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An Audit Report on the Board of Professional Engineers: A Self-directed, Semi-independent Agency

March 2012

Report Number 12-025

Overall Conclusion

The Board of Professional Engineers (Agency) accurately reported key financial statement account balances for fiscal year 2011, and its key financial controls were working effectively. In addition, the Agency transferred approximately $7.8 million to the State's General Revenue Fund during fiscal year 2011, as required by Texas Civil Statutes, Article 8930.

The Agency had an adequate process for setting fees, and that process was based on the Agency's budgetary needs. Specifically, the Agency used its budget projection to determine the amount of revenues it would need to meet its operating expenditures. The Agency adjusts its fees, as necessary, to collect the desired amount of revenue. The Agency has not changed its licensing fees since March 2004. Its fiscal year 2011 ending fund balance was approximately $1,177,800, which represented an increase of $178,439 from its fiscal year 2008 ending fund balance.

Additionally, the Agency had processes for assessing administrative penalties, and those processes helped ensure that the Agency accurately calculated and consistently applied administrative penalties in accordance with the Texas Administrative Code and the Texas Occupations Code.

The Agency reported accurate results in its reports to the Legislature, the Office of the Governor, the Office of the Comptroller of Public Accounts, the Legislative Budget Board, and the State Auditor's Office in fiscal years 2010 and 2011 for eight of the nine performance measures tested. Those performance measures were:

- Number of Complaints Filed.

- Average Length of Time Required to Resolve a Complaint.

- Number of Complaints Resolved.

- The Number of Complaints Resulting in Disciplinary Action.

- Number of Cases Closed By Action Taken.

- Number of Examination Candidates.

- Number of Licenses.

- Number of Certificate Holders.

The Agency reported inaccurate results for Number of Enforcement Activities Pending Cases.

While the Agency fully implemented three prior audit recommendations to improve its process for reporting performance measure results, additional opportunities exist for the Agency to strengthen certain processes for calculating and reporting performance measures to help ensure continued reporting accuracy.

Auditors communicated other, less significant, issues to Agency management separately in writing. Those issues were related to the Agency's policies and procedures for cash management, travel guidelines, accounts receivables, and budget process.

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