Auditing the audit

Some of the comments on today’s Columbia River Crossing story bashed the fact that the Washington State Department of Transportation conducted an internal audit of the project.

One thing to make clear: internal audits are common. And effective. Don’t know if you all remember the Stacee Sellers fiasco, but it was a state internal audit of the city’s finances that uncovered her now-infamous trips to the Eye Candy Lounge.

However, forensic accountant Tiffany Couch, had a different perspective.

The internal auditors did a laudable job. But, she asked: Is this the right scope of an audit anyway?

She got back to me too late last night to make the story for publication (and commented on the story today).

But here’s what she wrote in response to me sending along the documents last night:

“I’ve performed a cursory review only. Basically, they tested invoices to make sure they had appropriate approvals, matched a task order, that job titles matched approved types of people working on the job, etc.

Lots of minutiae.

It’s good to have processes and procedures such as these to make sure certain internal controls are working. My work thus far has been at a much higher level, though. And, my work has identified many questions that haven’t been addressed in this report.

Why don’t they have an accounting system that provides for a ‘push the button’ accounting of the project?

Who is approving these enormous changes to the contract?

Who is approving these major change orders which add millions upon millions of dollars to the project?

Why are we paying a markup fee on all subconsultant invoices when this very same auditor addressed on January 26, 2010 that the agreements didn’t allow for the payments at all?

Who is calling a ‘time out’ when issues such as gross time and budget overruns, issues with design, issues with bridge height, issues with financing are discovered? The internal auditor had a very narrow scope and he did his job well.

At this point, however, the issues that I and others have identified related to this project are much more important than ‘who approved this particular invoice.'”

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