Internal audit delivers service and technological efficiencies for generation and distribution utility

Client need

A $75 million generation and distribution utility struggled with inefficient business processes that affected its service delivery and use of technology. Faced with needing to improve its operations, financial and technology practices but not having its own internal audit function, the organization needed to secure outside internal audit services.

Baker Tilly solution

Baker Tilly energy and utilities specialists were secured to conduct the utility’s internal audit function. This one-time project which involved four phases.

Phase One evaluated business processes in these key areas and made recommendations for changes to meet optimum practices:

Operations
  • Meter reading
  • Service orders
  • Capital and operational budgeting
  • Crew scheduling
  • Work order construction process
  • Customer service
  • Materials management
Financial
  • Purchasing
  • Accounts payable
  • Cash management and accounts receivable
  • Payroll
  • Work order closing
  • Fixed asset accounting
  • Financial reporting
Technology
  • Technology governance
  • Use of current systems
  • Gap analysis between current and future state processes
  • Technology controls
  • Use of technology in operations, finance and customer service

Phase Two of the utility’s outside internal audit function included writing policies and procedures for each key business area based on the analysis of current processes and recommendations for improvements.

Phase Three involved holding workshops and training sessions for utility personnel in each key area on the new processes.

Phase Four encompassed a six-month review with utility staff to determine if the new processes were being used and were effective. Further recommendations came out of the Phase Four review.

Results

By seeking outside internal audit support for this one-time need, the generation and distribution utility benefited from Baker Tilly’s deep utility industry experience and knowledge of issues faced by peer utilities as well as an independent review. The utility received recommendations for optimal industry practices at a fixed project price without having to add to its long-term base cost structure for personnel and benefits.

For more information on this topic, or to learn how Baker Tilly energy and utility specialists can help, contact our team.