in 2009 on a trial basis and did not know that District 2 purchased them. After using the bikes for a few months, they were deemed unsuitable for law enforcement purposes. The vendor who provided the bikes was notified of this determination and was requested to pick up the bikes, which was done by the vendor. A refund of the purchase price was not attempted by the Office of the Sheriff as its staff was under the impression that the bikes were lent to it on a trial basis and were not purchased.

In an attempt to jump start the refund process, Controller-Treasurer staff attempted to make contact with the vendor. However, staff discovered that the vendor ceased operations in 2012 per Board of Equalization records. A call to the landlord who rented space to the vendor in Sausalito, California revealed no forwarding mail address or contact information. A search for the owner of the business revealed a possible location in Mill Valley, California, but no physical or email address or phone number for the owner could be found. Therefore, there appears to be little chance of recouping the purchase price at this time, but Controller-Treasurer staff will continue to monitor social media websites to discover contact information for the owner.

CHILD IMPACT

The recommended actions will have no/neutral impact on children and youth.

SENIOR IMPACT

The recommended actions will have no/neutral impact on seniors.

SUSTAINABILITY IMPLICATIONS

The recommended actions will have no/neutral sustainability implications.

BACKGROUND

Per the Internal Audit Division Annual Work Plan, as approved by the Board, the Internal Audit Division completed two audits: first, A Follow-up Audit to the Internal Audit Report Audit of Object 2 (Non-personnel Services and Supplies) Expenditures of District 2 from January 2009 through September 2012 and second,  A Follow-up Audit to the Controller-Treasurer’s Report Audit of Procurement Card (P-Card) Transactions of Supervisor George Shirakawa (District 2) for January 2009 through September 2012.  During a follow-up audit, IAD evaluates the progress made on recommendations.  The IAD does not change the initial findings, recommendations, or priority levels assigned.

For the first audit, there were seven recommendations.  Four were implemented and three are no longer applicable. For the second audit, there were 12 recommendations. Eight were implemented and four are no longer applicable. Please note that on April 24, 2015, the Office of the County Counsel filed a lawsuit to collect the remaining $4,425 owed to the County on recommendations from the two audits.  Since the Office of the County Counsel will be pursuing these lawsuits, no additional follow-up by the Internal Audit Division is needed.

CONSEQUENCES OF NEGATIVE ACTION

The Committee will not have the information provided herein.

Meeting History

Sep 10, 2015 1:00 PM Video Finance and Government Operations Committee Regular Meeting

Added to consent at request of Chairperson Simitian.

RESULT:RECEIVED