VIRGINIA BEACH, Va. (WAVY) — The Virginia Beach City Auditor says Public Works needs to do a better job at keeping track of its multi-million dollar inventory.
The latest audit was just finished and Auditor Lyndon Remias says it is concerning.
“Despite having approximately, $3.3 million of inventory Public Works has never completed a full physical inventory of the Public Works Operation storeroom,” Remias said. “This is a critical key to internal control over inventory. A yearly physical inventory helps to determine whether book inventory and on-hand quantities agree, and very importantly helps to determine if internal controls are working effectively to minimize risk of shrinkage.”
“It is just a huge operation,” added Drew Lankford with Public Works. “We are the third largest department in the city.”
Public Works has the largest inventory in the city. The shelves are filled with traffic lights and signs. The inventory also includes sand and salt. Remias says the items are not properly being cataloged.
“Items could be missing,” Remias said. “Items could be unaccounted for and you would not know unless you get an inventory.”
Remias says his department identified over $5.1 million in inaccurate unit costs. This was caused by imputing incorrect numbers. The adjustment for the inaccurate unit costs brought inventory down to approximately $3.3 million. He says February 2, 2016, the inventory system showed reported $8.4 million in inventory. Remias says if physical inventory has been regularly conducted such discrepancies would had been identified earlier.
Remias believes none of the items were stolen.
Public Works is now working to fix the issues. It is counting the inventory and needs to have final numbers for the auditor by the end of June.
“It happened and it shouldn’t have happened,” Lankford added. “Nobody is disagreeing with the auditor.”
“At the end of the day, it is tax payer dollars that are being utilized to purchase the inventory so we want to make sure we have accountability so that if that if something is missing we are aware,” Remias said.