01-08-2016 - 15-505 - Vendor Audit - B & Y Pest Control, Inc. – City Report
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The Office of Internal Audit (OIA) conducted a citywide vendor audit of B&Y Pest Control, Inc. (B&Y). Vendor audits are included in OIA’s fiscal year (FY) 2015 audit plan and the City’s Department of Finance & Administrative Services (DFAS) requested that B&Y be considered for an audit. In the midst of the audit, B&Y’s contract with the City of Albuquerque (City) expired and DFAS did not renew the contract. As the audit was already underway and the City had received multiple complaints from various City departments pertaining to B&Y’s services and billings, OIA continued and completed the audit. Some of the departments’ complaints against B&Y involved inaccurate billings, unperformed services, and falsified records. The City paid B&Y more than $105,000 for pest control services during the 18-month audit period. B&Y overbilled the City $13,692 during that period.
The audit found that:
- B&Y Pest Control billed the City inaccurately on multiple instances;
- City departments had not verified the accuracy of invoices or required proof of service prior to approving invoices for payment; and
- DFAS – Purchasing had not investigated departments’ complaints regarding B&Y Pest Control timely.
The CAO should:
- Instruct DFAS to issue an invoice to B&Y for the $13,692 overpayment; and
- Emphasize to City departments the importance of reviewing invoices for accuracy and obtaining proof of service prior to approving payment.
- Investigate departments’ complaints timely and refer allegations of vendor fraud to the Office of Inspector General
The CAO and DFAS agree with the findings and acknowledge the importance of reviewing invoices for accuracy and ensuring proof of service exists prior to authorizing payments.