Pronto Waste Services Inc.BUDGET AND PERFORMANCE IMPROVEMENT
Internal Audit Division INTERNAL AUDIT REPORT
TO:
VIA:
FROM:
Jimmy L. Morales, City Manager
John Woodruff, Budget and Performance Improvement Director ®
James J. Sutter, Internal AuditoV
June 25,2014 Jlr DATE:
AUDIT:
PERIOD:
Pronto Waste Services, Inc. (Pronto Waste)
June 2012 to May 2014
This report is the result of a scheduled audit of the Roll-off Fee Returns for Pronto Waste, Inc.
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 to operate Roll-offs
within the City's boundaries. In return, 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.
Pronto Waste has been operating in the City of Miami Beach since June 2003. Their majority
lines of business are demolition contractors, concrete cutting, excavation & land clearing,
trucking & lowboy service, equipment rental. In addition, Pronto Waste provides Roll-off
services as a supplemental line of business.
BACKGROUND
Previously, Internal Audit conducted an audit of Pronto Waste for period of March 2009 to May
2012. Our audit dated August 21, 2012 produced an audit assessment of $6,688.99. This
assessment was attributed to under reporting of Roll-off revenues. Pronto Waste has paid the
total amount of the audit assessment.
OVERALL OPINION
Pronto Waste has not fully complied with ·the City Codes as it relates to reporting requirements
for Roll-off contractors. As a result, gross receipts were collected and not remitted to the City.
The following items were noted during audit:
• Gross receipts in the amount of $18,016.00 were not reported. Therefore, Pronto Waste
owes the City $4,586.16 in franchise fees. (including interest and late filing charges)
We are committed to providing excellent public service and safely to all who live, work, and play in our vibrant, tropical, historic communily.
Internal Audit Report
Pronto Waste Services, Inc.
June 25, 2014
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.
SCOPE
1. Review waste contractor's books and records to confirm that their billings were correct;
their gross receipts were correctly calculated and support the monthly franchise fee
submitted to the City.
2. Confirm that the private waste contractor timely sent the City the required reports in
adherence with the terms listed in the City Code.
3. Confirm that the private waste contractor is timely sending the required Monthly Report
of Gross Receipts along with their remittance to the City.
4. Confirm that the private waste contractor timely obtained their required annual business
tax receipt.
5. Confirm that the private waste contractor timely submitted their annual Certified Public
Accountant (CPA) Statements of Gross Receipts to the City (If applicable).
6. Confirm that the private waste contractor has obtained the required insurance in
adherence with Section 90-196 of the City Code.
7. Confirm that all monthly Roll-off Fee Returns were timely and correctly recorded in the
City's Financial System.
FINDINGS, RECOMMENDATIONS AND MANAGEMENT RESPONSE
1. Finding-Unreported Gross Receipts
City Code Section 90 -221 defines gross receipts as "the entire amount of the fees
collected by the licensee, exclusive of taxes as provided by law, whether wholly or
partially collected, within the city, for solid waste removal and disposal". Therefore, all
monies collected by the Roll-off waste contractor from Miami Beach service addresses,
including dump fees, fuel surcharges, dry run and overload should be included in
reported gross receipts.
Out of 24 months audited gross receipts, Pronto Waste did not file any returns to the City
for the entire audit period. Pronto Waste charged and collected $18,016.00 in gross
receipts including franchise fees from customers. However, they failed to remit the
amount of $3,242.88 in franchise fees for roll-off waste removal services within the city
limits.
Therefore, Pronto Waste is not in compliance with the City Code. The following table
summarizes audited gross receipts and the amount due from Pronto Waste for our audit
period:
Page 2 of 4
Internal Audit Report
Pronto Waste Services, Inc.
June 25, 2014
Audited Gross
Receipts
Less Report
Gross Receipt
Unreported
Revenues
Roll-off fees due
Interest
Late
Total Due
Recommendation( s)
2012
(Jun-Dec.)
$2,300.00
(2,300.00)
414.00
414.00
65.64
350.00
$829.64
2013 2014 TOTAL
Jan-Dec. Jan-May
$13,439.00 $2,277.00 $18,016.00
( 13,439.00) (2,277.00) (18,016.00)
2,419.02 409.86 3,242.88
2,419.02 409.86 3,242.88
166.21 11.43 243.28
550.00 200.00 1,100.00
$3,135.23 $621.29 $4,586.16
Pronto Waste should remit the amount of $4,586.16. All subsequent roll-off fees return
should be filed in a timely manner and remit any franchise tax due. Going
forward, if Pronto Waste continues not to pay the City of Miami Beach the franchise
fees collected from service addresses within the City may result in the termination of
their business tax receipt.
2. Finding -Required Reporting
Pronto Waste did not submit the following documents in accordance with the listed City
Code sections during the audit period:
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." Pronto Waste 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. However, a listing of customer names was provided during the audit.
Recommendation( s)
Pronto Waste must comply with the designated sections of the City Codes by submitting
a list of accounts annually.
EXIT CONFERENCE
Audit findings were e-mailed on June 13, 2014 to Nancy Arencibia, Manager of Pronto Waste
Services, Inc. We confirmed her agreement to our findings on June 23, 2014.
Page 3 of 4
Internal Audit Report
Pronto Waste Services, Inc.
June 25, 2014
JJS: CD
Audit performed by Carmin Dufour
F:\obpi\$AUD\DOC013-14\REPORTS-FINAL\PRONTO WASTE.doc
cc: Eric Carpenter, Public Works Director
Alberto Zamora, Sanitation Director
Patricia Walker, Chief Financial Officer
Nancy Arencibia, Pronto Waste Services, Inc.
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