Fayetteville internal audit reports improved inventory controls, flags obsolete materials for disposal

An internal audit update to Fayetteville City officials covered completed reviews and inventory-control improvements and identified follow-up tasks for obsolete or low-use materials.

The internal auditor said they completed a detailed retirement savings plan review and reconciliation and found no reportable issues. "I took my time with that one because I hadn't done a retirement review like that," the auditor said, adding the next review should be faster because staff are now familiar with the source documentation.

The auditor also described recent inventory tests for water and sewer parts. After implementing biweekly counts for high-dollar parts and a blind-count manager-recount process, the inventory variance improved from a negative 3.06% at last year's final count to about 0.5% in the recent tests. "Since implementing those counts, we've dropped our variance down to point 5%," the internal auditor said.

Internal audit explained their physical-count procedures: selecting parts for blind counts, separating zero-quantity items for manager verification, entering counts into spreadsheets to flag outliers for manager recounts, and using a third-count step for disputed items. The auditor noted some items—such as long-stored sewer pipe and slow-moving parts—appear unused for years and will need management direction on whether to sell, dispose of, or retain the stock.

Next steps: internal audit will perform preliminary fuel inventory counts for the new fleet fueling system, review airport ticketing controls after a shift to iPads, and follow up with management on disposal plans for obsolete inventory items. The audit work plan otherwise remains on track with only one or two items likely to roll into the next fiscal year.