HomeMy WebLinkAboutCAO-09-016 - Kitchener Market Audit - Administrative Review
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KITCHENER
Chief Administrator's
Office
Report To:
Mayor Carl Zehr, Chair
and members of the Audit Committee
April 6, 2009
Date of Meeti ng :
Submitted By:
Prepared By:
Loretta Alonzo, Performance Measurement and Internal
Auditor
Loretta Alonzo, Performance Measurement and Internal
Auditor
All
Ward(s) Involved:
Date of Report:
Report No.:
Subject:
March 20,2009
CAO-09-016
Kitchener Market - Administrative Review
RECOMMENDATION:
That the Audit Committee receives report CAO-09-016 as information.
EXECUTIVE SUMMARY:
At the request of the Director of Business Development, Economic Development, the internal
audit division conducted a review of the administrative functions at Your Kitchener Market which
was completed in December 2007.
Opportunities for improvement were identified and the following objectives for the review were
established:
· Analyze the cash handling, rent collection and deposit processes, identify control
weaknesses and recommend improvements to reduce risk and increase efficiency
· Review general administrative functions to improve efficiency
· Analyze financial reporting to determine if revenue recognition is accurate
· Analyze accounts receivable records to determine if balances reported through the Class
system are accurate
A total of thirty-six recommendations were made by the Auditor, most relating to administrative
efficiencies and improved financial reporting.
The Director took immediate corrective action and all of the Auditor's recommendations have been
fully implemented over the past three months.
REPORT:
The Director of Business Development, Economic Development assumed the management of
the Market on an interim basis and identified a number of areas for improvement. Areas of
primary concern were the administrative practices and control procedures for cash handling,
rent collections from vendors and the tracking and reporting of accounts receivable.
The scope of the audit was limited to the following:
· Analysis of rent collection process and documentation
· Identify control weaknesses and risks in terms of cash handling and deposit procedures
· Evaluate accuracy of the accounts receivable system (Class)
· Analysis of revenue recognition through the financial reporting process
· General review of the administrative processes in the Market office
The following research and analysis was undertaken for this review:
· Interviews with eight market vendors
· Interviews with four staff members and the Director
· Attendance at Saturday market to observe rent collection, cash handling, deposit
documentation and accounts receivable tracking
· Meetings with Program Assistant to review accounts receivable documentation
· Review of all existing vendor contracts/leases
· Meeting with financial analyst and accounting analyst responsible for Market's financial
reporting and the Class system
· Review of financial statements for the Market
· Complete reconstruction of 2008 accounts receivable transactions, by vendor, by month to
determine accurate revenue and rent amounts owing by vendors
· Controls testing of receipts, deposits and collection documentation to determine if any fraud
or theft has occurred
The Auditor confirms that no serious deficiencies or non-conformities were identified in the
course of this review.
A total of thirty-six recommendations for improved efficiency were presented to the Director and
over the past three months, all corrective actions have been completed.
FINANCIAL IMPLICATIONS:
None
COMMUNICATIONS:
N/A
Signed and reviewed by
Loretta Alonzo
Performance Measurement and Internal Auditor