CON TROLS OVER LETHAL AND LESS-LETHAL WEAPONS AND AMMUNITION PERFORMANCE AUDIT MARCH 2016 101 CITY HALL PLAZA | AUDIT SERVICES | FIRST FLOOR, SUITE 1700 | DURHAM, NORTH CAROLINA 27701 DRAFT DRAFT DRAFT DRAFT CITY OF DURHAM AUDIT SERVICES DEPARTMENT “Provides independent, objective assurance and investigative services” DRAFT DRAFT DRAFT DRAFT Director of Audit Services Germaine Brewington, PhD, CPA, CFE, CGMA Assistant Director of Audit Services Sonal Patel, CPA, C IA, CGMA Senior Internal Auditor Claire Mufalo, MBA, MHA Internal Auditor Rahmud Bass, MBA FRAUD, WASTE & ABUSE HOTLINE | 919.560.4213, EXT. 3 WWW.DURHAMNC.GOV/DEPARTMENTS/AUDIT DRAFT DRAFT DRAFT DRAFT CITY OF DURHAM Audit Services Department 101 CITY HALL PLAZA | DURHAM, NC 27701 919.560.4213 | F 919.560.1007 www.DurhamNC.gov To: Audit Services Oversight Committee From: Germaine F. Brewington, Director Audit Services Department Date: April 25, 2016 Re: Controls over Lethal and Non-Lethal Weapons DRAFT DPRerfAormFanTce A u d iDt (MRarcAh 20F16T) DRAFT The Department of Audit Services completed the report on Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit dated March 2016. The purpose of the audit was to evaluate the adequacy of internal controls over lethal and less-lethal weapons and ammunition inventory at the Durham Police Department. This report presents the observations and results of the Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit dated March 2016. City management concur with the recommendations made. Management’s response to the recommendations is included with the attached report. The Department of Audit Services appreciates the contribution of time and other resources from employees of the Durham Police Department. Durham – Where Great Things Happen www.durhamnc.gov DRAFT DRAFT DRAFT DRAFT TABLE OF CONTENTS BACKGROUND INFORMATION 5 EXDECURTIVAE SFUMTM A R DY RAFT DRAFT DRA7 FT OBJECTIVES, SCOPE AND METHODOLOGY 8 AUDIT RESULTS 10 RECOMMENDATIONS 15 MANAGEMENT’S RESPONSE 17 DRAFT DRAFT DRAFT DRAFT BACKGROUND INFORMATION Any firearm, device, instrument, material, or any other substance that is capable of producing gre at bodily harm or death from the manner it is used or intended to be used, may be referred to as a lethal weapon. A firearm, swo rd, knife, pistol, or the like, is a lethal weapon. Less-lethal weapons pose a great risk of lethal injures, but are not likely to cause death or great b odily harm if used in the manner prescribed by the manufacturer. Examples of less-lethal weapons include tasers, pepper spray, a nd tear gas. The Police Department person nel use both lethal and less-lethal weapons in order to carry out their duties and responsibilities. DRALFethTal a n d Dless-RlethAal wFeaTpon s caDn bRe suAsceFptibTle to loDss, RthefAt FT and/or misuse as a result of weak inventory controls. Adequate controls should exist to proper ly safeguard these weapons. In addition to lethal and less-le thal weapons the audit also included a review of controls over ammunition. Ammunition is classified as either duty or practice. Duty ammunition is a more expensive, higher reliability ammunition. It is issued to be carried on duty and is replaced once a year. Practice ammunition is used for firearms training and practice. As per the Police Department staff, all inventories issued and in stock at the various locations amounted to the following as of March 17, 2016. Value of Inventory (March 2016) Firearms $804,583.00 Tasers and Cartridges $364,569.00 Ammunition $198,689.00 Total $1,367, 841.00 As per the above spreadsheet, the Durham Police Department’s firearms were valued at $804,583. This amount is higher than normal because of the on-going exchange of new firearms. Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 5 March 2016 DRAFT DRAFT DRAFT DRAFT BACKGROUND INFORMATION As a result of this exchange the Department currently holds double the amount of firearms . Once the exchange has been completed, the old firearms will be returned to the vendor. This will reduce the total value of fi rearms from $804,583 to $478,550. The Training Division of the Pol ice Department is responsible for oversight of the lethal and less-lethal weapons and ammunition inventory. DRA FT DRAFT DRAFT DRAFT Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 6 March 2016 DRAFT DRAFT DRAFT DRAFT EXECUTIVE SUMMARY Purpose The purpose of the audit was to evaluate the adequacy of internal controls over lethal and less-lethal weapons and ammunition inventory at the Police Department. The Audit Services staff conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient and appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. DRAFT DRAFT DRAFT DRAFT Results in Brief Overall, the Police Department staff had established a control framework over inventory man agement of lethal and less-lethal weapons and ammunition inventory. Adequate controls existed over the issuance of lethal and less-lethal weapons inventory. In addition, adequate segregation of duties existed over lethal and less-lethal weapons and ammunition. The Durham Police Department staff proactively created an Access Database to track ammunition inventory prior to completion of the audit field work. The Police Department staff can enhance the overall controls by: 1) Establishing written procedures for the inventory management process; 2) Performing periodic inventory counts; 3) Strengthening safeguards over shotguns at 2 districts; and 4) Re-assessing access to shotguns at the two afore- mentioned districts. Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 7 March 2016 DRAFT DRAFT DRAFT DRAFT OBJECTIVES, SCOPE AND METHODOLOGY Objectives The objectives of the audit were to:  Evaluate the effectiveness of controls over the management of lethal and less-lethal weapons and ammunition inventory specifically as it relates to issuance, procurement, segregation of duties and tracking; and  Verify controls over the safeguarding of lethal and less- lethal weapons and ammunition inventory. Scope The scope of this engagement included all current practices DRApFertTain in g tDo thRe isAsuaFnceT, m a n aDgemRentA, proFcuTrem en tD andR AFT safeguarding of lethal and less-lethal weapons and ammunition inventory at the Police Departm ent. Transactions related to the purchase of lethal and less-lethal weapons were reviewed for the period of FY 2014, FY 2015 and FY2016. Methodology To accomplish the objectives of this audit, Audit Services staff performed the following steps: 1. Interviewed Police Department Personnel responsible for purchasing, issuing, managing lethal and less-lethal weapons and ammunition; 2. Verified for a selected sample of employees, that the weapon in their possession was the weapon that was assigned to them based on the spreadsheet used to track inventory; 3. Verified the adequacy of controls during issuance of new weapons to the police officers; 4. Reviewed controls over the issuance of lethal and less- lethal weapons inventory for adequacy; 5. Evaluated the adequacy of the inventory tracking system for lethal and less-lethal weapons as well as ammunition; Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 8 March 2016 DRAFT DRAFT DRAFT DRAFT OBJECTIVES, SCOPE AND METHODOLOGY 6. Verified the existence of the lethal and less-lethal inventory in stock at the various lo cations by: a) Randomly selecting items from the excel spreadsheet and verifying the quantity on hand; b) Randomly selecting items from the floor and verifying them t o the excel spreadsheets; 7. Determined the amount of purchases pertaining to lethal and less-lethal weapons and ammunition for FY 2014, FY 2015 and FY 2016; 8. Obtained the total value of the lethal, less-lethal and ammunition inventories; 9. Evaluated segregation o f duties over procuring, issuing, recording and managing of lethal and less-lethal weapons; DRAF1T0. V e r ifDied Rif thAe puFrcThas e o fD lethRal aAnd FlessT-le th a l DweaRponAs FT and ammunition were properly approved; 11. Documented and review ed the methodology for determining the amount of lethal and less-lethal weapons to purchase; 12. Documented and reviewed the methodology for determining the amount of ammunition to purchase; 13. Reviewed the vendor selection process for acquiring lethal and less-lethal weapons as well as ammunition; 14. Verified the adequacy of controls over the safeguarding of lethal and less-lethal weapons as well as ammunition; During the audit, the staff also maintained awareness to the potential existence of fraud. Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 9 March 2016 DRAFT DRAFT DRAFT DRAFT AUDIT RESULTS Overall, the Police Departmen t staff had established a control framework over inventory management of lethal and less-lethal weapons and ammunition inve ntory. However there is room for enhancement in the overall management of this process. Effective Practices:  Adequate controls existed over the issuance of lethal and less-lethal weapons inv entory. All officers were require d to sign an issuing card upon receipt of their assigned firearms. An excel spreadsheet DRAFT w a sD useRd toA traFck Tthis i n foDrmRatioAn. AFudTit S e rv iDces RstafAf FT randomly selected 12 %( 66) officers that were issued firearms and verified th at the firearm in the officer’s possession was the firearm that was assigned to him/her. This verification was ac hieved by comparing the serial numbers of the firearm in the officer’s possession to the serial number on file as per the excel spreadsheet. No exceptions were noted. The Police Department staff were in the process of issuing new firearms to police officers during the time of audit field work. Audit staff observed the firearm swap process for 66 officers to ensure adequate issuance controls were being administered at the time of the swap. No exceptions were noted. Controls over the issuance of tasers were also reviewed. Tasers were issued to officers during in-service training. Upon receipt of the tasers, officers were required to submit the serial number of the taser as well as the cartridges to the issuing officer. An excel spreadsheet was used to track the information relevant to the issuance.  Effective controls existed over management of the lethal weapons inventory. Durham Police Department staff tracked firearms inventory in an excel spreadsheet. The spreadsheet Controls over Lethal and Less-Lethal Weapons and Ammunition Performance Audit 10 March 2016