Internal Audit Briefing
Presented to the Port of Seattle

Audit Committee and Tay Yoshitani, CEO
Joyce Kirangi, CPA
Director, Internal Audit

December 06, 2011

Agenda
•

Audit Report
1.

Lease and Concession Audits


2.

None

Operational Audits
•
Central Processing System


•

Comprehensive Operational Audit


•

None

3rd Party Audit


•
•
•
•

Airfield Operations

Limited Operational Audit


•

None

None

Peer Review
2011 Work Plan Status Update
2012 Proposed Internal Work Plan
Preliminary Scope Discussion for IT Risk Assessment and Performance Audit

Comprehensive Operational AuditAirfield Operations
Background
The Airfield Operations Department has 24 employees with an annual operating
budget of $3.5 million (exclusive of depreciation expenses). The Department is
responsible for ensuring continuing compliance with the Federal Aviation
Administration (FAA) regulations for airfield operations, operating certification,
training and wildlife management. Additionally, the Department oversees the
Airport Communications Center, and has taken the lead in implementing one of the
nation's first Safety Management Systems at Seattle-Tacoma International Airport
(STIA).
The Department accounts for all airfield revenues, including landing fees, gate fees
and parking fees for all aircraft, in accordance with the fee schedule under Port
Tariff No. 1. During the period under audit, the Department collected at an average
of $62 million annually.

Comprehensive Operational AuditAirfield Operations
Audit Objectives
The purpose of the audit was to determine whether management has implemented
adequate controls to ensure:
1.Revenue generated by the Airfield Operations Department is complete and
accurate
2.Professional services contracts are in compliance with requirements
3.Small and attractive items are properly safeguarded
4.Benchmarks are available and can be used to help improve airport operations
We reviewed information for the period of January 1, 2008, through December 31,
2010, including activity through the end of fieldwork in November 2011.

Comprehensive Operational AuditAirfield Operations
Audit Result


Clean Audit Report

2011 Work Plan Status Update



2011 Work Plan Status
 audit progress attached

Preliminary 2012 Work Plan Discussion

Risk-Based Internal Audit Steps








Understand Port businesses and objectives
Discuss Port risks with Port leadership and Commissioners (see attached)
Identify potential Port wide risks
Link the risk to specific Port objectives that could be disrupted/impaired
Determine and set the scale to be used in the risk assessment
Assess and rank risk factors/drivers
2012 project selection based on risk ranking

Preliminary 2012 Work Plan Discussion
Risk-Based Internal Audit Universe
IT
Risk

Strategic/
Governance
Risk

Business Units/Departments

Operational
Risk

Compliance
Risk

Accountability/
Transparency
Risk

Reporting
Risk

X

X

X

X

X

Lease and Concession
Central Key Processing Systems

X

3RD Party Mgmt.

X

X
X

X

X

Federal Assistance

X

Financial Reporting

X

X

X

X

Capital Improvement Program

X

X

X

X

X

Commission Directives/Policies
Information Technology (IT)
Non-audit Services

X

X
X

X

X

Preliminary 2012 Work Plan Discussion
Preliminary 2012 Audits by Type
Audit Type
Lease and Concession

Limited Operational Audit
Business Units/Departments
3RD Party Management

Central Key Processing System

Count

%
14

44%

8

25%

6

19%

3

9%

1

3%

Preliminary Scope Discussion
for IT Risk Assessment and
Performance Audit


Preliminary Scope attached