REPORT OF AUDIT, EXECUTIVE DINING ROOM, FOR THE PERIOD 1 JANUARY 1978 - 30 NOVEMBER 1979

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83-00957R000100040014-9
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 9
• Document Creation Date: December 19, 2016
• Document Release Date: May 16, 2006
• Sequence Number: 14
• Publication Date: February 21, 1980
• Content Type: MF

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2 1 FEB 1980
MEMORANDUM FOR: Director of Logistics
STATINTL VIA: Inspector General
FROM:
Chief, Audit Staff
SUBJECT: Report of Audit, Executive Dining Room,
For the Period 1 January 1978 -
30 November 1979
1. Subject report is attached. Please advise me
of the action taken on recommendations made in the report.
2. We appreciate the cooperation and assistance
furnished our representatives during the audit.
Attachment:
As stated
Distribution:
Orig. - D/LOG
1 - DDA
1 - ODPin
C} I/ Pages 1 and 3 -
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REPORT OF AUDIT
Executive. Dining Room
For the Period
I .January 1978 - 30 November 197.9
SUMMARY AND SCOPE
1. Administrative controls', procedures and records
were generally effective and in accordance with applicable
requirements. Minor administrative matters were discussed
and resolved satisfactorily during the audit. Recommenda-
tions concerning the Executive Dining Room's (EDR) new
automated accounts receivable system are discussed in
the audit comments section of this report:
2. We have examined the statement of financial posi-
tion of EDR at 30 November 1979 and the related statements
of operations and changes in financial position for the
twenty-three month period then ended. Our examination
was made in accordance with generally accepted auditing
standards and accordingly included such tests of the
accounting records and such other auditing procedures,
including a review of the automated accounts receivable
system, as we. considered n.ecessary.under the circumstances.
OPINION ON FINANCIAL STATEMENTS
3. In.our opinion the accompanying financial state-
ments, Exhibits A,.B and C, present fairly the financial
position of EDR at 30 November 1979 and the results of
operations and changes in financial position for the
23 months then ended in conformity with generally accepted
accounting principles applied on a consistent basis.
BACKGROUND
4. EDR provides a private dining,area for senior
Agency officials.where classified discussions may be
held. EDR also caters official and nonofficial Agency
functions. The Office of Logistics/Logistics Services
Division maintains responsibility for the operation of
EDR, its funds and its personnel.' A cleared manager,
who is an independent contractor, and 8.staff employees
operate the EDR.
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AUDIT COMMENTS
Executive Dining Room System (EDR)
S. The EDR utilizes the Agency's Virtual Machine
(VM) system to update, compute finance charges, and
generate billings for each EDR member's account. Much
of the manual posting and paperwork required in the
past.has been significantly reduced. This in-house
system has replaced the original manual/partially auto-
mated system provided by an external software service
bureau.
Documenting Application Changes
6. Requests for program changes, as well as the
resultant changes themselves, have not been documented.
The norm has been to process change requests via the
telephone.
7. Documentation of program changes is required to:
a. determine the impact of a change on
the rest of the program,
b. assist the follow-on and secondary
programmers to review what has been
accomplished when the primary pro-
grammer is not available, and
c. show when and why a change was made.
Recommendation #1: Document all future
program change requests and actions.
Controlling Application Programs Via PANVALET
8. The Office of Data Processing (ODP) has a system
called PANVALET which serves an independent librarian
function. Programs are submitted to PANVALET by the
various offices utilizing the library function. All such
changes require documentation (via "Program Information
Record" Form 3716) prior to re-installation. PANVALET
also has programming and documentation standards which
programmers must follow.
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9. As the system now in use operates, the system
programmer has unrestricted access to all EDR programs.
This significantly weakens internal controls. Ideally,
once a system has been designed and tested, the programmer
should not have control.of the programs, and should be
required to coordinate any future changes with the users.
10. We believe the EDR would benefit by including
its programs in the PANVALET system. This would provide
the following advantages:
restrict unauthorized access,
- require documentation on all program
changes,
- maintain the current program and a
three generation back-up of past
versions,
- improve machine throughput by making
the compiling step unnecessary,
- prevent accidental destruction of
system programs, and
- eliminate the need to store system
programs on the user's mini-disk.
Recommendation #2: Transfer control of
the EDR system programs from OF/P$SS
to ODP's PANVALET.
Reducing the Use of Computer Resources
11. EDR has been assigned 10 cylinders of mini-disk
storage and exclusive use of a Delta Data Terminal, and
uses 1,000,000 bytes of VM system core storage for pro-
cessing. It appears that the amount of computer resources
allocated and consumed by EDR can be reduced.
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12. An examination of EDR's mini-disk files dis-
closed various outdated BASIC programs and several months
of accounts receivable that need not be retained. The
BASIC programs were for use with the first version of
EDR's accounts receivable system and are no longer required,
that system having been superseded.
13. Furthermore, the on-line retention of each
day's account receivable activity beyond two months is
unnecessary for member query and audit purposes. Each
account receivable transaction is also on hardcopy print-
out retained by EDR. These daily accounts receivable
transactions are printed out as a result of the daily
update and provide sufficient data for answering
questions by members and providing the history required
for audit.
Recommendation #3: Purge files no
longer needed on EDR's mini-disk.
14. EDR has exclusive use of a Delta Data terminal.
This terminal is used for the input of meal transactions,
querying account status for members, and the input of
monthly payments. The majority of the usage involves
the input of meal transactions, which takes approximately
one half hour a day.
15. An ODP "Terminal Usage Report" shows a 21%
utilization rate for the EDR terminal during the fourth
quarter CY 1979, which indicates that EDR should consider
sharing its terminal with other nearby users, especially
considering that terminals are presently in short supply
Agency-wide. If fuller utilization of the terminal
cannot be realized or conveniently scheduled, as an
alternative EDR could release its terminal and request
scheduled time from other existing terminal users,
such as the Headquarters Engineering Branch (HEB/OL)
located in the adjacent office. HEB's utilization rate
for the same period was 11%, which indicates that both
offices could accomplish their work sharing one terminal.
Recommendation #4: Consider sharing EDR's
terminal with other users or relinquish the
terminal and obtain scheduled time from
nearby users.
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Executive Dining Room
Statement of Financial Position
30 November 1979
ASSETS
Cash on Hand $ 200
Cash in Bank 12,563'
Accounts Receivable 9,301
Food and Commodity Inventory 6,782
Furniture and Equipment $25,339
Less: Accumulated Depreciation 25,339 -0-
Total Assets $28,846
LIABILITIES AND FUND BALANCE
Accounts Payable $ 9,396
Fund Balance a/ 19,450
Total Liabilities and Fund Balance $28,846
a/ Fund Balance at 1 January 1978
$18,661
Add: Net Income (Exhibit B) 789
Fund Balance at 30 November 1979 $19,450
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Executive Dining Room
Statement of Income and Expense
1 January 1978 - 30 November, 1979
Meals
$103,917
Special Functions-
48,401
Meals Surcharge - 10%
10,634
Coffee Sales
9,551
Miscellaneous
581
Finance Charges on Overdue Accounts
414
$173,498
Expense:.
Cost of Food and Commodities
Opening Inventory
$ 5,358
Purchases
130,580
135,938
Less: Closing Inventory
6,782
$129,156
Special Function Overtime
19,524
Equipment Purchases
3,215
Miscellaneous Supplies and Services
10,194
Laundry
9,402
Clothing Maintenance Allowance
770
Equipment Repairs
448
172,709
Net Income (Exhibit A)
$ 789
Salary Costs Paid by the Agency:
$296,275
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Executive Dining Room
Statement of Changes in Financial Position
1 January 1978 - 30 November 1979
Resources Provided from Operations:
Net Income $ 789
Increase in Working Capital $ 789
Increase (Decrease) in Current Assets:
Cash in Bank - Checking $(2,664)
Accounts Receivable 1,956
Inventory 1,424
Total Increase in Current Assets $ 716
Decrease in Current Liabilities:
Accounts Payable $ 73
Total Decrease in Current Liabilities $ 73
Increase in Working Capital (Exhibit A) $ 789
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