S&S National Waste, Inc.MIAIV\IBEACH
BUDGET AND PERFORMANCE IMPROVEMENT
Internal Audit Division
To: Jorge M. Gonzalez, City Manager
INTERNAL AUDIT REPORT
Via:
From:
Date:
Kathie G. Brooks, Budget and P~rfo·r. ance Improvement Director
James J. Sutter, Internal Audita~-,·i~lhs
September 30, 2011
Audit:
Period:
S & S National Waste, Inc.
March 2008 to February 2011
This report is the result of a scheduled audit of the Roll-Off Fee Returns for S&S National Waste,
Inc. (S&S).
INTRODUCTION
A roll-off is defined as a container with a minimum capacity of ten cubic yards designed to be
transported by a motorized vehicle. They are typically used for the purpose of removing construction
debris, which include rock, metal and other materials used in connection with a construction project or
for the removal of large quantities of trash and bulky waste.
Approximately thirty companies currently possess business tax receipt demonstrating that they operate
roll-offs within the City's boundaries. They are required to abide by the terms outlined in the City Code.
This includes the remittance of franchise fees calculated by using the applicable percentage of Miami
Beach gross receipts. Reports are to be submitted to the City's Finance Department by the end of the
subsequent month. Effective October 2008 the roll-off franchise fee was increased from 16% to18%.
BACKGROUND
Previously, Internal Audit conducted an audit of S&S for period of January 2001 to September 2004.
Our audit report dated March 14, 2005 produced an audit assessment attributed to the under reporting
of gross receipts. At present, the City Attorney's Office and S&S lawyers have been communicating
regarding this audit. Therefore, this matter is still pending.
Internal Audit conducted its previous audit dated October 2008. S&S has been reporting all grappling
services with roll-off services. However, the company under reported fees associated with fuel
surcharges from November 2004 to May 2005 and delivery charges for the entire audit period. While
the audit assessment amounted to $3,284.73, the company has made better efforts to stay compliant
with the ordinance. The audit assessment has been paid.
OVERALL OPINION
A review of the company's invoices showed that franchise fees were charged and collected throughout
the audit period. The following table summarizes the audited gross receipts from roll-off services:
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Internal Audit Report
S&S Waste Removal, Inc. Roll-Off Fees
September 30, 2011
2008 2009
Mar-Dec. Jan-Dec.
Audited $1,195,637.11 $435,671.62 Receipts
Roll-Off
Fees Due $193,902.36 $78,420.89 (18%)
2010 2011 TOTAL Jan-Dec. Jan-Feb.
$154,771.47 $28,572.15 $1,814,652.35
$27,858.85 $5,142.98 $305,325.08
Footnote: As of October 2008 as requ1red pursuant to sect1on 90-278 of the C1ty Code, the
franchise fee paid to the city by its franchise roll-offs contractors was raised from 16% of the
franchisee's total monthly gross receipts to 18% of said gross receipts.
S&S has generally complied with the provisions of the City Code's during the audit period. However,
there is one item relating to reporting as detailed below.
PURPOSE
The purpose of this audit is to determine whether all roll-off waste contractor billings were correct, and
whether all City revenues were correctly calculated, received timely and accurately recorded by the
City, and the contractor was in compliance with designated sections of the City Code and related
Ordinances.
FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSES
1. Finding-Required Reporting
S&S did not submit the following documents in accordance with the listed City Code sections
during the audit period:
a. Section 90-278 (3) states "The licensed roll-off waste contractor shall provide the City
Manager and the Sanitation director with a current list of the names and addresses of
each account, upon initial application and upon application for renewal of its business
license, the frequency of service, the permit number and capacity of each roll-off
container or construction dumpster as per account and the address serviced by each
roll-off container or construction dumpster." S&S has not provided the City Manager
and the Sanitation Director with a current list of names and addresses of each account,
upon the initial application and upon application for renewal of its business license, the
frequency of service, the permit number and capacity of each roll off container or
construction dumpster. However, a list of accounts was provided during the audit.
b. Section 90-278 (4) states "The licensee shall on or before 30 days following the close
of its fiscal year deliver to the Finance Director and the City Manager a statement of its
annual gross receipts generated from accounts within the city certified by an
independent certified public accountant reflecting gross receipts within the city for the
preceding fiscal year". S&S did not provide a statement of its annual gross receipts
generated from accounts within the city certified by an independent public accountant
reflecting gross receipts within the city for the preceding fiscal year. Effective October
1, 2008 the ordinance requires that contractors having an annual gross receipts
reported to the City over $200,000 shall, on or before 60 days following the close of
their fiscal year, deliver to the Finance Department a statement of annual gross receipts
generated from accounts within the city certified by an independent certified public
accountant reflecting gross receipts within the City for the preceding fiscal year. For the
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Internal Audit Report
S&S Waste Removal, Inc. Roll-Off Fees
September 30, 2011
calendar year 2009, S&S exceeded the threshold amount for requiring certified
statements of gross receipt. However, S&S has provided CPA statements during the
audit.
Recommendation (s)
S&S must comply with the designated sections of the City Codes by submitting reports to the
City Manager and Sanitation Director listing of accounts and certified annual statements of
gross receipts for the year exceeding the reported threshold.
EXIT CONFERENCE
Audit findings were e-mailed on 09/08/2011 S&S. We confirmed their agreement to our findings on
09/29/2011.
JJS: CD
Audit performed by Carmin Dufour
F:\obpi\$AUD\DOC010-11\ FINAL REPORT FOR S&S WASTE .doc
cc: Duncan Ballantyne, Assistant City Manager
Fred Beckmann, Public Works Director
Alberto Zamora, Sanitation Director
Patricia Walker, Chief Financial Officer
Janna Wheeler, Comptroller for S&S
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