A Follow-up Audit Report on Flight Services Provided by the Department of Transportation's Aviation Division Flight Services Section
October 2008
Report Number 09-011
Overall Conclusion
The Department of Transportation (Department) has substantially implemented four of five recommendations the State Auditor's Office made in 2006 regarding flights provided by the Department's Aviation Division Flight Services Section. The Department's implementation of the remaining recommendation is in progress. For example, the Department has:
- Increased the hourly rates charged for flights twice since the 2006 audit.
- Increased the number of passengers per flight.
While the Department has made progress, it is still incurring a financial loss in providing flights. In September 2006, the State Auditor's Office reported that the Department incurred a loss of $972,441 on flights in fiscal year 2006. During the current audit:
- When all applicable direct and indirect costs are considered, auditors estimated that the Department incurred a loss of $1.4 million on flights only from May 1, 2007, through May 31, 2008.
- Based on a comparison of revenues and expenditures, the Department's entire Flight Services Section (including flights, maintenance, fuel, and hangar services) incurred a total loss of $527,983 from May 1, 2007, through May 31, 2008.
Auditors also noted the following:
- The Flight Services Section still does not consistently ensure that flight log forms and passenger affidavits are completed for each flight.
- The Flight Services Section has drafted a fleet replacement plan, but that plan has not been approved or incorporated into the Department's strategic plan as required by Texas Government Code, Section 2205.032.
The Department obtained a comprehensive review of its flight services by Deloitte Consulting (Deloitte) after the 2006 State Auditor's Office audit. The Deloitte report, completed in December 2006, made 23 recommendations. The State Auditor's Office reviewed eight recommendations and the Department has fully implemented three recommendations and substantially implemented two recommendations. The Department's implementation of three recommendations from that review is in progress.
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