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NYS Comptroller

THOMAS P. DiNAPOLI

Audits of Local Governments and School Districts

City of Canandaigua – Procurement and Information Technology (2012M-62)


Released: June 29, 2012 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to assess the City of Canandaigua's internal controls over IT and procurement for the period January 1, 2010, to December 21, 2011.

Background

The City of Canandaigua is located in Ontario County and has a population of approximately 11,000. The City has a Mayor, an eight-member City Council (Council), and a Council-appointed City Manager. The City's 2011 budget totaled $22.3 million.

Key Findings

  • The City's procurement policy was not reviewed by the Council annually, as required by law, and was not adequate or up-to-date. City officials did not seek competition, such as using RFPs, when procuring nearly $165,841 in professional services from two vendors.
  • The Council did not adopt policies and procedures to address the proper use of the City's purchase order (PO) system, or the authorized and documented use of City credit and procurement cards. City employees regularly circumvented the purchasing policy by using confirming POs and by making purchases with credit or procurement cards.
  • Claims were not being audited in accordance with the City Charter.
  • The City's access rights are not deactivated in a timely manner, administrative rights of the City's financial software package were assigned to the Clerk/Treasurer with little oversight, inventory records for computer equipment are not kept or updated, and the City has no formal disaster recovery plan.

Key Recommendations

  • Review the purchasing policy to ensure it continues to meet the City's needs and comply with applicable laws, update it to include procedures for procuring professional services and the amended GML competitive bidding thresholds and ensure that it reviews and approves the policy annually.
  • Establish procedures to provide detailed formal guidance to City personnel on the routine and proper use of POs, including when the use of confirming POs is permitted.
  • Ensure that the Manager is properly auditing claims per the City Charter.
  • Develop written policies and procedures addressing user access controls, designate an employee outside of the Clerk/Treasurer's office as the system administrator, develop and adopt a formal disaster recovery plan, and implement formal inventory control procedures designed to properly account for electronic equipment.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email: localgov@osc.state.ny.us
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236