A Day in the Life of an Auditor at the Division of State Internal Audit

1. A Day in the Life of an Auditor at the Division of State Internal Audit The State Employee Fraud, Waste, and Abuse Hotline

2. How many calls do we answer in a typical day? • There are some days that we respond to 10 calls • There are some days that we respond to four calls • And there are some days that we do not get any calls for the Hotline

3. Calls to the Hotline • Are all calls to report allegations of fraud, waste, and abuse? • No, some calls are just to find out how the Hotline works • Some are to check on the status of an investigation • Some are to provide additional information to an original call • And some are to check to see if the investigator has any questions for the caller

4. The DSIA Auditors • We are auditors, too! • We have the same experience, skills, and certifications as agency auditors • When investigations involve agency heads or other auditors we will perform the investigation • We will write and issue the investigative report

5. The Call to the Hotline • Thank you for calling the State Employee Fraud, Waste, and Abuse Hotline, please do not disclose your identity, are you calling back about a case that you have previously reported?

6. The Screen Out Process • The DSIA uses two screening processes to determines if the call falls within the scope of the Hotline Policy • The first screen out process determines if the allegation is for an executive branch agency, or if the caller should be directed to another agency for assistance • Each Hotline call that is assigned a case number goes through a second screening process

7. The Second Screen Out Process • How material are the allegations? • How timely are the allegations? • Did the caller provide enough detail to perform an investigation?

8. Gathering the Information • Its our job to obtain as much detailed information as possible from the caller about the allegation • This can, at times, be very difficult • We try to put the caller at ease

9. The Caller • Many of the callers are fearful about calling the Hotline • Many callers are fearful that they will not remain anonymous • Many callers are fearful of retaliation from their agency • The identity of the caller is anonymous and the information they provide is kept confidential

10. The Caller (continued) • Some callers are reporting the allegation to us as second hand information • Some callers don’t have all the facts about the allegation when they call • We have to ask open-ended questions to get the callers to give us information about the allegation • Some callers report more than one allegation

11. The Caller (continued) • Some callers will send us their allegations by mail, email, or fax • Many callers will broadly state that everyone knows what is going on • Unfortunately, often when employees are interviewed, the information provided is of little help

12. The Caller (continued) • We ask for the names of witnesses • Some callers will provide the names of witnesses • Sometimes the witnesses have some information which is helpful • Sometimes the witnesses do not have any useful information

13. Hotline Statistics FY 2009 • Total cases assigned during fiscal year 2009 were 612 • 499 cases were closed • 39% of the Hotline cases investigated were substantiated

14. Hotline Statistics (continued) • 13% of the Hotline cases were unsubstantiated but improvements in controls were made • 43% were unsubstantiated • 9% were referred to others.

15. Common Allegations • State vehicle abuse: 62 cases • Abuse of the State’s leave policy:68 cases • Unnecessary purchases: 40 cases

16. Cases Assigned by Category

17. Cases Assigned by Type

18. Cases Substantiated by Category

19. Documenting the Allegation • We write up the allegation in a clear and concise format for the Agency auditor to investigate • Sometimes, depending on the allegation and or the Agency, we may do some preliminary research to assist the agency auditor

20. Documenting the Allegation (continued) • We make and mail a copy of the allegation write-up to the Agency Internal Audit Director • We keep the original write-up in the DSIA Hotline files • We enter the Hotline case information into the DSIA database

21. Documenting the Allegation (continued) • The agency is given 60 days to complete its investigation • The agency provides a written report to the DSIA • We review the Agency Internal Auditor’s investigative report to ensure that it adequately addresses the allegations • We close the case in the DSIA database

22. When the DSIA Performs the Investigation • The allegations involve the Agency Head • The allegations involve a Secretary in the Governor’s Cabinet • The allegations involve the agency Internal Audit Department (IA)

23. When the DSIA Performs the Investigation (continued) • There may be an appearance of a conflict of interest if the agency IA Department performs the investigation • The agency does not have an IA Department or Hotline Coordinator

24. When the DSIA Performs the Investigation (continued) • We have many of the same audit certifications that agency Internal Auditors have • We follow the same audit procedures and investigative techniques as agency Internal Auditors do • We develop an audit planning document

25. When the DSIA Performs the Investigation (continued) • We gather data and evidence • We interview witnesses • We interview the subject(s) • We document our findings in our work papers • We analyze our findings

26. When the DSIA Performs the Investigation (continued) • We review our findings with the Audit Manager • We make recommendations for corrective action to the agency • Our work papers are confidential

27. DSIA Resources • Department of Human Resource Management • Commonwealth Accounting Policies and Procedures Manual (CAPP Manual) • Payline • Personnel Management Information System (PMIS) • The Internet

28. DSIA Resources (continued) • The Commonwealth Accounting and Reporting System (CARS) • The Small Purchase Charge Card detail • The Reid Interview Technique

29. Reporting • We write an audit report that will be issued to an Agency Head, a Governor’s Cabinet Secretary, and/or to the Governor’s Chief of Staff • We request a response to our audit report • We evaluate the appropriateness of the response to our report

30. The Audit Report • Our audit report contains: • The Scope of the Investigation • The Allegation(s) • The Finding of Fact • The Conclusion • Recommendations

31. DSIA Statistical Data • Information regarding each Hotline case is entered into our DSIA database • The information in our database can be queried in many ways • We issue monthly internal reports of Hotline statistics

32. DSIA Statistical Data (continued) • Quarterly, Hotline status reports are requested from Agency Auditors on cases older than 60 days • Annually, a Hotline statistical report is issued to the State Comptroller, the Secretary of Finance, and the Governor’s Chief of Staff

33. Cases Assigned and Closed by DSIA

34. Cases Assigned and Closed by DSIA Fifty-two cases were closed during 2009, an increase of 4 from 2008: • Twenty-seven (52% of closed cases) involved substantiated allegations • Six (11% of closed cases) involved unsubstantiated allegations but recommendations were made • Three (6% of closed cases) involved allegations that were unsubstantiated • Sixteen (31% of closed cases) were screened out • “Cases assigned” and “cases closed” include screened out cases

35. Questions