El Paso internal audit office reports Q3 progress; contractor recovers $33,000 in unremitted sales tax

The City of El Paso Internal Audit Department updated the Financial Oversight and Audit Committee on its third‑quarter work on June 18, reporting completed and in‑progress audits, recovery of unremitted sales tax identified by a vendor contract, hotline case status, and steps to accelerate audit cycles.

Miguel Montiel, presenting the Q3 update, said internal audit follows generally accepted government auditing standards and global internal audit standards and listed 12 audits completed to date and a slate of in‑progress and postponed projects. He told the committee a sales‑tax discovery contractor identified two vendors that had not reported sales tax to the state; one vendor owed $60.23 and another owed $33,000, which the contractor helped collect so the city received its portion.

The department reported 11 hotline calls in Q3, with several cases still open and being reviewed by human resources. On tax refunds, staff said the tax office issued about 1,400 refunds totaling a little more than $1.2 million in the quarter; internal audit completed 67 sample reviews that the presentation characterized as covering roughly $1,000,000 in refunded amounts to verify proper approvals and documentation.

Committee members pressed for detail. Representative Nino asked how vendors were identified; Miguel explained the contractor cross‑references city permits and state records (one flagged vendor had an out‑of‑date address listed as the City of Socorro and needed an update to City of El Paso). Nino confirmed the $33,000 represented the city's portion and thanked staff for the recovery, noting sales tax comprises a significant share of the general fund.

Adrian Serrano said the department is pursuing an electronic work‑paper solution and aims to reduce audit turnaround from the current 120 days to a 90‑day target after implementation to increase coverage and audit capacity. Miguel said some audits may carry forward into the next fiscal year due to scheduling and year‑end activities; the department will provide a fourth‑quarter update with completed and carryover items.

The committee received the informational update; the item was not listed for action.