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To provide independent audits to promote transparency, accountability, efficiency and effectiveness of City government for the citizens of Albuquerque.
Although the City no longer has a contract with B&Y, the lessons learned from this audit will benefit the City with future contract compliance. City departments also need to be educated about contractual compliance by vendors and ensuring that only appropriate charges are authorized and paid by the City. In addition, allegations by user departments involving potential vendor fraud should be researched immediately, and referred to the City’s Office of Inspector General.
B&Y overcharged the City a calculated $13,692 on the invoices for services during the 18-month audit period. Invoicing errors were difficult to detect because B&Y did not include all the required information and itemization on its invoices. In addition, B&Y did not consistently record all the information required by the New Mexico Department of Agriculture.
The recently appointed Clerk has an opportunity to improve the Clerk’s Office’s performance by revising the department’s policies and procedures to ensure all regulatory requirements will be met. Additionally, the updated policies and procedures will be available for succession planning, training and to ease through transitions when there is turnover in critical positions. The Clerk also should develop a directive to assist City departments in determining which types of records should be retained at the department level and which types of records should be maintained at the Records Center. The Clerk should then communicate the directive Citywide to ensure compliance with NMAC General Records Retention and Disposition Schedules, facilitate IPRA compliance, and reduce the volume of records submitted to the Clerk.
The citizens of Albuquerque have an opportunity to increase the City’s recycling revenue and reduce expenses by increasing the overall weight of recycled commodities, focusing recycling efforts on those commodities that have higher index pricing and reducing the amount of residual/contaminated materials placed in recycling bins. The City’s recycling program and contract with Friedman have been successful. Since 2011, more than 91,000 tons (over 182 million pounds) of recyclable materials have been diverted from the landfill and delivered to Friedman to be recycled. Without the recycling program of today, those materials would be taking up space in the landfill, increasing the City’s disposal costs, and increasing greenhouse gas emissions. By continuing to educate and increase participation in the recycling program, the City, through its contract with Friedman, may further reap the benefits of recycling such as saving energy and resources.
DTI should take additional steps to increase security on networked printer/copiers and other multifunction devices. DTI should also take steps to increase awareness of information technology security policies and specific risks posed by networked printer/copiers. Enhancements should be made to processes for departmental purchasing, leasing, and maintenance of printer/copiers. Going forward, printer/copiers should not be connected to the network unless accompanied by a DTI Service Now request. All devices on the network should be documented in a master list, which identifies any devices with hard drives. Procedures should be enhanced to ensure that hard drives on leased printer/copiers are properly erased before being sent back to the vendor or being replaced.
Numerous contract requirements were not met by B&D. As a result, the City was overcharged on some invoices, formal authorization to start work was not obtained by B&D, cost estimates were not provided prior to the performance of services, and subcontractors performed work on City facilities without City approval. B&D and the City should work together to increase compliance with contract terms.
Numerous contract requirements, which were not met by B&D, remained unnoticed by the City’s user departments. As a result, the City was overcharged on some invoices, cost estimates were not consistently obtained prior to the performance of services, subcontractors performed work on City facilities without City approval, important information was not provided consistently or maintained by user departments, and the City’s risk was not properly mitigated for large projects. Additionally, formal authorization to start work was not provided to B&D timely by City departments. DFAS-Purchasing and DMD should work together to provide information needed by City user departments to increase compliance with contract terms.
10-28-15 - 15-110 - Performance Audit - Citywide – Staffing Agency Vendor Contract Compliance - Select Staffing
Between FY 2010 and FY 2015, the City paid Select Staffing approximately $29.5 million to provide temporary staffing agency employees to help supplement the City’s workforce. As part of the contract, Select Staffing is required to comply with the terms that are detailed in the contract and RFB. However, based on the testing and review results of this audit there are several areas where Select Staffing is not following the contract and RFB terms. Select Staffing is not ensuring that the information on the invoices and periodic reports is always accurate, which has led to incorrect billing rates being listed. In addition, by not ensuring information on invoices and reports is accurate, Select Staffing hinders the City’s ability to perform proper reviews of the information. Select Staffing is also not ensuring that approved request forms are maintained for every staffing agency position filled at the City. By not maintaining these records Select Staffing could cause unapproved costs to be incurred, which may not be paid by the City when staffing agency employees are not properly approved before working. In addition, Select Staffing is not ensuring that the staffing agency employees they send to fill City positions have the proper qualifications for the job duties. This could potentially cause a liability for the City if staffing agency employees perform job duties they do not have the proper training for. Finally, Select Staffing is not pulling staffing agency employees from positions after they have been at the City for more than two consecutive years. This could cause a potential liability for the City if staffing agency employees, who have been used at the City for a continuous two-year period, feel that they are due permanent City employee benefits. It is imperative that Select Staffing ensure all contract and RFB terms are being complied with, and that all information sent to the City is accurate and complete.
10-28-15 - 15-110 - Performance Audit - Citywide – Staffing Agency Vendor Contract Compliance - Adecco
Between FY 2010 and FY 2015, the City paid Adecco approximately $23.3 million to provide temporary staffing agency employees to help supplement the City’s workforce. As part of the contract, Adecco is required to comply with the terms that are detailed in the contract and RFB. However, based on the testing and review results of this audit there are several areas where Adecco is not following the contract and RFB terms. Adecco is not ensuring that the information on the invoices and periodic reports is always accurate. This has led to incorrect costs on invoices, and estimated over billings of $38,540. In addition, by not ensuring information on invoices and reports is accurate, Adecco hinders the City’s ability to perform proper reviews of the information. Adecco is not ensuring that approved request forms are received each time the City needs to obtain a staffing agency employee. This is a requirement that staffing agency vendors must follow when supplying staffing agency employees. Without verifying that appropriate City personnel have approved the acquisition of these employees it could cause unapproved costs to be incurred, and may ultimately require Adecco to refund the City for the unapproved costs. Finally, Adecco is not pulling staffing agency employees from positions after they have been at the City for more than two consecutive years. Adecco is also not making sure that employees who have worked at the City in any capacity for more than two consecutive years take at least a 90-day break before placing them at the City again. This could cause a potential liability for the City if staffing agency employees, who have been used at the City for a continuous two-year period, feel that they are due permanent City employee benefits. It is imperative that Adecco ensure all contract and RFB terms are being complied with, and that all information sent to the City is accurate and complete.
10-28-15 - 14-104 - Performance Audit - Common Cash Bank Reconciliations - Department of Finance and Administrative Services
DFAS should dedicate the additional resources needed to accomplish accurate and timely reconciliations. Accurate and timely bank account reconciliations are essential internal controls to ensure that cash records are complete and accurate, and that data entry errors, bank errors, and potential fraud are detected and resolved in a timely manner. DFAS must first develop a complete understanding of the processes and activities that affect Common Cash. Once the department fully understands how various transactions affect Common Cash, it can implement business process improvements to resolve the complex account structure. Process improvements should also ensure general ledger data is sufficient to facilitate the matching of book transactions to bank statement activity. Gaining a full understanding of all cash transactions, revising business processes, completing the revised monthly book-to-bank Common Cash reconciliation, and resolving reconciling differences will enable DFAS to improve internal control over Common Cash, address the deficiencies noted by the external auditors, and eliminate CAFR audit finding 08-16.