Internal Audit Report Hospitality Servicesmca.dadeschools.net/AuditCommittee/AC_January_26... · In accordance with our fiscal year 2015-2016 Annual Audit Plan, we conducted an audit

MIAMI-DADE COUNTY PUBLIC SCHOOLS

Internal Audit Report

■

Hospitality Services

The Financial Statements Were Fairly Stated, Internal Controls Were Satisfactory,

And The Operation Was Fiscally Compliant.

January 2016

THE SCHOOL BOARD OF MIAMI-DADE COUNTY, FLORIDA

Ms. Perla Tabares Hantman, Chair

Dr. Dorothy Bendross-Mindingall, Vice Chair Ms. Susie V. Castillo

Dr. Lawrence S. Feldman Dr. Wilbert “Tee” Holloway

Dr. Martin Karp Ms. Lubby Navarro

Ms. Raquel A. Regalado Dr. Marta Pérez Wurtz

Mr. Alberto M. Carvalho

Superintendent of Schools

Mr. Jose F. Montes de Oca, CPA Chief Auditor

Office of Management and Compliance Audits

Contributors To This Report:

Internal Audit Performed by: Mr. Reginald Lafontant

Property Audit Performed by:

Mr. Rolando Gonzalez

Audits Supervised and Reviewed by: Ms. Maria T. Gonzalez, CPA

Audit Report Prepared by: Ms. Maria T. Gonzalez, CPA

Office of Management and Compliance Audits School Board Administration Building • 1450 N.E. 2nd Ave. • Suite 415 • Miami, FL 33132

305-995-1318 • 305-995-1331 (FAX) • http://mca.dadeschools.net

Chief Auditor José F. Montes de Oca, CPA

January 14, 2016

The Honorable Chair and Members of The School Board of Miami-Dade County, Florida Members of The School Board Audit and Budget Advisory Committee Mr. Alberto M. Carvalho, Superintendent of Schools Ladies and Gentlemen: In accordance with our fiscal year 2015-2016 Annual Audit Plan, we conducted an audit of Hospitality Services for the seven-year audit period July 1, 2008 through June 30, 2015. The objectives of our audit were to express an opinion on the financial statements; evaluate compliance with applicable Florida Statutes, State Board of Education Rules, School Board Policy, as well as general compliance with the Manual of Internal Fund Accounting; evaluate the internal control processes and payroll and property procedures. Based on our audit, we are of the opinion that the financial statements of the internal funds of Hospitality Services present fairly, in all material respects, the changes in fund balances arising from cash transactions during the seven-year period ended June 30, 2015, on the cash basis of accounting. Our assessment of the controls indicated that the internal control structure was generally functioning as designed by the administration. Historically, Hospitality Services has operated for the convenience of staff, business guests, and visitors of Miami-Dade County Public Schools and these services are not only convenient but welcomed. As always, we would like to thank the administration for the cooperation and courtesies extended to our staff during the audit.

Sincerely,

Jose F. Montes de Oca, CPA Chief Auditor Office of Management and Compliance Audits

JFM:mtg

i

TABLE OF CONTENTS Page Number

EXECUTIVE SUMMARY .............................................................................................. 1 INTERNAL CONTROLS ............................................................................................... 2 BACKGROUND ............................................................................................................ 3 CASH/INVESTMENT SUMMARY ................................................................................. 4 ORGANIZATIONAL CHART ........................................................................................ 6 OBJECTIVES, SCOPE, AND METHODOLOGY .......................................................... 7 FINANCIAL STATEMENTS ......................................................................................... 9 PRIOR AUDIT FINDINGS TABLE ............................................................................. 16

1

EXECUTIVE SUMMARY Based on our audit, we concluded that the financial statements of the internal funds of Hospitality Services present fairly, in all material respects, the changes in fund balances arising from cash transactions during the fiscal years 2008-2009 through 2014-2015, based upon the cash basis method of accounting. Our assessment of the controls that are in place to promote compliance with the Manual of Internal Fund Accounting indicated that the internal control structure was generally functioning as designed. Please, refer to the internal control tables on page 2 of this report. For property and payroll, our audit concluded that equipment items with an individual cost of $1,000 or more were properly accounted for and payroll procedures were generally adhered to. Historically, Hospitality Services has operated the School Board Administration Building (SBAB) dining facilities for the convenience of staff, business guests, and visitors of Miami-Dade County Public Schools. Consequently, most of the associated payroll costs were subsidized by the District since this activity does not generate sufficient funds to be self-sufficient. At the present time, the District’s annual budget to operate this facility is approximately $940,000. With respect to the items tested, they were in general compliance with the policies and procedures delineated in the Manual of Internal Fund Accounting and with the Payroll Processing Procedures Manual. When conditions came to our attention that were deemed non-reportable, because they were immaterial or inconsequential, they were, nevertheless, discussed with management for their information and follow-up.

2

INTERNAL CONTROLS Our overall evaluation of internal controls for Hospitality Services is summarized in the table below.

INTERNAL CONTROLS RATING CRITERIA SATISFACTORY NEEDS

IMPROVEMENT INADEQUATE

Process Controls

x

Policy & Procedures Compliance

x

Effect x Information Risk x

External Risk (Image) x INTERNAL CONTROLS LEGEND

CRITERIA SATISFACTORY NEEDS IMPROVEMENT

INADEQUATE

Process Controls

Effective Opportunities exist to improve effectiveness

Do not exist or are not reliable

Policy & Procedures Compliance

Non-compliance issues are minor

Non-Compliance Issues may be systemic

Non-compliance issues are pervasive, significant, or have severe consequences

Effect Not likely to impact operations or program outcomes

Impact on outcomes contained

Negative impact on outcomes

Information Risk Information systems are reliable

Data systems are mostly accurate but can be improved

Systems produce incomplete or inaccurate data which may cause inappropriate financial and operational decisions

External Risk (Image) None or low Potential for damage

Severe risk of damage

3

BACKGROUND General Operation Hospitality Services generates revenue from the sale of food items and beverages at its dining facilities. It also receives vendor commissions from the six vending machines located throughout the School Board Administration Building (SBAB) and Annex buildings. The main dining facility is located on the seventh floor of the SBAB and is currently operational. An additional dining facility located in the Annex Building operated until it closed in August 3, 2011 to accommodate expansion of instructional areas in the Annex Building. The revenues generated from these activities are deposited into an internal funds checking account managed at the site by the Director of Hospitality Services. These funds are primarily utilized to purchase provisions used in the preparation of meals. They are also used to purchase cafeteria supplies, equipment, and related miscellaneous expenses; and to subsidize hospitality-related expenses incurred by the District. In addition, they are used to pay for the overtime and hourly payroll of cafeteria employees not otherwise covered with District funds. In addition to the sale of food items and beverages, Hospitality Services is responsible for subsidizing complimentary hospitality on behalf of the District during official meetings and special events. Vendor commissions from the six vending machines and revenues generated from food sales are utilized to subsidize the related expenses. Staff and Administration As of June 2015, Hospitality Services employed 19 full-time employees and one part-time employee. This includes administrative, clerical, and food handling staff members (refer to organizational chart on page 6). Payroll expenditures are covered with District’s funds. Use of Cash and Investments To maximize interest earnings, internal funds not used in the day-to-day operations of the facility are invested in the MDCPS-Money Market Pool Fund, which was earning interest at the rate of 1.29%, 0.76%, 0.57%, 0.54%, 0.50%, 0.62% and 0.64% at the end of each of the respective fiscal years under audit. Similarly, for each of the years under audit, the fund balance deposited in both the interest-bearing checking account and the MDCPS-Money Market Pool Fund amounted to $63,553.19, $807,292.51, $953,418.12, $1,008,293.28, $1,032,707.77, $1,068,123.56 and $1,074,799.44 (refer to the following table for this facility’s cash and investment summary and pages 9-15 of this report for the financial statements).

HO

SPIT

ALI

TY S

ERVI

CES

IN

TER

NA

L FU

ND

S--C

ASH

AN

D/O

R IN

VEST

MEN

TS S

UM

MA

RY

20

08-2

009

THR

OU

GH

201

4-20

15 F

ISC

AL

YEA

RS

FRO

M J

ULY

1, 2

008

TO J

UN

E 30

, 201

5

4

INTE

RNAL

FUN

DS-

CASH

AND

/OR

INVE

STME

NTS

SUMM

ARY

Matu

rity

Date

In

tere

st

Rate

6/3

0/09

6/30/1

0 6/3

0/11

6/30/1

2 6/3

0/13

6/30/1

4 6/3

0/15

Chec

king

Acco

unt:

W

acho

via B

ank,

N. A

. --

0.10

$ 57

,805.4

8 $

82,15

4.67

W

acho

via B

ank,

N. A

. --

0.05

$ 45

,553.4

5

W

ells F

argo

Ban

k, N.

A.

-- --

$

41,0

96.66

$ 4

3,481

.61$

28,1

87.97

$ 2

5,489

.01In

vest

men

t:

MDC

PS-M

oney

Mar

ket P

ool F

und

Open

-end

1.2

9 63

,553.1

9

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.76

80

7,292

.51

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.57

953,4

18.12

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.54

1,0

08,29

3.26

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.50

1,032

,707.7

7

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.62

1,0

68,12

3.56

M

DCPS

-Mon

ey M

arke

t Poo

l Fun

d Op

en-e

nd

0.64

1,074

,799.4

4 TO

TAL

$ 121

,358.6

7$ 8

89,44

7.18

$ 998

,971.5

7 $1

,049,3

89.92

$1,07

6,189

.38$1

,096,3

11.53

$1,10

0,288

.45

5

2007‐08 738,355Receipts

821,413

666,642 670,002

525,598 485,690

521,203 506,739

2007‐08673,069

Disbursements

754,064

536,735

560,477

475,180 458,890

501,081 502,763

0

67,349

197,256

306,781

357,199 383,999

404,121 408,097

‐

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

2007‐08 2008‐09 2009‐10 2010‐11 2011‐12 2012‐13 2013‐14 2014‐15

Hospitality ServicesReceipts/Disbursements/Increase In Fund Balance

For FYs 2008‐09 Through 2014‐15(When Compared to 2007‐08 FY)

Receipts

Disbursements

Increase FundBalance

For fiscal years ended June 30, 2009 to June 30, 2015, operational cash receipts and disbursements processed through the internal funds of Hospitality Services were reflected in the following graph1: In 2007-2008, cash receipts and disbursements amounted to $738,355 and $673,069, respectively, while the internal funds balance amounted to $692,192. From this graph, it can be noted that since the end of the 2007-2008 fiscal year, cash receipts decreased by approximately $231,600, while disbursements decreased by approximately $170,300. Nevertheless, the fund balance continued to increase since 2007-2008. As of the end of 2014-2015, the fund balance (totaling $1,100,288) experienced an overall increase of approximately $408,100.

1 During June 2009, the Internal Funds-General Fund had a balance of $639,182. Before the closing of the year, on June 26, 2009, Hospitality Services transferred $638,182 to the District. This transaction (which left the Internal Funds-General Fund with a balance of $1,000) was part of a district-wide effort to satisfy a receivable from the Schools' Internal Funds created during the 2007-2008 closing to assist with the District’s financials. The District restored the funds to all locations including Hospitality Services in August 2009. In the internal funds records of Hospitality Services, these transactions (on a cash basis) were recorded as a disbursement in 2008-2009 when remitted to the District, and as a receipt in 2009-2010 when restored by the District; thus overstating operational revenues and disbursements for the respective fiscal years. Consequently, the graph above reflects totals in the corresponding fiscal years that were adjusted to exclude these transactions in order to more accurately represent the receipts/disbursements generated by Hospitality Services’ normal operating activities.

H

OSP

ITA

LITY

SER

VIC

ES

OR

GA

NIZ

ATI

ON

AL

CH

AR

T

6

Albe

rto M

. Car

valho

Su

perin

tende

nt of

Scho

ols

Char

les D

. McM

illon

Dire

ctor

SBAB

Dpt.

of H

ospit

ality

Servi

ces

Jaim

e G. T

orre

ns

Chief

Fac

ilities

Offic

er

Sch

ool F

acilit

ies

John

Whit

ehea

d As

sistan

t Sup

erint

ende

nt Of

fice o

f Sch

ool F

acilit

ies

Ivette

Gar

cia

Senio

r Sec

retar

y Br

uce J

acks

on

SBAB

Con

cess

ion M

anag

er

Marth

a Diaz

Ac

coun

ting S

pecia

list

Debb

ie Mc

Intos

h Ad

minis

trativ

e Ass

istan

t

Deisy

Plas

encia

Co

nces

sion W

orke

r Na

ncy R

omer

o Co

nces

sion W

orke

r Si

lfrida

Cas

tro

Assis

tant C

once

ssion

Ma

nage

r

Wilb

er B

errio

s As

sistan

t Con

cess

ion

Mana

ger

Pat M

urph

ree

SBAB

Con

cess

ion

Spec

ialist

II Fran

ces J

ohns

on

SBAB

Con

cess

ion

Spec

ialist

I

Felic

ia Ri

cks

SBAB

Con

cess

ion

Spec

ialist

I

Enem

encia

Nun

ez

Part-

Time S

BAB

Conc

essio

n Sp

ecial

ist I

Mary

Blan

c SB

AB C

once

ssion

Sp

ecial

ist I

Pedr

o Gar

cia

Conc

essio

n Wor

ker

Odaly

s Hod

elin

Conc

essio

n Wor

ker

Nelva

Flor

es

Conc

essio

n Wor

ker

Beatr

iz Ba

stida

s Co

nces

sion W

orke

r An

a Men

doza

Co

nces

sion W

orke

r Be

linda

Wrig

ht Co

nces

sion W

orke

r

7

OBJECTIVES, SCOPE, AND METHODOLOGY The objectives of our audit were to:

• express an opinion on the financial statements; • evaluate compliance with applicable Florida Statutes, State Board of Education

Rules and School Board Policy, and policies and procedures prescribed in the Manual of Internal Fund Accounting;

• evaluate internal controls to determine the extent to which the control components promote compliance with the policies and procedures prescribed by the Manual of Internal Fund Accounting;

• provide assurance to the administration regarding compliance with current payroll procedures prescribed in the Payroll Processing Procedures Manual; and

• determine whether all property items with an individual value of $1,000 or more were accounted for, and whether policies and procedures prescribed by the Manual of Property Control Procedures where adhered to.

Our review of internal funds and property records covered the seven-year fiscal period of July 2008 through June 2015. The scope of the payroll audit was the 2014-2015 fiscal year. Procedures performed to satisfy audit objectives were as follows:

• interviewed staff and reviewed the organizational structure of the facility; • examined, on a test basis, a representative sample of receipts and disbursements,

as well as other subsidiary records; • reviewed the checking account and subsidiary documentation; • reviewed the bookkeeping and cashiering functions; • reviewed policies and procedures regarding the food operation and the hospitality

account; • reviewed vending machine contracts; • visually inspected the dining facilities and the vending machines located throughout

the administrative building; • reviewed payroll records; • reviewed inspection reports and food handler certifications; • verified the inventory of all property items with an individual value of $1,000 or more

assigned to this location; and • performed other audit procedures as deemed necessary.

We conducted our audit in accordance with generally accepted government auditing standards issued by the Comptroller General of the United States of America. The results of our property audit was in all material respects similarly conducted in accordance with the generally accepted government auditing standards, with the exception of the continuing professional education requirement not followed by our property auditors.

8

FINDINGS AND RECOMMENDATIONS None cited/recommended.

FINANCIAL STATEMENTS

9

The following are the internal funds’ annual financial reports for each audited fiscal year. Refer to page 4 for the cash and/or investments summary:

Funds Beginning Balance Receipts Disbursements Net Transfers Ending Balance

Trust 12,729.34$ 193,274.61$ 181,086.04$ (18,714.64)$ 6,203.27$ General 681,830.26 20,394.20 675,202.15 (26,022.31) 1,000.00 Food Service (2,368.00) 607,744.04 535,957.59 44,736.95 114,155.40 Total 692,191.60$ 821,412.85$ 1,392,245.78$ -$ 121,358.67$

Checking: 57,805.48$ Investments: 63,553.19$ Total: 121,358.67$

Miami-Dade County Public Schools

School Internal Funds-Annual Financial ReportAs of June 30, 2009

Hospitality Services--Location No. 9026


10


Trust 6,203.27$ 64,485.18$ 41,875.10$ (15,130.49)$ 13,682.86$ General 1,000.00 643,816.09 8,549.67 241,797.90 878,064.32 Food Service 114,155.40 596,522.64 486,310.63 (226,667.41) (2,300.00) Total 121,358.67 1,304,823.91 536,735.40 - 889,447.18






11


Trust 13,682.86$ 80,067.05$ 41,146.98$ (35,760.00)$ 16,842.93$ General 878,064.32 6,180.06 4,196.92 104,381.18 984,428.64 Food Service (2,300.00) 583,754.44 515,133.26 (68,621.18) (2,300.00) Total 889,447.18 670,001.55 560,477.16 - 998,971.57






12


Trust 16,842.93$ 57,995.79$ 32,550.84$ (29,642.13)$ 12,645.75$ General 984,428.64 18,864.44 22,957.27 58,408.36 1,038,744.17 Food Service (2,300.00) 448,737.95 419,671.72 (28,766.23) (2,000.00) Total 998,971.57 525,598.18 475,179.83 - 1,049,389.92

Checking: 41,096.66$ Investments: 1,008,293.26$ Total: 1,049,389.92$





13


Trust 12,645.75$ 43,495.19$ 30,628.48$ (12,511.84)$ 13,000.62$ General 1,038,744.17 4,731.50 3,577.95 25,291.04 1,065,188.76 Food Service (2,000.00) 437,463.22 424,684.02 (12,779.20) (2,000.00) Total 1,049,389.92 485,689.91 458,890.45 - 1,076,189.38

Checking: 43,481.61$ Investment: 1,032,707.77$ Total: 1,076,189.38$





14


Trust 13,000.62$ 65,605.48$ 30,514.80$ (33,760.76)$ 14,330.54$ General 1,065,188.76 5,415.79 11,682.47 25,058.91 1,083,980.99 Food Service (2,000.00) 450,181.83 458,883.68 8,701.85 (2,000.00) Total 1,076,189.38 521,203.10 501,080.95 - 1,096,311.53






15


Trust 14,330.54$ 40,192.95$ 32,088.70$ (8,824.34)$ 13,610.45$ General 1,083,980.99 6,675.88 3,786.19 1,807.32 1,088,678.00 Food Service (2,000.00) 459,870.63 466,887.65 7,017.02 (2,000.00) Total 1,096,311.53 506,739.46 502,762.54 - 1,100,288.45





HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

16

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t 1.

Hosp

italit

y Ser

vices

Su

bsid

ized

By T

he G

ener

al Fu

nd

Need

s To

Be E

valu

ated

In

Ligh

t of t

he D

istric

t’s

Dete

riora

ting

Fina

ncial

Co

nditi

on

1. In

the sh

ort te

rm co

nside

r ad

justin

g pric

es an

d red

ucing

co

sts. F

or th

e lon

g ter

m,

coor

dinate

with

Pro

cure

ment

Mana

geme

nt Se

rvice

s the

iss

uanc

e of a

Req

uest

for

Infor

matio

n in o

rder

to ga

in an

un

derst

andin

g of th

e pote

ntial

bene

fits of

outso

urcin

g foo

d se

rvice

s at th

e Sch

ool B

oard

Ad

minis

tratio

n (SB

AB) B

uildin

g an

d the

Ann

ex B

uildin

g.

To in

creas

e rev

enue

s, Ho

spita

lity S

ervic

es be

gan o

fferin

g ho

t lunc

h ser

vices

in th

e Ann

ex di

ning f

acilit

y in D

ecem

ber

of 20

05. In

Mar

ch, 2

008,

Hosp

itality

Ser

vices

adjus

ted ov

er

80%

of its

men

u pric

es fo

r bre

akfas

t and

lunc

h item

s. In

Ja

nuar

y 200

9, an

aver

age 7

.5% in

creas

e for

lunc

h entr

ée

spec

ials a

nd an

aver

age 1

7% in

creas

e for

dess

ert p

rices

wa

s effe

cted.

Hosp

itality

Ser

vices

will

conti

nue t

o rev

iew

menu

price

s per

iodica

lly an

d mak

e adju

stmen

ts to

conti

nue

incre

asing

reve

nue w

hile p

rovid

ing se

rvice

s tha

t cus

tomer

s ex

pect.

The

Hos

pitali

ty Se

rvice

s Dire

ctor w

ill re

view

price

ad

justm

ent r

ecom

mend

ation

s with

his i

mmed

iate s

uper

visor

pr

ior to

imple

menta

tion.

Of

fice o

f Sch

ool F

acilit

ies an

d Hos

pitali

ty Se

rvice

s will

work

with

Proc

urem

ent M

anag

emen

t Ser

vices

to ex

plore

the

feasib

ility o

f outs

ourci

ng pa

rt or

all o

f its o

pera

tions

to a

comm

ercia

l food

servi

ce ve

ndor

.

The a

dmini

strati

on ha

s de

termi

ned t

o con

tinue

op

erati

ng th

e SBA

B Di

ning

facilit

y as a

servi

ce to

sta

ff/adm

inistr

ation

; how

ever

, the

Ann

ex D

ining

facil

ity

close

d in A

ugus

t 3, 2

011 d

ue

to ex

pans

ion of

instr

uctio

nal

spac

es in

Ann

ex B

uildin

g and

re

ducti

on of

perso

nnel.

2. In

adeq

uate

Con

trols

Over

Pu

rcha

sing

And

D

isbur

sem

ents

2.1.

Hosp

itality

Ser

vices

shou

ld co

ordin

ate w

ith P

rocu

reme

nt Ma

nage

ment

Servi

ces t

o ne

gotia

te an

d ente

r into

food

Hosp

itality

Ser

vices

conc

urs w

ith th

e rec

omme

ndati

on in

the

Aud

it Rep

ort to

ensu

re co

mplia

nce w

ith th

e Dist

rict’s

pu

rchas

ing an

d disb

urse

ment

contr

ols. H

ospit

ality

Servi

ces h

as re

viewe

d all c

urre

nt Di

strict

bids

relat

ed to

Reco

mmen

datio

ns

imple

mente

d and

issu

es of

co

ntrac

ts an

d bids

show

ed

grea

t impr

ovem

ent d

uring

the

HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

17

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t

contr

acts

or ob

tain v

endo

r qu

otes f

or ite

ms pu

rchas

ed

not o

n con

tract.

Othe

rwise

, the

purch

asing

proc

edur

es

estab

lishe

d in t

he M

anua

l of

Inte

rnal

Fund

Acc

ount

ing

shou

ld be

follo

wed.

food s

ervic

e ope

ratio

n. H

ospit

ality

Servi

ces i

s cur

rentl

y wo

rking

with

Pro

cure

ment

Mana

geme

nt sta

ff to i

ssue

bids

ac

cord

ing to

the M

anua

l of I

nter

nal F

und

Acco

untin

g pr

oced

ures

for g

oods

and s

ervic

es re

quire

d by H

ospit

ality

Servi

ces b

ut cu

rrentl

y not

avail

able

on D

istric

t bids

. Ho

spita

lity S

ervic

es is

also

wor

king w

ith P

rocu

reme

nt Ma

nage

ment

staff t

o obta

in qu

otes f

or pr

oduc

ts tha

t do n

ot ex

ceed

the D

istric

t thre

shold

requ

iring f

orma

l bidd

ing. T

he

Dire

ctor o

f Hos

pitali

ty Se

rvice

s will

revie

w wi

th Pr

ocur

emen

t Man

agem

ent S

ervic

es al

l quo

tes re

ceive

d for

co

mplia

nce w

ith th

e Dist

rict’s

purch

asing

polic

ies.

curre

nt au

dit.

Mino

r disc

repa

ncies

re

gard

ing so

me of

the

vend

ors u

tilize

d wer

e note

d. Th

is wa

s disc

usse

d with

the

Dire

ctor t

o ens

ure c

ompli

ance

go

ing fo

rwar

d.

2.2.

Hosp

itality

Ser

vices

shou

ld ma

intain

copie

s of fo

od

contr

acts,

quote

s and

any

other

docu

menta

tion

supp

ortin

g the

se pu

rchas

es.

Hosp

itality

Ser

vices

now

maint

ains i

n its

files c

opies

of al

l cu

rrent

M-DC

PS bi

d awa

rds u

sed t

o mak

e pur

chas

es

relat

ed to

its fo

od se

rvice

oper

ation

. The

Dire

ctor o

f Ho

spita

lity S

ervic

es w

ill be

resp

onsib

le for

main

tainin

g co

pies o

f all c

urre

nt bid

awar

ds, c

ontra

cts, q

uotes

and

relev

ant d

ocum

ents

in the

Hos

pitali

ty Se

rvice

s offic

e file

s.

Fully

imple

mente

d. Bi

ds an

d qu

otes o

n file

.

2.3.

Ensu

re th

at all

requ

ired

signa

tures

are a

ffixed

to th

e ch

ecks

prior

to pr

oces

sing

paym

ent.

Hosp

itality

Ser

vices

conc

urs w

ith th

e rec

omme

ndati

on in

Au

dit R

epor

t that

all si

gnatu

res m

ust b

e affix

ed to

chec

ks

prior

to is

suan

ce of

paym

ent. C

ontro

l mea

sure

s hav

e bee

n im

pleme

nted a

ccor

ding t

o the

Man

ual o

f Int

erna

l Fun

d Ac

coun

ting

proc

edur

es to

assu

re th

at all

requ

ired s

teps a

re

follow

ed fo

r pay

ment

to ve

ndor

s for

good

s and

servi

ces.

Fully

imple

mente

d. No

ins

tance

s note

d dur

ing

curre

nt au

dit.

3. Ma

nage

men

t Of

Ve

ndin

g Ma

chin

es

Cont

ract

s Ne

eds

Stre

ngth

enin

g

3.1.

Proc

urem

ent M

anag

emen

t Se

rvice

s mus

t stre

ngthe

n the

co

ntrac

t app

rova

l pro

cess

to

A co

ntrac

t-app

rova

l pro

cess

was

in pl

ace t

o req

uire V

endin

g Ma

chine

Agr

eeme

nts to

be si

gned

by P

rocu

reme

nt Ma

nage

ment

Servi

ces,

prior

to ex

ecuti

on, in

orde

r to e

nsur

e

Fully

imple

mente

d. Cu

rrent

bid w

ith se

lected

ve

ndor

up to

June

2016

.

HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

18

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t

ensu

re th

at su

bmitte

d co

ntrac

ts ar

e tim

ely re

viewe

d an

d sub

mitte

d to t

he

Attor

ney’s

Offic

e for

final

revie

w an

d app

rova

l.

that a

ll req

uirem

ents

of the

Agr

eeme

nt we

re m

et by

the

vend

or an

d wou

ld the

n also

be av

ailab

le for

offic

ial

reco

rding

. How

ever

, due

to th

e neg

otiati

ons o

f a co

ntrac

t wi

th DD

Mar

ketin

g, Inc

., for

reve

nue-

gene

ratin

g op

portu

nities

for b

ever

ages

in ve

nding

mac

hines

distr

ict-

wide

, the A

gree

ments

for H

ospit

ality

were

plac

ed on

hold.

Ina

smuc

h as t

he pr

opos

ed re

venu

es by

DD

Marke

ting,

Inc.

were

not in

the b

est in

teres

t of th

e Dist

rict, t

he co

ntrac

t was

re

jected

by th

e Boa

rd. S

ubse

quen

t to th

e reje

ction

of th

e ma

rketin

g con

tract,

the r

outin

g pro

cess

was

not c

omple

ted.

The

Ven

ding M

achin

e Agr

eeme

nt for

m, w

hich w

as

prev

iously

appr

oved

by th

e Atto

rney

’s Of

fice a

s to l

egal

form

and s

uffici

ency

, was

fully

enfor

ceab

le. A

log o

f all V

endin

g Ag

reem

ents

proc

esse

d will

be m

aintai

ned t

o avo

id thi

s oc

curre

nce i

n the

futur

e. Ho

spita

lity S

ervic

es w

ill co

ordin

ate w

ith P

rocu

reme

nt Ma

nage

ment

staff i

n a tim

ely m

anne

r for

revie

w an

d su

bmiss

ion of

all v

endin

g mac

hine c

ontra

cts. H

ospit

ality

Servi

ces h

as es

tablis

hed a

log t

o tra

ck th

e stat

us of

each

ve

nding

mac

hine c

ontra

ct it s

ubmi

ts to

Proc

urem

ent

Mana

geme

nt sta

ff for

their

revie

w an

d app

rova

l.

3.2.

Inves

tigate

the i

ssua

nce o

f a

bid ba

sed u

pon A

cces

s Fee

Co

ncep

t to ha

ve be

tter

contr

ol ov

er co

mmiss

ions

rece

ived.

Proc

urem

ent M

anag

emen

t Ser

vices

agre

es w

ith th

e re

comm

enda

tion a

nd ha

s met

with

Food

and N

utritio

n staf

f to

draft

a bid

for a

fixed

-fee a

rrang

emen

t for v

endin

g ma

chine

s. T

his bi

d will

also i

nclud

e the

beve

rage

-vend

ing

mach

ines o

pera

ted by

the H

ospit

ality

Depa

rtmen

t. The

sp

ecific

ation

s of th

e bid

will i

nclud

e sep

arate

acco

untin

g re

spon

sibilit

ies fo

r Foo

d and

Nutr

ition a

nd th

e Hos

pitali

ty

Fully

imple

mente

d. At

pres

ent

one v

endo

r ser

vices

ma

chine

s and

subm

its

month

ly ac

cess

fixed

-fee.

Howe

ver,

numb

er of

ma

chine

s dec

reas

ed re

sultin

g in

lower

vend

ing

HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

19

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t De

partm

ent, a

nd is

sche

duled

to be

pres

ented

for t

he

Boar

d’s co

nside

ratio

n in J

une 2

009.

comm

ission

s.

4. Gu

ideli

nes F

or P

rovid

ing

Com

plim

enta

ry H

ospi

talit

y

Upd

ated

But

Not

For

mall

y

App

rove

d

4.1.

Upda

te an

d for

mally

appr

ove

curre

nt gu

idelin

es to

ensu

re

cons

isten

cy in

the p

rovis

ion of

co

mplim

entar

y hos

pitali

ty se

rvice

s.

As no

ted in

the A

udit R

epor

t, in o

rder

to re

duce

cost,

Ho

spita

lity S

ervic

es re

vised

the g

uideli

nes f

or pr

ovidi

ng

comp

lemen

tary r

efres

hmen

t ser

vices

. Stric

ter gu

idelin

es

were

imple

mente

d by H

ospit

ality

Servi

ces i

n Apr

il 200

8. Th

e rev

ised g

uideli

nes f

or pr

ovidi

ng co

mplim

entar

y ser

vices

ha

ve no

w be

en ap

prov

ed by

senio

r man

agem

ent.

Guide

lines

will

be re

viewe

d fro

m tim

e to t

ime.

Fully

imple

mente

d. Gu

idelin

es ha

ve be

en

revis

ed.

HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

20

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t 4.2

. Re

visit t

he cu

rrent

$40,0

00

comp

limen

tary h

ospit

ality

thres

hold

to de

termi

ne

wheth

er th

e exp

endit

ures

sh

ould

be cu

rtaile

d goin

g for

ward

.

It is a

nticip

ated t

hat r

ecen

t red

uctio

ns in

perso

nnel

assig

ned

to the

Sch

ool B

oard

Adm

inistr

ation

Com

plex w

ill re

sult i

n low

er ve

nding

mac

hine r

even

ues.

Con

sequ

ently

, to en

sure

ex

pens

es fo

r com

plime

ntary

servi

ces a

re ad

equa

tely

funde

d, Ho

spita

lity S

ervic

es ha

s set

a bud

get fo

r the

se

servi

ces t

hat is

10%

below

the v

endin

g mac

hine p

rofits

du

ring f

iscal

year

2007

-08.

This

repr

esen

ts a r

educ

tion o

f ne

arly

$2,60

0 dur

ing 20

08-0

9 for

an an

nual

budg

et of

appr

oxim

ately

$23,2

00.

Going

forw

ard,

the an

nual

budg

et wi

ll be 1

0% be

low th

e pr

eviou

s yea

r’s re

venu

es. T

he D

irecto

r of H

ospit

ality

Servi

ces w

ill be

resp

onsib

le for

mon

itorin

g exp

ense

s mo

nthly

and,

base

d on t

he re

venu

es re

ceive

d thr

ough

ve

nding

mac

hine o

pera

tions

, mak

e fur

ther r

educ

tions

that

may b

e nec

essa

ry thr

ough

out th

e yea

r.

Hosp

itality

servi

ces t

otaled

be

twee

n $23

,830 a

nd

$44,8

74 du

ring t

he se

ven-

year

perio

d. W

hile i

t is

evide

nt tha

t the d

eman

d for

Ho

spita

lity S

ervic

es ha

s inc

reas

ed, in

contr

ast,

vend

ing co

mmiss

ions h

ave

dimini

shed

due t

o les

s ve

nding

mac

hine a

ctivit

y and

low

er nu

mber

of m

achin

es in

bu

ilding

s. Th

erefo

re, v

endin

g co

mmiss

ions w

ill no

long

er be

ab

le to

cove

r the

Hos

pitali

ty ne

eds o

f the D

istric

t and

re

venu

es fr

om fo

od sa

les ar

e re

quire

d to c

over

the s

hortf

all.

The D

irecto

r of H

ospit

ality

Servi

ces c

losely

mon

itors

volum

e and

expe

nses

mo

nthly

to en

sure

amou

nts

spen

t are

reas

onab

le an

d do

not e

xcee

d Dist

rict g

uideli

nes.

4.3

. Lis

ts of

the na

mes o

f mee

ting

atten

dees

shou

ld be

inclu

ded

Hosp

itality

Ser

vices

shall

requ

est a

ll nam

es of

mee

ting

atten

dees

to be

inclu

ded w

ith re

ques

t for s

ervic

es. T

he

Imple

mente

d. Mi

nor

discre

panc

ies di

scus

sed w

ith

HO

SPIT

ALI

TY S

ERVI

CES

—PR

IOR

AU

DIT

FIN

DIN

GS

TAB

LE

21

Pr

ior A

udit

Find

ings

Fo

llow-

Up o

f Hos

pita

lity S

ervic

es

Audi

tor’s

Com

men

t Re

com

men

datio

ns

Corre

ctive

Act

ion

by M

anag

emen

t as

part

of the

docu

menta

tion.

na

mes o

f all m

eetin

g atte

ndee

s will

be ke

pt on

file w

ith

comp

limen

tary s

ervic

e req

uests

. Non

-comp

lianc

e by a

ny

requ

estin

g dep

artm

ent w

ill be

brou

ght to

the a

ttenti

on of

the

corre

spon

ding m

embe

r of S

uper

inten

dent’

s Cab

inet fo

r ap

prop

riate

actio

n.

Dire

ctor o

f Hos

pitali

ty Se

rvice

s for

conti

nued

co

mplia

nce.

4.4.

Prep

are a

nd m

aintai

n on f

ile

price

lists

relat

ed to

the

comp

limen

tary h

ospit

ality

items

.

Hosp

itality

Ser

vices

has i

n its

file a

price

list fo

r co

mplim

entar

y ser

vices

. The

Dire

ctor o

f Hos

pitali

ty Se

rvice

s wi

ll per

iodica

lly re

view

with

senio

r man

agem

ent th

e pric

ing

struc

ture f

or co

mplem

entar

y ser

vices

and m

ake

adjus

tmen

ts ac

cord

ingly.

In

closin

g, Ho

spita

lity S

ervic

es m

anag

emen

t rec

ogniz

es th

e im

porta

nce o

f adh

ering

to es

tablis

hed M

-DCP

S pu

rchas

ing

guide

lines

and b

est b

usine

ss pr

actic

es. S

taff w

ill en

deav

or

to re

duce

oper

ating

costs

and i

ncre

ase r

even

ues w

hile

conti

nuing

to pr

ovide

quali

ty se

rvice

s to D

istric

t Offic

e em

ploye

es an

d visi

tors.

List is

avail

able

and u

pdate

d. Ho

weve

r, no

t app

rove

d by

supe

rviso

r of D

irecto

r of

Hosp

itality

Ser

vices

.

Anti-Discrimination Policy

Federal and State Laws The School Board of Miami-Dade County, Florida adheres to a policy of nondiscrimination in employment and educational programs/activities and strives affirmatively to provide equal opportunity for all as required by: Title VI of the Civil Rights Act of 1964 - prohibits discrimination on the basis of race, color, religion, or national origin. Title VII of the Civil Rights Act of 1964 as amended - prohibits discrimination in employment on the basis of race, color, religion, gender, or national origin. Title IX of the Education Amendments of 1972 - prohibits discrimination on the basis of gender. Age Discrimination in Employment Act of 1967 (ADEA) as amended - prohibits discrimination on the basis of age with respect to individuals who are at least 40. The Equal Pay Act of 1963 as amended - prohibits gender discrimination in payment of wages to women and men performing substantially equal work in the same establishment. Section 504 of the Rehabilitation Act of 1973 - prohibits discrimination against the disabled. Americans with Disabilities Act of 1990 (ADA) - prohibits discrimination against individuals with disabilities in employment, public service, public accommodations and telecommunications. The Family and Medical Leave Act of 1993 (FMLA) - requires covered employers to provide up to 12 weeks of unpaid, job-protected leave to "eligible" employees for certain family and medical reasons. The Pregnancy Discrimination Act of 1978 - prohibits discrimination in employment on the basis of pregnancy, childbirth, or related medical conditions. Florida Educational Equity Act (FEEA) - prohibits discrimination on the basis of race, gender, national origin, marital status, or handicap against a student or employee. Florida Civil Rights Act of 1992 - secures for all individuals within the state freedom from discrimination because of race, color, religion, sex, national origin, age, handicap, or marital status. Title II of the Genetic Information Nondiscrimination Act of 2008 (GINA) - prohibits discrimination against employees or applicants because of genetic information. Boy Scouts of America Equal Access Act of 2002 – no public school shall deny equal access to, or a fair opportunity for groups to meet on school premises or in school facilities before or after school hours, or discriminate against any group officially affiliated with Boy Scouts of America or any other youth or community group listed in Title 36 (as a patriotic society). Veterans are provided re-employment rights in accordance with P.L. 93-508 (Federal Law) and Section 295.07 (Florida Statutes), which stipulate categorical preferences for employment. In Addition: School Board Policies 1362, 3362, 4362, and 5517 - Prohibit harassment and/or discrimination against students, employees, or applicants on the basis of sex, race, color, ethnic or national origin, religion, marital status, disability, genetic information, age, political beliefs, sexual orientation, gender, gender identification, social and family background, linguistic preference, pregnancy, and any other legally prohibited basis. Retaliation for engaging in a protected activity is also prohibited. Revised: (07.14)

MIAMI-DADE COUNTY PUBLIC SCHOOLS

INTERNAL AUDIT REPORT HOSPITALITY SERVICES

JANUARY 2016

Office of Management and Compliance Audits 1450 N. E. 2nd Avenue, Room 415

Miami, Florida 33132 Tel: (305) 995-1318 ● Fax: (305) 995-1331

http://mca.dadeschools.net

Documents

Internal Audit Report Hospitality Servicesmca.dadeschools.net/AuditCommittee/AC_January_26... · In accordance with our fiscal year 2015-2016 Annual Audit Plan, we conducted an audit