The audit was conducted in accordance with Generally Accepted Government Auditing Standards issued by the comptroller general of the United States.
ONPA performed this audit after a recent financial audit done by Deloitte and Touche revealed that Telecom’s corporate credit cards had been used for personal purchases.
In reviewing Telecom’s credit card practices, the ONPA found that personal use of the credit cards occurred routinely.
Telecom’s executives charged over $27,000 of personal items during the audit period of October 2006 through May 2009.
Over $7,000 of personal charges was still owed to Telecom as of May 2009 of which $3,600 had been owed for more than 240 days.
Telecom’s executives did not always submit supporting documents for purchases made with credit cards. As a result, the audit could not verify the validity of 107 transactions totaling $41,528. Of these, 80 transactions totaling $25,697 in airfare, hotel and restaurant could not be verified as to business-related or personal because Telecom did not retain receipts or invoices.
Telecom incurred interest and late charges resulting from the personal use. A total of $2,294 in interest charges and late fees was incurred during the period of audit; however, it could not be determined how much was actually caused by personal charges. Credit cards were used by the officers to pay for meals and entertainment and charged to representation expenditures. In 10 of the 12 months of fiscal year 2008, one officer charged more than $1,000 per month in meals and entertainment. It was found that 41 meals and receptions exceeded $500 each during the period of audit.
