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

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 10 calls There are some days that we respond to four 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 And there are some days that we do not get any calls for the Hotline

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

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

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? 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?

The Screen Out Process The DSIA uses two screening processes to determines if the call falls within the scope of the Hotline Policy 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 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 Each Hotline call that is assigned a case number goes through a second screening process

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

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

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

The Caller (continued) Some callers are reporting the allegation to us as second hand information 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 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 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 Some callers report more than one allegation

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

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

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

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

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

Cases Assigned by Category Category FY 2009 FY 2008 FY 2007 Abuse Waste Fraud Personnel01920 Other01347 Total

Cases Assigned by Type Type FY 2009 FY2008 FY 2007 Misuse of State Vehicle Leave Abuse Improper Hiring -39- Non-compliance with agency internal policy Employee Misconduct Poor Management --44 Misuse of State Equip All Other Types Total

Cases Substantiated by Category Category FY 2009 FY 2008 FY 2007 Abuse Waste Fraud Personnel6418 Other1414 Total

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

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

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

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

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 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 The agency does not have an IA Department or Hotline Coordinator

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

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

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

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

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

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 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 request a response to our audit report We evaluate the appropriateness of the response to our report We evaluate the appropriateness of the response to our report

The Audit Report Our audit report contains: Our audit report contains: The Scope of the InvestigationThe Scope of the Investigation The Allegation(s)The Allegation(s) The Finding of FactThe Finding of Fact The ConclusionThe Conclusion RecommendationsRecommendations

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

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

Cases Assigned and Closed by DSIA Fiscal Year Open Cases Beginning of Year Cases Assigned Cases Closed Open Cases End of Year FY FY FY Total111121

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

Questions