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Internal Audit

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The Office of Procurement (Procurement) and the Department of Finance (Finance) are responsible for the oversight of activities within the Procure to Pay function that are performed by each department within Montgomery County (the County). As such, their role is critical to ensuring that the departments adhere to the policies and requirements related to the use of public funds. >> View the report

 

About Internal Audit Program

This program provides independent strategic risk-based auditing services.  The core function of this program is to improve internal controls and provide reasonable assurance of reliable financial reporting, effective and efficient operations, legal and regulatory compliance, fraud investigation and deterrence, and the safeguarding of County assets.  

 


Below are the list of reports available since September 2009.
Search the reports by entering keyword, or sort the table by clicking the column heads.

Date Title Department Description
09/22/2009 DPS Commercial Building Permit Calculation Process Review DPS This report summarizes the work performed by MCIA in reviewing the Montgomery County Department of Permitting Services procedures for calculating Commercial Building Permit Fees. It sets out the individuals interviewed, documents reviewed, the results of CBH recalculation of permit fees, and recommendations to the Department of Permitting Services (DPS). 
04/20/2010 Wage Requirements Law PROC Montgomery County's Office of Internal Audit (MCIA) conducted an agreed-upon procedures audit to aid the County in determining compliance with the Wage Requirement Law under several contacts.  This report summarizes the results of that review.
05/12/2010 County-Wide Risk Assessment and Multi-Year Audit Plan CAO This document summarizes the work performed in conducting a County-wide risk assessment of the Montgomery County executive branch departments. The scope of this engagement included all departments of the executive branch and the Capital Improvements Program (CIP) as it relates to executive branch departments. This document sets out details of the approach, methodology and matters considered in assessing areas of risk within Montgomery County and the internal audits to be considered as part of the proposed three-year internal audit plan. 
06/03/2010 OHR Tuition Assistance Program OHR This report summarizes the work performed by MCIA in reviewing the Montgomery County Tuition Assistance Program (TAP) policies and practices. TAP provides Montgomery County employees monetary assistance for various educational courses, seminars, training sessions, etc.  The primary objective of the TAP review was to determine the effectiveness of the program's existing internal controls including necessary changes to assure compliance with applicable laws, regulations, policies and procedures; and prevent waste, fraud and abuse. We are making 16 recommendations to improve internal control over TAP and to strengthen needed monitoring and oversight.
02/17/2011 Police Overtime POL The Montgomery County Police Department (MCPD) is
consistently one of the top overtime users within
Montgomery County and overtime expense is a significant operating expense. Inherently, MCPD is subject toconsiderable overtime hours due to the department's need tooperate 24 hours a day, 7 days a
week. Overtime makes up about 4% or almost $10 million of MCPD's total operating budget of$246.3 million. While the County and MCPD have instituted recent actions to better monitor overtime use, the average overtime expense per employee has remained
consistent over the last five years. In a recent Countywide risk assessment, MCIA had designated
overtime as a high-risk area. 
05/06/2011 HHS Contract Monitoring HHS Montgomery County Department of Health and Human Services (HHS) manages over 660 contracts with total encumbrances of over $97 million in FY 2010. This represents about 13% of all County procurement funds.  Since HHS relies on these contractors to provide a significant portion of the County's HHS Services, accountability over contracts is critical. This report assesses whether the internal control by HHS over the monitoring of cost reimbursement contracts is operating effectively and whether the Department has successfully implemented control changes it made between FY 2009 and FY 2010. We reviewed a sample of contracts from fiscal years 2009 and 2010 in each of the six main HHS Service Areas to determine whether contracts were monitored financially and operationally in accordance with HHS policies and whether such policies need further upgrading. MCIA makes 15 recommendations to improve internal controls at HHS, in such areas as the treatment of indirect cost rates, development of a comprehensive review policy, file documentation, and training. 
06/30/2011 DLC Point of Sale System DLC At a cost of over $1.7 million, the Montgomery County Department of Liquor Control (DLC) implemented the Microsoft Retail Management System (RMS) in 2010 for the purpose of improving the accuracy, timeliness, control, and customer service aspects of Point-of-Sale (POS) processing of customer transactions.  The new system is integrated at all 24 DLC stores, the Montgomery County Department of Technology Services (DTS) and with two third party providers.  This was a major implementation of hardware and software which replaced an antiquated, unsupported system that had been in place at the DLC since the 1990s.  The DLC employs over 300 County employees and processes over $225 million in annual sales.  MCIA is making 15 recommendations to improve the internal control environment at the DLC in such areas as project management, IT training, problem tracking, polices & procedures, security administration, inventory tracking, data restoration and disaster recovery. 
09/14/2011 DOT & DGS CIP Invoice Controls DOT
DGS
The Montgomery County FY11-16 Capital Improvements Program (CIP) includes over $4 billion in capital projects. County government departments are allocated $2.1 billion or 52.8% of the program The Department of Transportation (MCDOT) and Department of General Services (DGS) have oversight and administrative responsibilities for approximately $ 1.8 billion or 86% of the county government allocation. The majority of the expenditures under the program are incurred under contracts executed for project design and construction.  Both the CIP and contracting were identified as areas of higher risk in the County-wide risk assessment completed by MCIA.  We reviewed the policies and procedures for invoice review and approval for CIP projects undertaken by MCDOT and DGS. MCIA is making seven recommendations to improve the performance and enhance the existing internal controls pertaining to invoice approval and payment. 
10/16/2011 DOT Revenue Processing and Imprest Reconciliation DOT
FIN
In FY 2011 the Montgomery County Department of Transportation (MCDOT) Revenue Processing Center has processed and deposited approximately $23 million related to parking meter, parking machine and Ride On Bus revenue.  This audit was performed in response to claims of possible weaknesses in controls over the storing and counting of cash collections at the Center. Parking district revenue services was identified as an area of moderate risk in the County-wide risk assessment completed by MCIA in FY2010. In addition the management letter associated with the external financial statement audit of Montgomery County for FY2010 indicated that controls over Imprest Funds could be strengthened. MCIA is making nine recommendations to MCDOT and the Department of Finance to improve the security, operation, and reconciliation policies and procedures for MCDOT activity at the Revenue Processing Center.  
02/27/2012 Finance Purchase Card Program FIN The County Government's Purchase Card Program is designed to be a fast and flexible purchasing tool that provides an efficient and effective method for purchasing small dollar items. The cards are similar to personal credit cards except that the County pays the charges. The Purchase Card Program includes over 500 cardholders from 43 County departments. The County has procured over $9 million and $10 million of goods and services using purchase cards in FY 2010 and FY 2011, respectively. The Department of Finance is responsible for oversight and administration of this program. We reviewed policies and procedures related to Purchase Card Program activities. MCIA is making seven recommendations to improve internal controls for adequate support, proper approval, and effective oversight of transactions in the Purchase Card Program. 
06/01/2012 Correctional Officer Salary Schedule OHR
DOCR
In July 2007, The Montgomery County Department of Corrections and Rehabilitation (DOCR) transitioned to a new Correctional Officer Salary Schedule. Through subsequent review, it was determined that multiple Correctional Officers were incorrectly converted to the new salary schedule, which ultimately resulted in incorrect pay. In December 2008, the Office of Human Resources (OHR) performed a review of the Correctional Officers converted when DOCR management had concerns that some of the officers were incorrectly converted. OHR concluded, based upon its review, that 130 officers were incorrectly converted and proceeded to recoup overpayments from those employees or true-up underpayment to those employees. The Municipal and County Government Employees Organization (MCGEO) Labor Union expressed concern regarding the correction process. Both MCGEO and OHR agreed to have an independent third party (MCIA) review the conversion to determine if all officers were properly converted and/or corrected. This report is a reissuance of a report we issued in November 2011 MCIA recommends OHR correct the salaries of the 7 officers that we found to still be in error. We also offer several recommendations aimed at improving the planning for and implementation of any future complex County initiatives to avoid the types of problems the County experienced with the conversion of Correctional Officer's pay. 
07/30/2012 Pension Benefit Payments (Employees' Retirement System) OHR
MCERP
The County Government has three employee retirement plans: the Employees' Retirement System (ERS), the Retirement Savings Plan (RSP) and the Deferred Compensation Plan (DCP). This audit focused on the ERS plan, which is the largest of the three with 5,516 active participants and 5,712 retirees and beneficiaries receiving benefits as of June 30, 20111. ERS ended fiscal year 2011 with $2.8 billion in net assets and paid out $178.7 million in retirement benefits during the year2. The Office of Human Resources (OHR) was responsible for administering the retirement benefit plans from enrolling plan participants, counseling potential retirees, determining eligibility for retirement, calculating retiree benefit payments, and maintaining retiree records. As of July 1, 2012, the Montgomery County Employee Retirement Plans (MCERP) organization has oversight of the activities previously performed by OHR except for employee enrollment in retirement plans. MCIA is making five recommendations. One recommendation addresses the need to research and correct payment errors we found. The other four are aimed at to improving existing internal controls, including implementing of procedures to review Cost of Living Adjustments (COLA), reinforcing the use of checklist by benefit specialists, developing a documentation archival plan and formalizing procedures for notifying retirees of payment changes.
11/16/2012 DPS Receipts and Financial Instruments Process Controls DPS We conducted a limited scope, independent review of the Department of Permitting Services (DPS) with the objective of reviewing the adequacy of controls over receipts associated with the permitting process and the safeguarding of various bonds and letters of credit that are received in connection with permits. The review was initiated because of concerns expressed by the Director, DPS upon assuming responsibility for the Department, including weaknesses in control and safeguarding of assets. MCIA is making five recommendations. One addresses the need to establish a Cashiering Function to serve as a focal point for intake, receipting and securing all receipts. The remaining recommendations address strengthening the reconciliation process, increasing efficiency through the implementation of a check scanning process, and enhancing the safeguarding of financial instruments stored in the Department. 
11/28/2012 DEP Contract and Grant Monitoring  DEP The contract and grant monitoring audit of the Department of Environmental Protection (DEP) is the first in a series of five department audits to focus on the $470 million of grant and contract spending unrelated to CIP and HHS. DEP FY12 purchase order spending under contracts was $91 million or 19% of the $470 million, which is the second highest department in Montgomery County overall.  MCIA is making three recommendations to DEP in order to improve the performance and enhance the existing internal controls pertaining to contract monitoring. 
04/11/2013 Radios, Laptops, & Consulting Contracts Purchased Under the PSSM Capital Project DTS
MCPD
The Public Safety System Modernization Capital Project (PSSM), which has a current cost estimate of $108 million, has procured $22.7 million in radios and laptops for Police and Fire and Rescue departments.  Currently the project team is in the process of issuing procurement solicitations for the design and installation of the public safety first response systems such as Computer Aided Dispatch (CAD), Law Enforcement Records Management (LE RMS) and Voice Radio System are being issued. The Department of Technology Services created the PSSM Program Office to manage the implementation of the capital project. We performed this review of the PSSM Program Office contract administration and monitoring and assets safeguarding procedures for radios and other items as part of our continuous review of contracting by County Departments. MCIA is making two recommendations; one to the Department of Technology Services (DTS) and the second, a joint recommendation, to the Police Department (MCPD) and DTS to improve the safeguarding of radios purchased as part of the PSSM project. 
06/05/2013 Contract and Grant Monitoring by MCFRS  FRS The contract and grant monitoring audit of the Montgomery County Fire and Rescue Services (MCFRS) is part of a series of five department audits to focus on the $470 million of grant and contract spending unrelated to CIP and HHS. MCFRS FY12 purchase order spending under contracts was $5.6 million or 1.19% of the $470 million, which is the eighth highest department in Montgomery County overall.  MCIA is making four recommendations to MCFRS in order to improve the performance and enhance the existing internal controls pertaining to contract monitoring. 
06/20/2013 Post-Implementation Audit of Montgomery County's ERP ERP, CEX We conducted the audit as the County's Enterprise Resource Planning System (ERP) implementation project was identified as a high-risk area during our County-wide risk assessment. The ERP is an integrated system heavily relied upon by all County departments for their financial and operational processes. It is budgeted to cost over $65 million. The objectives of the audit were to review the effectiveness of the implementation effort, assess the adequacy of the key controls implemented for a select number of financial modules, and identify remaining challenges or problems in the implementation and potential solutions. We also reviewed the adequacy of controls to ensure payments to ERP contractors were correct. The audit focused on the design of controls and included limited sampling for testing. The audit sought to verify and confirm if appropriate internal controls are implemented within the system to identify, detect, and prevent errors and/or fraud. This report contains 14 recommendations including, defining adequate roles and responsibilities for business units, core departments, and the ERP Enterprise Service Center team; conducting business process reengineering of its operations including considering centralizing certain financial functions; hiring more skilled and technical full time resources; making reports available through ERP; developing strong user access administration process and conducting thorough segregation of duties analysis; and applying required configurations within the system.  
06/25/2013 Contract and Grant Monitoring by DGS DGS The contract and grant monitoring audit of the Department of General Services (DGS) is one in a series of five department audits to focus on the $470 million of grant and contract spending unrelated to CIP and HHS. DGS FY12 purchase order spending under contracts was $70.5 million or 15% of the $470 million, which is the second highest department in Montgomery County overall.  MCIA is making four recommendations to DGS in order to improve the performance and enhance the existing internal controls pertaining to contract monitoring and invoice review. 
07/08/2013 Contract and Grant Monitoring by MCPD MCPD The contract and grant monitoring audit of the Montgomery County Police Department (MCPD) is one in a series of five departmental audits to focus on the $470 million of grant and contract spending unrelated to CIP and HHS. MCPD FY12 purchase order spending under contracts was $18.46 million or 3.93% of the $470 million, which is the sixth highest department in Montgomery County overall.  MCIA is making four recommendations to MCPD in order to improve the performance and enhance the existing internal controls pertaining to contract monitoring. 
07/16/2013 Contract and Grant Monitoring by DOT  DOT The contract and grant monitoring audit of the Department of Transportation (MCDOT) is the third in a series of five department audits to focus on the $470 million of grant and contract spending unrelated to CIP and HHS. MCDOT FY12 purchase order spending under contracts was $37.6 million or 8% of the $470 million, which is the fourth highest department in Montgomery County overall.  Reports regarding the other four departments being audited will be issued separately. MCIA is making three recommendations to MCDOT in order to improve the performance and enhance the existing internal controls pertaining to contract monitoring. 
10/4/2013 Audit of Wage Requirement Law Compliance DOT, 
PROC
Contractors who provide services to the County are subject to the Montgomery County Code provisions regarding compliance with certain wage requirements payable to the Contractor's employees. The Office of Business Relations and Compliance (OBRC), Department of General Services (DGS) received notice of allegations that a County contractor, CAMCO, LLC, (CAMCO) was not paying employees in accordance with the County's Wage Requirement Law. CAMCO performs cleaning services for the Montgomery County Department of Transportation (MCDOT). County Code Section 11B-33A (h)(2) directs  the County to enforce the law and  perform random and other audits necessary to do so, and investigate any complaint of a violation.  As a result of the allegations received, the Director of DGS requested the Office of Internal Audit (MCIA) to audit CAMCO's compliance with the law. Our audit also included reviewing aspects of the County's monitoring of its contract with CAMCO. MCIA is making two recommendations to DGS dealing with the its determination of the remedy or remedies to seek against the contractor for statutory or contract violations arising from noncompliance with the Wage Law and two recommendations to MCDOT to improve its contract monitoring procedures related to invoice payment. 
10/07/2013 DGS Implementation of Prior Recommendations on the Wage Law PROC This review was a follow-up assessment of management's progress in addressing a prior report's recommendations through direct inquiry with OBRC and Office of Procurement staff and management. Additional validation was performed through review of documents and information on the DGS section of the County's website and correspondence with OBRC and Office of Procurement employees. We found the Office of Procurement and OBRC have made adequate progress in implementing seven of the 10 report recommendations.  At the time of this review DGS and OBRC are in the process of implementing two of the three remaining recommendations and the actions taken to date were not reviewed for adequacy.  
10/23/2013 Disability Benefit Payments  OHR This audit focused on the disability benefits paid to members of the Employees' Retirement System (ERS), Retirement Savings Plan (RSP) and the Guaranteed Retirement Income Plan (GRIP). As of July 1, 2012 the ERS,  RSP and GRIP had 1,077  and 58 individuals receiving benefits, respectively. The Montgomery County Office of Human Resources (OHR) was responsible for  administering the retirement benefit plans from enrolling plan participants, counseling potential retirees, determining eligibility for retirement, calculating retiree benefit payments, and maintaining retiree records. As of July 1, 2012 the Montgomery County Employee Retirement Plans (MCERP) organization has oversight of the activities previously performed by OHR except for employee enrollment in retirement plans and health insurance. MCIA is making no recommendations. 
03/05/2014 Contract and Grant Monitoring by DED DED This audit of the Department of Economic Development (DED) is part of a continuing review of contract and grant monitoring; DED is the seventh department we are reporting on.  DED FY13 contractual purchase orders totaled approximately $3.4 million or 0.4% of the total $871 million.  MCIA is making three recommendations to DED—two to improve the performance and enhance the existing internal controls pertaining to contract and grant monitoring and one to formalize invoice review and approval procedures. 
04/28/2014 Non-Competitive Procurements PROC Under carefully prescribed circumstances, Montgomery County Code allows County departments to procure goods and services without prior public notice or competition ("non-competitive").  In FY13, the County's total value of purchase orders issued under contracts totaled approximately $871 million, of which $68 million or approximately 8% was issued under non-competitive contracts. The mix of non-competitive awards includes approximately $15.6 million of sole source contracts and $52.5 million through Federal and State grants and County Council designations. The Montgomery County Department of General Services (DGS) Office of Procurement has oversight over the County's procurement process. The Contract Review Committee (CRC) or DGS Director reviews and approves non-competitive procurements.  In addition to evaluating compliance with contract submission and approval requirement, our audit also included reviewing aspects of County departments' review and approval of invoices for non-competitive contracts. MCIA is making two recommendations to the DGS Director to enhance the existing procedures for non-competitive procurements. 
05/06/2014 Carryout Bag Tax FIN, 
DEP
In January 2012, the Montgomery County Carryout Bag Tax went into effect under Bill 8-11. This tax was put into place in response to the increasing amount of litter in the streams and rivers of Montgomery County, specifically plastic bag litter.  As a result, retailers charge customers $0.05 on each plastic bag they provide and remit $.04 to the County and retain a penny. The Department of Finance collects the remitted tax from retailers. For calendar year 2012 retailers remitted $2.2 million in taxes. Funds remitted under the tax are deposited into the Water Quality Protection Charge (WQPC) fund.  The WQPC funds projects for storm water management, litter control, and water quality improvement.  The Department of Environmental Protection (DEP) manages the WQPC fund and monitors established metrics that measure the amount of plastic bags found in County trash and water ways.  This audit reviews the internal controls over the tax remittance collection and the monitoring of the tax impact on resident use of plastic bags. MCIA is making four (4) recommendations to the Department of Finance to improve performance and enhance the existing internal controls related to the bag tax collection and monitoring. 
07/09/2014 DLC Inventory Management  DLC The Montgomery County Department of Liquor Control (DLC) controls the wholesale distribution of all beverage alcohol in Montgomery County and operates 25 retail outlet stores located throughout Montgomery County. DLC operates from a newly relocated centralized warehouse in Gaithersburg and provides wholesale distribution to licensed retailers including DLC operated retail outlets. The overall objective of this audit was to assess the internal controls related to inventory management for DLC and provide recommendations to facilitate process improvement and enhance internal controls, where necessary. The recommendations in this report cover a range of areas. Overarching recommendations include additions or changes to DLC's organization structure and reporting lines to provide increased segregation of duties and independent oversight, implementation of succession planning activities to ensure the ongoing sustainability of the organization. Additional recommendations include enhancements to physical inventory count procedures, and improvement opportunities for warehouse operations, and retail store operations. 
07/30/2014 Continuity of Operation Planning OEMHS The objective of this audit was to determine how effectively the County government is planning for continuity of operations in the event of a disaster.  IT business continuity and disaster recovery was considered a high risk area in the Office of Internal Audit    (MCIA) May 2010 Countywide Risk Assessment. A continuity of operation plan (COOP) is a type of documented plan used by the County to facilitate and define their COOP efforts.  Each department has developed their own continuity program to detail their business continuity procedures. The County's Office of Emergency Management Homeland Security (OEMHS) provides guidance for, and oversight of, the department's planning efforts so that they may be resilient and better prepared to respond to disruptions. MCIA is offering four recommendations to OEMHS to enhance its planning and oversight of departmental COOP activities. 
08/01/2014 United Healthcare Claims  OHR Montgomery County Government (the County) provides healthcare benefits to its employees and retirees primarily using a self-funded, self-insured model. Under this model, the County, through its Office of Human resources (OHR), uses two third party claims administrators (TPAs), Blue Cross Blue Shield and United Healthcare (UHC) to pay claims on behalf of the County. This report covers UHC only. As part of the County-wide risk assessment completed by MCIA, performance of the health care claims administration process was considered high risk due to the nature of outsourcing claims processing and the annual amounts exposed to potential overpayment errors. The claims administration function has not previously been subject to an audit.  MCIA is making three (3) recommendations to the OHR regarding reducing exposure to certain costs subject to contract interpretation and in cases where the County's Summary Plan Description and Contact with UHC is silent or vague.  
08/04/2014 DOCR Escrow Account Funds  DOCR The Department of Corrections and Rehabilitation (DOCR) operates facilities in which approximately 2,000 individuals are incarcerated in the Montgomery County Detention Center (MCDC), the Montgomery County Correctional Facility (MCCF) or housed in the County's Pre-Release and Re-entry center (PRRC).  The PRRC houses and serves individuals that are within 12 months of release from correctional custody.  DOCR holds in an escrow account funds from individuals that are of those incarcerated or housed. The individuals have the funds in their possession, earn or received by outside parties. For year ended June 30, 2013 the escrow account balance for MCDC was approximately $132,000 and the escrow account balance for the PRRC was $75,500.This audit was conducted at the request of DOCR management. The overall objective was to assess the adequacy of the design and operational effectiveness of internal controls surrounding escrow cash balances, facility escrow account systems and the debit card program, and management of DOCR's contract with Keefe Commissary Network, LLC (Keefe). The contract with Keefe is for the use of a commissary system, commissary services and the escrow accounting system used for inmate trust fund accounting. The last audit of the accounts for MCDC and MCCF was in 2002 and for PRRC was 2005. MCIA is making six recommendations to improve MCDC and PRRC's review of transactions including associated corrections, enhance documentation supporting PRRC recording of earnings and fee calculations, and reinforce documentation retention procedures.   
09/12/2014 Contract and Grant Monitoring by Recreation REC As part of the County Wide risk assessment completed by MCIA, contract and grant monitoring by departments was identified as a high risk area. In FY13, the County's total value of purchase orders issued under contracts totaled approximately $871 million. This audit of the Department of Recreation (Recreation) is part of a continuing review of contract and grant monitoring; Recreation is the eighth department we are reporting on. Recreation FY13 contractual purchase orders totaled approximately $19.3 million, or 2% of the total $871 million. MCIA is making two recommendations to Recreation to improve the performance and enhance the existing internal controls pertaining to contract monitoring and invoice review and approval. 
10/02/2014 Wage Requirements Law Compliance: Potomac Disposal, Inc.  PROC Contractors who provide services to the County are subject to the Montgomery County Code provisions regarding compliance with certain wage requirements payable to the Contractor's employees under the County's Wage Requirements Law ("Wage Law"). The Montgomery County Department of General Services (DGS) Office of Business Relations and Compliance (OBRC) is responsible for monitoring compliance with the Wage Law.   The County's Department of Environmental Protection (DEP) has contracts with Potomac Disposal, Inc. ("Potomac Disposal"), to provide residential refuse and recycling collection services. In September 2013, Potomac Disposal workers went on strike, for reasons that included employees claiming that they were not paid the wage amount required by the law. DGS conducted an abbreviated audit in October 2013 and found some violations in the firm's payroll records examined.  As a result, DGS requested the Office of Internal Audit (MCIA) to perform a full Wage Law audit of Potomac Disposal covering all of its employees, for all pay periods between May 2011 and November 2013. MCIA is making two recommendations to DGS dealing with the determination of the remedy or remedies to seek against Potomac Disposal for statutory or contract violations arising from noncompliance with the Wage Law.  DGS said it will take action to require Potomac Disposal to compensate its employees for underpayments as identified in the report, Potomac Disposal told us it would not comment on the report.
11/18/2014 Contract and Grant Monitoring by DHCA DHCA As part of the County Wide risk assessment completed by Montgomery County's Office of Internal Audit (MCIA), contract and grant monitoring by departments was identified as a high risk area. In FY13, the County's total value of purchase orders issued under contracts totaled approximately $733 million. This audit of the Department of Housing and Community Affairs (DHCA) is part of a continuing review of contract and grant monitoring; DHCA is the ninth department we are reporting on. DHCA FY13 contractual purchase orders totaled approximately $5.9 million, or roughly 2% of the total $733 million. MCIA is making 2 recommendations to DHCA to improve the performance and enhance the existing internal controls pertaining to contract monitoring and invoice review and approval. 
03/02/2015 Follow-up Audit of the 2009 Treasury Risk Assessment  FIN The County's Office of Internal Audit (MCIA) performed a follow-up review of an April 2009 risk assessment that was conducted by MCIA on the Treasury Division of the Department of Finance.  The 2009 risk assessment identified weaknesses within 17 process areas with high risk and one process area with medium risk.  Based on the procedures performed during the 2009 risk assessment, 18 recommendations were provided to Finance to address these identified risks.  The recommendations included the formalization of documented policies and procedures, the cross-training of Treasury employees, the standardization of financial reports, and the implementation of internal controls within several key processes. MCIA is making 17 recommendations to the Department of Finance to strengthen its internal controls and improve overall performance.
03/12/2015 Cash Receipts Informational Questionnaire  FIN As a result of the implementation of the Oracle Enterprise Business System in July 2010, the County has been transitioning from a de-centralized cash receipt processing environment to one with a centralized accounts receivable oversight program, and is in the process of developing enterprise wide policies and procedures. Therefore, the Montgomery County Department of Finance sought to compile certain information about the County's cash receipts processing and identify opportunities to improve and strengthen the process and internal controls. Watkins Meegan was engaged by the Montgomery County Office of Internal Audit (MCIA) to assist in the collection of information about cash receipts through the use of a cash receipts questionnaire.  At a high level, MCIA recommends Finance utilize the information gathered to develop a long-term plan, with clear milestones, to continue its efforts to strengthen and enhance the cash receipts process and internal controls across Montgomery County.  The plan should include development of County-wide policies to ensure all departments, offices, and programs are implementing and adopting applicable internal controls consistently. 
03/30/2015 Audit of Montgomery County Conference Center DED The Montgomery County Conference Center (the "Center"), which is owned by the County and operates in conjunction with the Bethesda North Marriott Hotel, owned by JBG. The Center began operations in 2004.  In 2013, the combined facility had $33 million in sales and the Center alone had $16.2 million. The revenue and cost for the facilities are split in accordance with the agreement terms.  The County and JBG engaged Marriott Hotel Services to manage and operate the properties. Marriott has responsibility for ensuring the revenue and cost are allocated to the respective owners in accordance with the agreement terms. Under the agreement the County has the right to audit the financial records of the property. The Department of Economic Development (DED), which has responsibility for overseeing the County's relationship with Marriott, requested MCIA conduct an audit.  DED  is  designated as the Asset Manager for the management agreement with Marriott and it is the primary recipient of all financial reporting and other information on the Center. MCIA is making four recommendations to the DED to improve internal control weaknesses noted. DED concurred with the recommendations.
06/05/2015 Montgomery County Police Department Cash Receipts Internal Controls  MCPD The Office of Internal Audit (MCIA) performed an independent assessment (audit) of new procedures and controls instituted by the Montgomery County Police Department (MCPD) for its processing of cash receipts and payments. Overall, MCIA and MCPD identified 19 suggested actions to enhance the internal control structure over cash receipts to include payment collection, processing, and recording. The second phase of the audit focused on evaluating (1) MCPD's remediation of the suggestions identified in Phase I, and (2) how successfully MCPD implemented them. MCIA is making four recommendations to MCPD including completing the remaining Phase I action items, testing implemented controls, and coordinating with Finance and other appropriate departments on the controls and functions around cash receipts. 
07/14/2015 Audit of Wage Requirements Law Compliance – Unity Disposal & Recycling, LLC  PROC Contractors who provide services to the County are subject to the Montgomery County Code provisions regarding compliance with certain wage requirements payable to the contractor's employees under the County's Wage Requirements Law ("Wage Law"). The Montgomery County Office of Procurement's (Procurement)  Office of Business Relations and Compliance (OBRC) is responsible for monitoring compliance with the Wage Law.  The County's Department of Environmental Protection (DEP) has contracts with Unity Disposal & Recycling, LLC ("Unity Disposal"), to provide residential refuse and recycling collection services.  In May 2014, Procurement requested that the Office of Internal Audit (MCIA) perform a Wage Law audit of Unity Disposal covering all of its employees who perform work in Montgomery County, for a sample of 25% of all pay periods from May 1, 2010 through the start of the audit on May 28, 2014. The audit was conducted by the accounting firm SC&H, under a contract with MCIA. MCIA is making two recommendations to Procurement dealing with the determination of the remedy or remedies to seek against Unity Disposal for statutory or contract violations arising from noncompliance with the Wage Law.  MCIA is making one recommendation to Procurement to take action to assure that Unity Disposal complies with all Wage Law requirements.
10/21/2015 Audit of Wage Requirements Law Compliance – Securitas USA PROC Contractors who provide services to the County are subject to the Montgomery County Code provisions regarding compliance with certain wage requirements payable to the contractor's employees under the County's Wage Requirements Law (Wage Law). The Montgomery County Office of Procurement's (Procurement)  Division of Business Relations and Compliance (DBRC) is responsible for monitoring compliance with the Wage Law. The County's Sheriff's Office has a contract with Securitas USA, Inc. (Securitas), to provide security guard services. In February 2015, Procurement requested that the Office of Internal Audit (MCIA) perform a Wage Law audit of Securitas covering all of its employees who perform work in Montgomery County, to include the months of June 2014, July 2014, December 2014, and January 2015. The audit was conducted by the accounting firm SC&H, under a contract with MCIA. MCIA is making three recommendations to Procurement dealing with the determination of the relief to seek against Securitas for statutory or contract violations arising from noncompliance with the Wage Law.  
11/16/2015 Audit of Wage Requirements Law Compliance – CAMCO, LLC  PROC Contractors who provide services to the County are subject to the Montgomery County Code provisions regarding compliance with certain wage requirements payable to the contractor's employees under the County's Wage Requirements Law ("Wage Law"). The Montgomery County Office of Procurement's (Procurement)  Division of Business Relations and Compliance (DBRC) is responsible for monitoring compliance with the Wage Law. The County's Department of Transportation (MCDOT) has a contract with CAMCO, LLC ("CAMCO"), to provide parking garage cleaning services. In December 2014, Procurement requested that the Office of Internal Audit (MCIA) perform a Wage Law audit of CAMCO. MCIA is making two recommendations to Procurement dealing with the determination of the remedy or remedies to seek against CAMCO for statutory or contract violations arising from noncompliance with the Wage Law.  
01/05/2016 Program Assessment of the Water Quality Protection Charge (WQPC) Program DEP Property owners in the County are subject to the Montgomery County Code provisions regarding the Water Quality Protection Charge (WQPC) under the County's program to design and implement a watershed protection and restoration program. The Montgomery County Department of Environmental Protection (DEP) is responsible for implementation and administration of the WQPC program. In April 2015, DEP requested that the Office of Internal Audit (MCIA) perform a WQPC program assessment of the WQPC program to identify potential improvements needed in the program, using the tax levy year of 2015 as the basis of the assessment. MCIA is making nine recommendations to the DEP to strengthen its internal controls and improve overall performance related to the calculation and assessment of the County's WQPC.  
04/18/2016 Transfer Station Cashier Operations DEP The County's Office of Internal Audit (MCIA), performed an Internal Control Review of the Department of Environmental Protection's (DEP) Transfer Station Cashier operations.  Due to the magnitude of the financial transactions processed at the Transfer Station, DEP requested that this review be conducted to assess the adequacy of the enhanced financial management controls and business process changes DEP is implementing to strengthen the control environment at the Transfer Station and mitigate the future potential for fraud or abuse in the Cashier operations.  This review included an evaluation and limited testing of the control environment of the Transfer Station Cashier operations, a review of the planned control enhancements to assess the adequacy of controls (in-place and planned) in addressing the inherent risks associated with the Cashier operations, and a determination if additional controls or business operation changes are required to address residual risks. MCIA is making 26 recommendations to the Department of Environmental Protection to further strengthen the internal control environment of the Transfer Station Cashier operations.  
05/02/2016 County-Wide Risk Assessment and Multi-Year Internal Audit Plan (FY 2017 – 2020)  CAO This report summarizes work performed by the Montgomery County (County) Office of Internal Audit (MCIA) in support of the County's overall risk management effort.  MCIA conducted an assessment of the current risk environment within the County's Executive Branch offices , and used the results to establish a multi-year (Fiscal Years 2017 – 2020) internal audit plan focused on the County's highest risk areas. 
09/02/2016 Program Assessment of CUPF: Before and After School Childcare Programs in Public Schools  CUPF In addition to other responsibilities, the County's Community Use of Public Facilities (CUPF) provides community users and public agencies with access to public facilities (including schools and other public facilities) for services, programs, and events; and administers this process while managing the placement of Before and After School Childcare Programs in Montgomery County Public Schools (MCPS) facilities, as defined by Montgomery County Executive Regulation 15-14 AMIII (the Regulation; subsequently revised and approved as 15-14AMV, December 8, 2015). The current report focuses on findings and recommendations related to CUPF's administration of the Before and After School Childcare Programs, consistent with the Regulation. MCIA is making 10 recommendations to CUPF to further improve internal processes, as well as enhancing client service delivery and transparency with stakeholders. 
08/05/2016 Program Assessment of CUPF – Reservation of Public Facilities Process  CUPF  In addition to other responsibilities, the County's Community Use of Public Facilities (CUPF) provides community users and public agencies with access to public facilities (including schools and other public facilities) for services, programs, and events; and administers this process while managing the placement of Before and After School Childcare Programs in Montgomery County Public Schools (MCPS) facilities, as defined by Montgomery County Executive Regulation 15-14 AMIII (the Regulation; subsequently revised and approved as 15-14 AMV, December 8, 2015). The current report focuses on findings and recommendations related to CUPF's responsibilities for the scheduling of community use in public schools, regional centers, libraries, and other public spaces. MCIA is making 12 recommendations to CUPF to further improve internal processes, enhance customer service and community outreach, and improve transparency.
11/15/2016 9-1-1 Service Interruption:  Investigative Services  FRS, 
DGS, 
CAO
In the wake of a 9-1-1 service interruption (July 10, 2016) at the County's Emergency Communications Center (ECC), Montgomery County Executive Isiah Leggett directed the conduct of an investigation into the incident to understand what happened and to identify steps that need to be taken to ensure that 9-1-1 services are not interrupted in the future. The review was conducted by the County's Office of Internal Audit (MCIA) with assistance from the National Emergency Number Association (NENA). MCIA is making 19 recommendations to the County and the five departments that played a role in either the events leading up to the incident, the County's efforts to restore 9-1-1 service; or for actions designed to enhance the County's management of its programs or similar situations in the future.
12/09/2016 Silver Spring Apartment Fire: County Response/Recovery Effort and Lessons Learned  OEMHS, 
HHS, 
REC, 
PIO
Montgomery County's Office of Internal Audit (MCIA) conducted this review to identify lessons learned from the County's response and recovery effort in addressing the human and social service needs following the fire that occurred at the Flower Branch Apartment complex in Silver Spring on August 10, 2016.  These lessons learned are designed to assist and strengthen the County's response to future similar incidents. The explosion and fire directly impacted 63 families (168 individuals). Beyond the immediate response by Montgomery County Fire and Rescue Service and Police Department personnel to the incident, the human and social service response and recovery effort by the County, in coordination with non-profits and other organizations who assisted, was unprecedented for the County. This was the largest such incident Montgomery County ever had dealt with and posed unique challenges in meeting the immediate and longer-term needs of the impacted residents.  One related challenge was managing expectations from among various community organizations and public officials regarding the scope of services to be provided during the response/recovery effort.  MCIA is making fourteen recommendations to the County for actions designed to enhance the County's management of similar (i.e., involving large numbers of impacted residents and extended sheltering operations) emergencies in the future.
03/20/2017 Assessment of 9-1-1 Consolidated Emergency Communications Center Transition Plan  FRS Based on a recent a recent 9-1-1 incident review that recommended that the County conduct additional focused assessments of 9-1-1 Operations, the accounting firm of SC&H, under contract with the County's Office of Internal Audit (MCIA) and with assistance from Winbourne Consulting, LLC (Winbourne), performed an assessment of the implementation of the County's plan to transition the Emergency Communication Center (ECC) to a consolidated operations model – creating a singular point of contact for public safety and the community.
The ECC is the primary link between a citizen, who reports an emergency via 9-1-1, and the police, fire and rescue personnel and equipment, who respond to an incident scene. The plan will achieve an organizational model that will transition from an ECC separately staffed and managed by Fire & Rescue Service (MCFRS) personnel and Police Department (MCPD) personnel, to an ECC that is staffed by certified MCPD ECC personnel cross-trained in MCFRS and emergency medical services call-taking and dispatching. MCIA is making eight recommendations to the County, MCFRS and MCPD related to the following areas:  Staffing and Training, the ECC Consolidation Project Charter, ECC Governance and Structure, and the ECC Facilities.  The recommendations are intended to ensure successful and timely transition to consolidated 9-1-1 operations.
5/30/2017 Assessment of County's Implementation Plan for Minimum Wage Law for Tipped Employees (Bill 24-15) HumRights Following enactment of the County's Minimum Wage Law for Tipped Employees (Bill 24-15; enacted June 23, 2015, effective July 1, 2015), the accounting firm of SC&H, under contract with the County's Office of Internal Audit (MCIA), performed a program assessment of the County's implementation plan for this program.  The County's Office of Human Rights (OHR) has responsibility for implementation and administration of the provisions in Bill 24-15.  MCIA has identified four barriers that OHR faces in successfully implementing Bill 24-15, and identifies improvement actions that MCIA believes would assist OHR's implementation plan.
05/30/2017 HIPAA Compliance – Phase 1 Risk Assessment  ACAO Montgomery County sought to assess current compliance with Health Insurance Portability and Accountability Act of 1996 (HIPAA) regulations and to identify risks that the department(s) and the County should address to safeguard personal health information (PHI) and improve its HIPAA compliance level.  CohnReznick was engaged by the Montgomery County Office of Internal Audit (MCIA) to conduct the initial phase of the work. MCIA recommends that the County finalize County-wide HIPAA Policies that are currently in draft form, and ensure that Procedures are comprehensively developed by the Departments that are Covered Components, where required.  Additionally, the County should perform a comprehensive assessment of the status of Business Associate Agreements across all Covered Components to ensure that all Business Associates within the County are properly identified and have an agreement in place.
11/08/2017 Internal Control Review of DLC Retail Store Operations  DLC The Department of Liquor Control (DLC) was established by Montgomery County to regulate the distribution and sale of alcoholic beverages to consumers Countywide. The DLC currently manages and operates 27 retail store locations.  Each location is responsible for managing its inventory, sales, cash operations, and store personnel, with support from the DLC Management and the Department of Finance. MCIA is making 26 recommendations to the DLC to strengthen its internal controls, reduce risk, and improve overall performance related to the oversight, management, and performance of the retail stores.  
11/17/2017 Internal Control Review of Fleet Asset Management Operations  DGS The Department of General Services (DGS) was established by the Montgomery County Government (County) to consolidate functions that provide essential services in support of other County departments. Within the DGS, the Division of Fleet Management Services (Fleet) is responsible for a comprehensive fleet management program for County vehicles.  Fleet Management operates five shops in four main facilities throughout the County. MCIA is making 23 recommendations to the DGS to strengthen its internal controls, reduce risk, and improve overall performance related to management of inventory operations.
05/09/2018 Internal Control Review: Procure to Pay – Specific Functions PROC, 
FIN
The Office of Procurement (Procurement) and the Department of Finance (Finance) are responsible for the oversight of activities within the Procure to Pay function that are performed by each department within Montgomery County (the County). As such, their role is critical to ensuring that the departments adhere to the policies and requirements related to the use of public funds.  MCIA is making five recommendations to the County to strengthen internal controls, reduce risk, and improve overall oversight and performance. The recommendations are related to specific aspects of the County's Procure to Pay operations, and agreements for purchases or programs deemed to be exempt from, or not subject to, procurement regulations.

 

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