Fuel Card Process Review. Division of Administrative Services. Report: A-1415DEP-015

Transcription

1 Office of Inspector General Internal Audit Section Florida Department of Environmental Protection March 26, Commonwealth Boulevard, MS 40 Tallahassee, Florida

2 Table of Contents Scope & Objective... 1 Methodology... 1 Background... 2 Results & Conclusions... 3 Findings & Recommendations... 5 Response from the...9

3 The Office of Inspector General (OIG) conducted a Fuel Card 1 Process Review for the Department of Environmental Protection (Department), (Division). This review was initiated as part of the Fiscal Year (FY) Audit Plan. Scope & Objective The scope included a review of Department fuel card usage for FY The objectives of this review were to determine: Management oversight of Department vehicle fuel purchases Whether purchases are reported accurately in compliance with Directive 660 Methodology This review was conducted under the authority of Section , Florida Statutes (F.S.) and was conducted in conformance with the International Standards for the Professional Practice of Internal Auditing, published by the Institute of Internal Auditors. Our procedures included interviews with Division Staff and Department Fleet Coordinators, and review of Monthly Vehicle/Equipment Usage Logs (55-002) and Monthly Log Receipt Submittal Forms (55-005). 1 The current Fuel Card vendor for the State of Florida is WEX Inc. (Wright Express Fleet and Universal Cards) March 26, 2015 Page 1 of 10

4 Background Department Directive 660, State Fuel Card Program, establishes the policies and procedures for staff to operate, maintain, and fuel Department vehicles, boats and other equipment. The Department of Management Services (DMS) has authorized the Department to utilize the State Fuel Card State Term Contract (No ). A Department employee or volunteer approved to use the fuel card must complete the required Department online training. A Personal Identification Number (PIN) is issued to each approved employee to identify fuel purchases. At the time of this review, 2,585 Department employees had approved PINs, and there were 1,493 active fuel and miscellaneous fuel cards used for Department automobiles, boats and other equipment to purchase fuel, lubricants, emergency repair/maintenance services, and car washes. Directive 660, section 7(c) stipulates that a valid driver s license is required and must be verified prior to PIN approval and issuance. According to the Fuel Administrator, valid driver s licenses are verified as part of the process of obtaining a pin. Department employees may utilize State vehicles assigned to their Division/District or Department motor pool. Travel in these vehicles must be recorded on DEP , Monthly Vehicle/Equipment Usage Log, and DEP , Monthly Log Receipt Submittal Form. Receipts must accompany any fuel purchases recorded on DEP on DEP Directive 660, section 7(h) requires Program areas to reconcile forms DEP and DEP prior to posting transactions into the Fleet system and scanning into Oculus by the 12 th day of the following month. March 26, 2015 Page 2 of 10

5 According to Directive 660, section 1, the State fuel card is for official State use only. According to section 8, the Bureau of Finance and Accounting, Disbursement Management Unit will be responsible for the payment and cost allocation of all charges incurred on the State fuel card. Further, Program representatives are responsible for monitoring their EMIS 2 (Equipment Management Information System) and fuel card activities. At the time of this review, the Division of Administration, Bureau of General Services was in the process of updating Directive 660. According to the Bureau of Finance and Accounting Management, the Department paid the fuel card vendor $2,359, during FY Results & Conclusions To determine management oversight of Department vehicle fuel purchases, we interviewed Fleet Coordinators from twelve Program areas, including Regulatory District and Park District offices. 2 EMIS, currently known as Fleet, is a Florida Department of Management Services (DMS) application that manages and monitors the State vehicle maintenance, usage, and replacement information. March 26, 2015 Page 3 of 10

6 were noted: Based on interviews with Fleet Coordinators and Program areas, the following practices Program Area Is a review done to ensure Monthly vehicle usage logs are completed properly? If so, by which position? Is a review done to ensure fuel log mileage aligns with destination? If so, by which position? Are spot checks for fuel purchase reasonableness done? If so, by which position? Southwest District Staff Assistant Staff Assistant verifies using internet maps Staff Assistant verifies fuel receipts match route taken Southeast District Fleet Coordinator Fleet Coordinator reviews Fleet Coordinator reviews South District Vehicle Custodians or Admin Assistant Administrative Assistant reviews Central District Fleet Coordinator No No Northwest District Administrative Secretary No Administrative Secretary Northeast District Operations Analyst 1 Operations Analyst 1 reviews Operations Analyst 1 Division of Recreation and Parks District 1 Fleet Coordinator No No Division of Recreation Fleet Coordinator Fleet Coordinator Fleet Coordinator and Parks District 2 periodically reviews periodically reviews Division of Recreation and Parks District 4 Fleet Coordinator No No Division of Recreation and Parks District 5 Fleet Coordinator Fleet Coordinator reviews No Division of Recreation and Parks District 3 Fleet Coordinator No No Carr/Douglas Motor pool Staff Assistant/Senior Clerk Staff Assistant or Senior Clerk Looks for red flags BMC Motor pool Senior Clerk/Staff Assistant No No No Based on these interviews, some areas of the Department indicated a greater level of management oversight and review than others regarding fuel card activity. To determine whether purchases are reported accurately in compliance with Directive 660, we reviewed a sample of 266 vehicle usage logs for the sample months of August 2013 and March 2014 from the six Regulatory Districts, five Park Districts, and Division offices. We also March 26, 2015 Page 4 of 10

7 reviewed Program offices in Tallahassee that share vehicles in the Department s motor pool. Our review examined vehicle usage logs for completeness and accuracy. This included vehicle and date information, beginning and ending mileage, fuel purchases, travel destination, signatures, and review of receipts. We also compared mileage to destinations and gas receipts for reasonableness. A random sample of miles per gallon for vehicles was also performed. Based on review of the 266 sampled vehicle usage logs, all but one of the Program areas are currently using the DEP and DEP forms. All vehicle usage logs had been scanned into Oculus. However, numerous discrepancies existed regarding information recorded for mileage from odometer readings, fuel costs, amounts purchased, and dates, between vehicle usage logs and receipts. In addition, many vehicle usage logs did not contain sufficient or detailed information regarding mileage driven and destination to justify the daily use or purpose. Based on our review of the Approved PIN List (dated September 3, 2014) and the WEX Transaction List for July 1, 2013 to June 30, 2014, of the 2,585 approved PINs, 717 were not used and 526 were used less than five times during FY Finding and Recommendation Finding: Purchases are not reported accurately and Management oversight is lacking. Directive 660 requires vehicle usage log, DEP , along with Receipt Submittal form, DEP (if applicable), be utilized to record vehicle information, fuel and maintenance purchases, as well as usage. Section 8 states, The Bureau of Finance & Accounting, March 26, 2015 Page 5 of 10

8 Disbursement Management Unit, will be responsible for payment and cost allocation of all charges incurred on the State fuel card. Section 8 further states, Program representatives are responsible for monitoring their EMIS (now Fleet) and fuel card activities. The Bureau of Finance and Accounting is responsible for Department fuel usage payment. However, Programs are responsible to ensure fuel cards are used appropriately and recorded correctly. Directive 660 also states the vehicle usage logs (Section 7.h (1)), must be reconciled and posted to EMIS (currently Fleet) by the 12 th day of the month following each completed calendar month. During our review, Fleet Coordinators indicated that staff reviewed monthly vehicle usage logs to verify completeness prior to scanning. However, most were not reviewing vehicle usage log information to verify mileage and destination for accuracy and reasonableness. During our review of a sample of 266 vehicle usage logs, many discrepancies were found related to mileage, odometer readings, fuel costs, amounts purchased, and dates, between vehicle usage logs and receipts. In addition, many vehicle usage logs did not contain sufficient or detailed information regarding mileage driven and destination to justify the daily use or purpose. These included vague descriptions for travel destination. Some of these instances involved multiple park staff driving a vehicle in a day. Several errors occurred that ranged from transposing mileage amounts, to leaving out key information regarding destination or usage. March 26, 2015 Page 6 of 10

9 These errors and discrepancies demonstrate a lack of sufficient monitoring and oversight to ensure State fuel card use is accurately recorded and vehicle use is for justified Department purposes. The current Directive 660 does not provide specific direction on monthly log reconciliation. However, fuel card training instructs PIN holders to complete vehicle usage logs timely and accurately. All mileage, fuel purchases, maintenance, and repairs for each vehicle should be recorded on the vehicle usage log. Programs are responsible for monitoring fuel card activities; however, no specific procedures are provided as to the extent of monitoring that needs to be conducted. All PIN holders are required to complete the online fuel card training prior to the Program Area s approval for PIN issuance. This training consists of a slide presentation posted on the intranet site. According to the Fuel Administrator, applicants must sign a form stating they have completed the fuel card training prior to being issued a PIN. However, the Fuel Administrator does not verify completion of this training. Recommendation We recommend the Department, through the, require all Program Areas to demonstrate compliance with DEP Directive 660 and put processes in place to document the monitoring of fuel card activities prior to posting transactions into the Fleet system and scanning into Oculus. Further, we recommend the Division of Administrative Services conduct periodic reviews of vehicle usage log transactions for verification of reporting accuracy and use justification. March 26, 2015 Page 7 of 10

10 To promote accountability, integrity, and efficiency in state government, the OIG completes audits and reviews of agency programs, activities, and functions. Our audit was conducted under the authority of Section , F.S., and in conformance with the International Standards for the Professional Practice of Internal Auditing, published by the Institute of Internal Auditors, and Principles and Standards for Offices of Inspector General, published by the Association of Inspectors General. The audit was conducted by Kim Vickery and supervised by Valerie J. Peacock. Please address inquiries regarding this report to the OIG s Audit Director by telephone at (850) Copies of final reports may be viewed and downloaded via the internet at Copies may also be obtained by telephone (850) , by fax (850) , in person or by mail at Department of Environmental Protection, Office of Inspector General, 3900 Commonwealth Boulevard, Mail Station #41, Tallahassee, FL Valerie J. Peacock, Director of Auditing Candie M. Fuller, Inspector General March 26, 2015 Page 8 of 10

11 FLORIDA DEPARTMENT OF ENVIRONMENTAL PROTECTION MARJORY STONEMAN DOUGLAS BUILDING 3900 COMMONWEALTH BOULEVARD TALLAHASSEE, FLORIDA RICK SCOTT GOVERNOR CARLOS LOPEZ-CANTERA LT. GOVERNOR JONATHAN P. STEVERSON SECRETARY MEMORANDUM TO: FROM: SUBJECT: Valerie Peacock, Director of Auditing Office of Inspector General Bob Wilson, Director Review of Department Fuel Card Process A-1415DEP-015 DATE: March 25, 2015 We have reviewed your preliminary report entitled Fuel Card Process Review. Our response to the recommendations noted in the report, as required by section Florida Statutes, appears below. Recommendation: We recommend the Department, through the Division of Administrative Services, require all Program Areas to demonstrate compliance with DEP Directive 660 and put processes in place to document the monitoring of fuel card activities prior to posting transactions into the Fleet system and scanning into Oculus. Further, we recommend the Division of Administrative Services conduct periodic reviews of vehicle usage log transactions for verification of reporting accuracy and use justification. Response: 1. The Bureau of General Services (Bureau) will create a standardized monitoring plan to be used Department wide which will require all Program Areas to demonstrate compliance with DEP Directive 660. The plan will require a Division/District/Office Director certification statement and approval of monitoring activities periodically, annually at a minimum. The process will include verification of monitoring activities both before and after posting transactions into Oculus and Fleet. 2. The Bureau will begin conducting periodic reviews of vehicle usage logs and transactions. The reviews will be based on a percentage of the total number of fuel card activities and the Department s current state of accuracy. When sampling shows a high number of inaccuracies, the percentage of audits will increase. Results of monitoring activities within the Bureau will be sent to the Division/District/Office Director with recommendations for improvements where applicable. Page 9 of 10

12 3. The Bureau will begin providing mandatory and refresher trainings to Program Area Fleet Coordinators annually at a minimum. This training will cover current Department policy and process for this area. 4. The Bureau will update Directive 660 to include language that allows for periodic sampling and monitoring by both Program Areas and the Bureau. Additional language will be added to address training. Thank you for the opportunity to respond to your findings and recommendations. This report will be helpful in enhancing the Department s accountability in this area. Should you have any questions, please contact me at Page 10 of 10