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July 22, 2010

Comptroller DiNapoli Releases Audits

New York State Comptroller Thomas P. DiNapoli announced today the following audits have been issued:

Department of Taxation and Finance, Contracts for Personal and Miscellaneous Services (2009-S-38)
During the three-year audit period, the Department of Taxation and Finance had 81 contracts for personal and miscellaneous services totaling about $563 million. More than 98 percent of this amount related to contracts for either information technology or banking services. Auditors examined whether the department was adequately justifying the need to initially contract out for such services and periodically reassessing whether such contracts could be deferred, eliminated or reduced to save state funds. They found that the department was sometimes but not always performing these activities.

Workers’ Compensation Board, Costs To Administer the Workers’ Compensation Program (2009-S-45)
The primary responsibility of the Workers’ Compensation Board is to ensure that workers who are off the job because of injury or illness are compensated under programs covering both occupational and non-occupational disability and sickness. In accordance with state law, the Board's costs for administering these programs are paid by assessments levied on insurance carriers and self-insured businesses and political subdivisions. According to the Board’s consolidated statement of costs for the fiscal years ended March 31, 2007 and March 31, 2008, the assessable costs for these two years totaled $178,050,004 and $190,452,900, respectively. Auditors examined the financial statements for these two years and concluded that they were presented fairly in all material respects.

Office of Temporary and Disability Assistance, Minority and Women’s Business Enterprise Reporting (2009-S-106)
State agencies and public authorities are required to promote the participation of minority-owned business enterprises (MBEs) and women-owned business enterprises (WBEs) in state contracts and procurement opportunities. Specifically, agencies must establish annual goals for such participation (expressed as a percentage of the agency’s total contract spending for the year), make a “good faith” effort to achieve these goals, and report quarterly on their level of participation. Auditors examined the Office of Temporary and Disability Assistance’s (OTDA’s) performance in these areas and found that it had not established supportable goals and was not making a good faith effort to achieve these goals.

New York Power Authority, Controls Over Overtime (2009-S-110)
Auditors examined NYPA’s use of overtime at its facilities, focusing on the two facilities where overtime costs were highest (the Niagara Power Project and the St. Lawrence-Franklin D. Roosevelt Power Project). They determined that the overtime hours worked were necessary to maintain minimum staffing levels and to repair operating systems. However, they found that overtime costs could have been reduced if each plant’s operations department had been adequately staffed. They also found that controls were adequate to ensure that employees were present during scheduled and overtime shifts, performing assigned duties, and recording time accurately on their timesheets.

Department of Taxation and Finance, Wireless Security Controls (2010-S-8)
Auditors examined whether unauthorized wireless access points were present on the department’s network providing access to sensitive data. Auditors did not locate any such points during testing, but found that the department was not performing any testing to identify such points. They recommended the department perform periodic, random testing to ensure that unauthorized wireless access points were, in fact, not present.

Office of General Services, Interagency Consolidation of Administrative and Support Services (2009-S-31)
Auditors examined OGS’s performance regarding hosting services provided for a group of agencies and found that, on balance, they appeared to be effective.  Auditors also found that there were clear efficiencies in the consolidation of these administrative and support services at OGS. Auditors conservatively estimated that New York State was saving a net total of at least $716,900 a year through the hosting arrangements.

State Government Accountability
The Office of the State Comptroller regularly audits state agencies, public authorities and New York City agencies. Auditors ensure that programs achieve their established goals, funds are used efficiently and assets are adequately protected against fraud, waste and abuse. DiNapoli’s office completes approximately 200 state audits and annually identifies hundreds of millions in savings and fraud each year.


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