Audit Case Study Synopsis™ (11479)

Project
Denver, CO

Industry
Energy

Savings (total)
$1,744,385
Savings (square foot)
$10.93

Audit Accuracy™
97.40%
Audit Timeline™
168 days
Audit Timespan™
112 days
Audit Return™
$10.93

Campaign Commencement
Q4 2008
Representation Type
Exclusive Service Provider
Campaign Scope
Global Portfolio
Audit Cycles
Annual-Recurring

RRG’s audit covered four (4) operating years and an ownership entity who had failed to reconcile the building costs for two (2) years.

Following the fieldwork visit and interviews with the property manager and asset manager, it was determined that the landlord was passing through all costs associated with its corporate operation. RRG supported that the landlord had improperly included various administrative expenses such as corporate travel for executives, leasing expenses and tenant parties in the operating expenses for the building. Furthermore, RRG’s review of the general ledgers and invoice support confirmed that the client was not credited the entire amount of operating expense and real estate tax estimates it had paid for the most recent two (2) year period. The landlord had not applied the last four (4) months from the prior year and the first four (4) months from the current year even though the general ledgers reflected the payments were made and classified correctly. It was confirmed and agreed by the landlord that the estimates payments had not transitioned to and were not reflected accurately on the reconciliation statements that were generated and issued.

Following the completion of discussions with the tax assessor and other taxing authority representatives, RRG was able to confirm the date the tax refunds were released to the landlord. The dates provided did not correlate to any of the documentation reviewed over the course of the audit. During the negotiation the landlord confirmed that they had indeed received the tax refunds during the periods outlined by the taxing authority, but had failed to apply the appropriate credits to the subject building. Additionally, the lease also limited any tax consulting fees paid by the landlord by applying a cap to such costs. The audit confirmed that no cap had ever been applied to these charges which were adjusted through the audit as well.

Management Fee
Tax Consultant Fees
Landlord Overhead
Estimate Payments
Refund Chargeback
Tax Refund

 
 

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