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2008 Nebraska Joint Audit

2008 Nebraska Joint Audit. Late in 2007 the jurisdiction of Nebraska started planning a joint audit of one of its mega carriers.

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2008 Nebraska Joint Audit

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  1. 2008 Nebraska Joint Audit

  2. Late in 2007 the jurisdiction of Nebraska started planning a joint audit of one of its mega carriers. The problem that faced the Nebraska staff was how to audit a carrier that is listed as one of North America’s top 100 largest carriers-- within a reasonable time frame and with an audit staff of only 6. Several issues were considered- How much time would it take to complete an IFTA and IRP audit? Should we be concerned over our yearly IFTA and IRP audit count? If we asked others to help, could the audit be completed faster, and in more detail? Would people come to help? Did we want to have over a dozen other jurisdictions and nearly 30 auditors scrutinizing our every move, our every decision?

  3. Who's responsibility is it to audit a mega carrier?In the case of the Nebraska audit, the carrier operated thousands of power units in all of North America.They reported travel in all jurisdictions.Of its hundreds of millions of miles traveled per year, less than 5% of those miles were traveled in Nebraska. The other 95% was traveled in your jurisdictions.

  4. When the decision was made that we could not go it alone and finish the work before we retired- we considered a whole host of issues- When would the audit be done? How many auditors would we need? Would they come? Who do you ask? When do you ask? How long did we need help? Would we have disagreements? How would they be handled? Software issues? Travel issues?

  5. Funding issuesDifferences in audit methodology IFTA or IRP only auditorsWeather issues Who is in charge and how far do you let the other jurisdictions have a say in the audit results?Do you ask for experienced people or will new auditors be ok?Then, there was the necessary little things to consider-Hotel and transportation How to get staff to and from the audit location?

  6. When do you ask for help? If you live up north, don’t start your audit in February when weather can be a travel issue. (Anyway, people down south don’t own coats, so they will not come!). Beware of other “joint audits” going on during yours! You have to give people time to decide if they can come once you ask. Do your audit as soon as possible in the beginning of the year.

  7. Think logically, think weeks and months ahead…How many auditors can you host at one time?When the decision was made to ask for help, we knew we couldn’t fly in 30 auditors all at once. How long would it take to get 30 people organized and running if you did?Make it easy on others and yourself. Set aside a reasonable time table and set those dates out for people and jurisdictions to decide when they can and can not come. If you estimate the audit will take 6 weeks to schedule the miles and fuel, then tell people you have a choice of which 6 weeks they could attend.This worked like a charm.

  8. You'll wear a few hats-Be a sales person-Its ok to grovel when you need help.Be a travel agent-People don’t know your little corner of the world as well as you do. If you want people to come, you have to roll out the red carpet.Talk and walk like you have a plan-You’re the leader, think of the unexpected.Be ready before people show up.

  9. What jurisdiction selection criteria was used?-Start with the IFTA and IRP reports and returns.- What jurisdiction had the highest mileage percentages?

  10. Further considerations-How large is the fleet?What kind of records do they have? (Get your head around this issue quickly!)Paper records vs. electronic records will make a huge difference in time.How many years are you going to audit?How many units will be in your sample size?How many miles or trips does an average unit travel per quarter?Know where all their IFTA and IRP accounts are located.

  11. Sample size is key1 unit per auditor per day divided by the number in the sample plus 10% more time to cover-Auditor experience- Instruction in using different working papers-Auditor pace- and the little surprises that always come up.Other issues to consider- Will Audit Committees members be on your list?

  12. Who’s responsible for the decisions of the audit? This is a disputed and often questioned issue. Nebraska viewed its assisting jurisdictions as “Partners”. If we are truly uniform, there should be no issue or differences in the audit methodology, interpretation or application of audit adjustments. If you feel there is, do we have a problem? In the Nebraska joint audit, everyone had an equal say. Issues were discussed and decided as a group. Nobody's thoughts were ignored or discounted. We only had two issues during the entire audit that required a vote of opinions--- and when that was done, we all agreed and respected the results of those decisions. I cannot over stress the importance of this..

  13. The most important thing to remember is to LISTEN and keep an open mind. Can you afford to go it alone? Who wins when you ask for help?Everyone.

  14. Joint audits could offer you some benefits- Legal actions- Large audits always draw attention and scrutiny. How do you reduce the chances of dispute? Take the time to discuss and fix your differences. You might find you'll learn something.

  15. What did we learn?Myths- “Nobody will go due to travel costs”-NOT TRUE. Only 2 jurisdictions I asked were unable to come.Matter of fact, several jurisdictions offered to send more auditors for longer periods of time!You'll have software issues between auditor programs-NOT TRUE.I've never understood this argument.. What software issues? Only the base jurisdiction runs up the results of the audit findings using their audit software/program.The base created the worksheets that were circulated between all the auditors to use when they arrived. It took only moments to upload the working papers to their lap-tops, and within minutes the auditor was scheduling miles and fuel.

  16. IFTA only auditors vs. IRP only auditorsThis made absolutely no difference what-so-ever. Who is in charge and how far do you let the other jurisdictions have a say in the audit results?The base is in charge. Let everyone have a say. Why not? Do you ask for experienced people or will new auditors be ok?There were benefits of both!

  17. The benefits of joint audits..If you don’t have a large enough staff, do you have a choice?With others- you are able to complete, what otherwise maybe difficult to complete alone. The “audit” is completed faster for both you and the carrier. The more jurisdictions that are involved with the process, the fewer problems you may have later in a dispute. For those jurisdictions with mega carriers, this is a real concern.There is value in numbers.You may learn something from others…More joint audits need to be done.

  18. Who was there? ALABAMATEXASSOUTH DAKOTA WISCONSINKANSASSOUTH CAROLINA OKLAHOMAIOWAONTARIO PENNSYLVANIAWYOMINGIDAHO NEVADACONNECTICUTMISSISSIPPI MISSOURINEBRASKA

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