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Audit Finds Strong Internal Financial Controls
and
Monitoring in Place at NFTA
Internal financial controls at the Niagara Frontier Transportation
Authority (NFTA) are generally strong but could be improved in some
areas, according to an audit released today by State Comptroller Alan
G. Hevesi.
“The strong internal financial controls that we found in place
at NFTA are an indication of the Authority’s commitment to spend
public money wisely and serve the people of western New York effectively,” Hevesi
said. “A further indication of this commitment is the fact that,
in the areas where we found some room for improvement, the NFTA reacted
positively and has acted to implement our recommendations.
“While we have been sharply critical of authorities around New
York State – many of which lack the financial controls that are
in place at NFTA – we have also maintained that some of the authorities
are effective and well-run,” Hevesi added.
Auditors found that NFTA’s internal financial controls help
to ensure that revenues are collected in a timely manner and that its
annual budget is prepared in the appropriate time frame, with budget
estimates compared to actual operating costs and revisions made as
necessary. Auditors also found the internal controls facilitate accurate
time and attendance records and timely notation of additions, deletions
and overtime in the payroll system. Auditors noted that NFTA officials
have put monitoring systems in place to judge the effectiveness of
internal control systems.
Auditors determined that the NFTA Board of Directors and management
effectively use communications tools to support internal financial
controls. For example, NFTA has written job descriptions for all employees,
a procurement manual, payment policies, and management information
systems policies and procedures. Auditors noted NFTA uses the intranet
to disseminate these and other materials to staff quickly and efficiently,
and that the NFTA web site provides information for vendors who wish
to do business with the Authority.
Auditors found the NFTA Board has a code of ethics, met monthly as
required with a majority of members present, and receives information
necessary to manage and monitor NFTA operations. However, auditors
also found that certain reports that are required to be provided to
the Governor, Comptroller and Legislature had not been submitted. NFTA
officials indicated they would take steps to address this matter.
Auditors reported NFTA’s systems for procurement and contracting
were good, but they also found that more than half of NFTA purchase
orders were for purchases of less than $1,000, even though these purchases
represented just 1.2% of the value of all NFTA purchases. To improve
efficiency and reduce the cost of processing purchase orders, auditors
suggested using procurement cards for these smaller purchases. NFTA
officials said that they were in fact implementing a procurement card
system.
The NFTA was created in 1967 to develop and improve rail, bus, marine
and air transportation services in Erie and Niagara Counties in western
New York. The Authority has a staff of 1,499 and had total expenditures
in 2003-2004 of $185.6 million.
In a written response to the audit, NFTA officials agreed with the
audit recommendations, and outlined plans and target dates for implementation.
The full response from NFTA is included in the audit.
A similar audit, also released today, examined internal financial
controls at the Thousand Islands Bridge Authority, which operates the
Thousand Island Bridge System in Alexandria Bay in northern New York
State.
Click here for a copy of the NFTA audit.
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Albany Phone: (518) 474-4015 Fax:(518)
473-8940
NYC Phone: (212) 681-4825 Fax:(212) 681-4468
Internet: http://www.osc.state.ny.us
E-Mail:press@osc.state.ny.us |
