OCA Audit Reports

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Issued: October 2005

SUMMARY

This audit was approved as part of the Office of the City Auditor (OCA) 2005 Service Plan, based on indications of unaccounted-for fuel at Austin-Bergstrom International Airport (ABIA), leading to concerns of fuel theft or environmental leakage.

We found that Department of Aviation (DOA) management has in place some controls aimed at ensuring that fuel revenue is collected, and it appears that the majority of fuel revenue due is being collected. However, while DOA identified rather sizable fuel discrepancies, they were unable to adequately resolve them. Fortunately, most of the discrepancies we saw during our work were not due to theft or leakage, but were reporting issues. However, the reporting issues represent potential revenue due to DOA, as well as some unnecessary fuel handling and transport across the airport. A rough estimate of the potential revenue due for the 2½-year scope period is $140,000, but this is a very preliminary estimate and further analysis is needed.

The actual revenue due will need to be determined through additional steps by DOA such as audit or legal opinions or other means, including some additional tenant reporting on past activities. However, we identified some control weaknesses over tenant fuel accounting and reporting, reducing ability to rely on such reporting without independent verification. Therefore, DOA should identify steps needed to obtain assurance on determinations made of past revenue due.

However, without waiting for the results of that inquiry, immediate action is needed to clarify ABIA policies, intentions, and requirements related to fuel handling and reporting at ABIA. We found that contract terms should be re-examined and more precisely defined, communicated, and enforced; additional reporting and supporting documentation should be required; and an active monitoring presence is needed. In addition, other opportunities exist for process improvements to improve fuel accountability overall. Thus, oversight and monitoring can be strengthened to provide greater assurance of fuel accountability, both for revenue protection and for environmental protection purposes.

On the environmental side, DOA staff is actively monitoring environmental issues related to fuel usage at the airport. The DOA environmental program uses a teamwork approach with ABIA tenants and is having positive effects. This helps to alleviate concerns about fuel leakage. However, because the majority of the environmental monitoring risk is borne by DOA and the City, some improvements are recommended to further strengthen the program. We noted a few opportunities to strengthen analysis and reporting related to environmental inspections and spill data, which would help clarify relative levels of tenant compliance with environmental requirements. These improvements would allow identification of overall patterns or issues needing attention, help ensure the consistency and continuity of the program, and provide additional assurance to upper management (DOA and City) throughout the year that fuel is handled properly.

Download the entire text of our Austin-Bergstrom International Airport (ABIA) Fuel audit (Size: 277 KB) in Adobe Acrobat. You may also view ABIA's action plan (Size: 21.3 KB) developed subsequent to this report issuance. You will need Adobe's Acrobat Reader to view these files. Or request a hard copy of this audit report, No. AU05106, and the ABIA Action Plan by submitting this audit report request form.

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