RD282 - Wireless E-911 Services Board Report on Audit for the Year Ended June 30, 2010


Executive Summary:
The Wireless E-911 Services Board (Board) has awarded $15.6 million in grants to Virginia Public Safety Answering Points (PSAP) for fiscal year 2010 which, in combination with normal fund expenses, will deplete most of the Board’s available cash and projected revenues over the next fiscal year. Our review found the Board had $10.3 million in outstanding PSAP grant awards at fiscal year-end 2010, with only $11.3 million of cash on hand. Our analysis of fiscal year 2011 revenues, expenses, and outstanding grant commitments, both actual and projected, reveal that the Board has grant commitments and uncertain vendor contingencies for the next fiscal year.

We recommend that the Board and management employ stricter cash management practices to ensure that the timing of grant payments and other expenses does not create a cash flow problem in the future. We also recommend the Board and management consider reducing the PSAP awards in upcoming years, or use other alternatives to reserve a contingency in the event the Board becomes obligated to pay for 2010 vendor services which it neglected to pay in fiscal year 2010.

We also found that management does not validate call and expense data submitted by PSAPs. This data is used to allocate available funding for PSAPs across the state. As a result, the City of Portsmouth may have received more than $900,000 in excess funding for fiscal year 2010. We also identified a number of other significant variances in call and expense data submitted by PSAPs which we found no evidence to explain.

We recommend that the Board direct management to employ formal data validation procedures to deter the potential for misstated PSAP call and expense data. The use of inaccurate PSAP data caused the Board to overpay at least one PSAP. Management must employ stricter data quality controls to ensure that this does not happen again in the future.

Our audit of the Wireless E-911 Services Board (Board) for the year ended June 30, 2010, found:

• proper recording and reporting of all transactions, in all material respects, in the Commonwealth Accounting and Reporting System and the Board’s financial system;

• certain matters involving internal control and its operations necessary to bring to management’s attention; and

• no instances of noncompliance with applicable laws and regulations or other matters that are required to be reported.