May 16

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City of Los Angeles Wastes $1M on Cell Phones

Los Angeles City Controller, Wendy Greuel, recently conducted an audit of seven Los Angeles city departments relating to city-owned cell phones.  Greuel found that the city wastes about $1 million per year on nearly 12,000 city-owned cell phones.  Greuel’s audit revealed:

  1. The city did not have any central management of cell phone contracts
  2. No one department is responsible for ensuring city policies are followed
  3. 20% of all staffers in non-revenue generating departments have a cell phone, which costs the city $4.8 million annually
  4. There was no comprehensive list of the number of cell phones issued by the city
  5. Guidelines were in place for cell phone usage, but not for which employees should get cell phones paid for by tax-payers
  6. 563 cell phones in the seven departments had not been used for two to three consecutive months, which cost the city about $46,000 per month

The audit also included 13 recommendations including, new rules for assigning cell phones and giving employees only a set number of minutes or text-messages per months.  In addition, Greuel indicates that contracts needed to be periodically evaluated.  This audit, and its results, should be a springboard for looking into other expenditures.

About the author

Anand Khemlani

I am a founding member of Fulcrum Inquiry, an accounting and economic consulting firm that performs damage analysis for commercial litigation, forensic accountings, financial investigations, and business valuations. I am a Certified Public Accountant (CPA), Accredited in Business Valuation (ABV), a Certified Fraud Examiner (CFE) and am a licensed Real Estate Broker. I regularly serve as an expert witness involving results of my forensic accounting assignments and damage analyses. My resume is available on Fulcrum's website

Permanent link to this article: http://betweenthenumbers.net/2011/05/city-of-los-angeles-wastes-1m-on-cell-phones/

1 comment

  1. Ashleigh

    Awesome blog post, good webpage design and style, carry on the great work

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