The audit reviewed the city's utility customer services and delinquent accounts to determine if: 1) utility accounts were effectively managed to maximize collections, 2) the collection agency was properly managed, and 3) adequate procedures existed to minimize theft risk. Key findings included that less than 1% of payments were delinquent and sent to collections each year, most delinquent accounts involved tenants or unlabeled customers, electronic and in-person payments were increasing while mail payments decreased, and some customer accounts were missing records or had payment date gaps when turned over to collections.

1. Utility Customer Services
Delinquent Accounts Audit
May 18, 2015 City Council Workshop Meeting

2. Why did we do this audit?
500,000 transactions per year for $141 million
Questions the audit answers?
1. Are utility accounts managed effectively to maximize collections?
2. Is the city’s collection agency properly managed?
3. Does the city have adequate procedures to minimize the risk of theft?

3. Why did we do this audit?
500,000 transactions per year for $141 million
Questions the audit answers?
1. Are utility accounts managed effectively to maximize collections?
2. Is the city’s collection agency properly managed?
3. Does the city have adequate procedures to minimize the risk of theft?

4. Why did we do this audit?
500,000 transactions per year for $141 million
Questions the audit answers?
1. Are utility accounts managed effectively to maximize collections?
2. Is the city’s collection agency properly managed?
3. Does the city have adequate procedures to minimize the risk of theft?

5. Why did we do this audit?
500,000 transactions per year for $141 million
Questions the audit answers?
1. Are utility accounts managed effectively to maximize collections?
2. Is the city’s collection agency properly managed?
3. Does the city have adequate procedures to minimize the risk of theft?

7. What is paid? What is sent to collections?
0.86%
0.65%
0.54%
0.43%
$134,000,000
$136,000,000
$138,000,000
$140,000,000
$142,000,000
$144,000,000
2011 2012 2013 2014
Payments Amount to Collections

8. Accounts Sent to Collections (percent of total 8/12-7/14)
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Owners Tenants Contractor Unlabeled

9. Customer Payment Methods (in thousands)
0
10,000
20,000
30,000
40,000
50,000
60,000
Mail Internet Bank Draft Counter Department Wire Other
2012 2013 2014

10. Customer Payment Methods (in thousands)
0
10,000
20,000
30,000
40,000
50,000
60,000
Mail Internet Bank Draft Counter Department Wire Other
2012 2013 2014

11. “If you know how to beg, we have an
opening in our Collections Department.”

12. Invoice & Delinquent Payment Dates Gaps
Gap No. Accounts %
Less 1 month 183 26%
1-2 months 214 30%
2-3 months 71 10%
3-6 months 124 17%
6-12 months 53 7%
1-2 years 37 5%
2-3 years 20 3%
3+ years 12 2%
Total 714 100%

13. Accounts Missing from MVBA’s Records
Yr-Mnth to
Collections
Non-
reconciled
Total
Amount
Average
Amount
2012 10 $5,908 $591
2013 4 $1,796 $449
2014 14 $3,769 $269
Total: 28 $11,472 $410