A Review of the Investigative Report on the Pedernales Electric Cooperative, Inc.
February 2009
Report Number 09-019
Overall Conclusion
The State Auditor's Office has reviewed the Pedernales Electric Cooperative, Inc. Report of Investigation (investigative report) prepared by Navigant Consulting (PI) LLC and published on December 15, 2008. While Navigant Consulting did not conduct an audit, the deficiencies in the Pedernales Electric Cooperative's (PEC) internal controls and organizational structure and the recommendations to remedy the deficiencies detailed in the investigative report rely on some of the same criteria as an audit. Additionally, an auditor would have encountered the same evidentiary limitations (documentation missing or destroyed, witnesses refusing interviews on advice of counsel) that Navigant Consulting encountered while conducting its investigation.
We concur with Navigant Consulting's recommendations for addressing the PEC's governance and management practices that resulted in a lack of effective internal controls. The State Auditor's Office's report includes selected recommendations that the State Auditor's Office noted as significant for improving PEC's internal control structure. In addition, we believe that certain actions, which are primarily based on the Texas Internal Auditing Act, would enhance the recommendation ...that PEC establish an internal audit function....
Contact the SAO about this report.
Download the Acrobat version of this report. (.pdf)
If you prefer an HTML version, follow this link to an Adobe site which converts PDF files to HTML.