Office of the Legislative Auditor - Financial Audit Division

Report Summary

Minnesota Zoological Garden

July 1, 1998, through June 30, 2001

The Minnesota Zoological Garden (Zoo) collected and appropriately deposited the revenues generated from enterprise activities. The Zoo provided reasonable assurance that revenues were adequately safeguarded and that revenue, payroll, and administrative expenditure transactions were properly recorded on the state's accounting system.

Key Findings and Recommendations

• The Zoo did not follow proper contracting procedures when administering the construction contract for a heating system project. We recommended that the Zoo approve construction supplemental agreements only in cases where there is a documented change in the scope of the project work. It also should request performance bonds as part of all construction project requests for bids.
• The statutory requirements for the Zoo's contracting process are unclear. We recommended that the Zoo work with the Department of Administration to more clearly define which services the Zoo can contract for under Minn. Stat. Section [2001] 85A.02, Subd. 3. For all other contracting, the Zoo should obtain the necessary approvals from the Department of Administration, when required, or should receive a formal delegation from the commissioner of Administration to allow the Zoo to approve its own contracts.
• The Zoo did not always clearly define the contractor's work products before work began. In addition, the Zoo did not always pay contractors in accordance with the signed contract. We recommended that the Zoo require formal written contracts before contractors are allowed to begin working. In addition, the Zoo should require standardized contracts that contain all necessary provisions and should monitor compliance with all contract terms.
• Some travel expense reimbursement claims did not comply with applicable policies and regulations. We recommended that the Zoo implement effective internal controls over employee travel expenses.

The Minnesota Zoological Garden, which opened in 1978, is located in Apple Valley, Minnesota. It was established pursuant to Minn. Stat. Chapter 85A as “a partnership between the private sector and the state.” The State Zoological Board manages and controls the Zoo. The board consists of 30 public and private sector members. The Governor and the Zoological Board each appoint 15 members. The board is responsible for appointing a director who serves as the chief administrative officer of the Zoo.

Financial Audit Reports address internal control weaknesses and noncompliance issues found during our audits of state departments and agencies. The agency's response is included in the report.