Auditors
of Public Accounts
At a Glance
ROBERT G. JAEKLE and KEVIN P. JOHNSTON, State Auditors
Average Number of full-time employees – 106
Recurring operating expenses –
$9,209,000
Capital outlay – $48,000
The mission of the Auditors of Public Accounts
is to:
·
Determine
whether state agencies and quasi-public agencies complied with applicable state
and federal legal requirements
·
Determine
whether state resources are properly and prudently safeguarded and used
·
Attest to
the fairness of the state’s financial statements and provide a certification
thereto
·
Perform the
annual Statewide Single Audit required by the federal government
·
Evaluate
the state agencies’ economy, efficiency and effectiveness in using available
resources
·
Evaluate
program results considering costs and benefits
·
Ensure that
all audit results are properly disclosed to management and the public
·
Investigate
whistleblower matters
The Auditors
of Public Accounts operate under provisions contained in Sections 2-89 through
2-92 of the General Statutes. As
provided for in Section 2-90 of the General Statutes, this Office is charged with the
responsibility of auditing the books and accounts of each officer, department,
commission, board, and court, of the state government, as well as all
state-aided institutions and certain quasi-public agencies created by act of
the General Assembly. In addition, under
Section 4-61dd of the General Statutes this Office is responsible for reviewing
all whistleblower complaints filed against the state and reporting the results
of our reviews to the Attorney General.
Finally, Section 1-122 of the General Statutes requires our Office to
conduct annual compliance audits of certain quasi-public agencies.
In
accordance with this Office’s statutory authority, it is the goal of the
Auditors of Public Accounts to serve the public interest regarding fiscal and
compliance matters related to the State of
Public Service
Recommendations included in reports most frequently lead to benefits
that cannot be quantified, such as new internal controls and management
procedures put into place as a result of our audits. The benefits resulting from these
improvements may be far more significant than any quantifiable savings that are
identified. Nonetheless, some of our
recommendations lead to documented cost savings or increased revenues. For example, during a recent audit of the
State Insurance and Risk Management Board we recommended that the Board recover
contingent commissions earned by the State’s Agent of Record after finding that
the Agent did not reduce its brokerage fee billings for contingent commissions
it received from insurers as required by its contract with the Board. This finding ultimately resulted in a
settlement with the Agent whereby the State recovered some $755,000 in
insurance overpayments.
In addition,
our Office maintains its own website (http://www.state.ct.us/apa). A key feature of this website is that it
provides for the electronic distribution of our audit reports via the
Internet. Accordingly, members of the
public and other interested parties with Internet access may download, for
viewing and/or printing, copies of all audit reports issued by our Office. General information about the operations of
our Office can also be found on this website.
It should be noted that further utilization of Internet technology by
our Office is planned during the coming year.
Improvements/Achievements 2005-06
The work of this Office is evaluated annually
by representatives of the various Federal Inspectors General’s Offices and,
every three years by an independent accounting firm. The latest such independent accountant review,
conducted in the Spring of 2006, commonly referred to as a peer review,
resulted in a very favorable unqualified opinion of the Office’s system of
quality control to ensure conformance with professional standards.
Our Higher Education audit group continues
to provide audit certification to financial statements of the
Section
3-37, subsection (a), of the General Statutes requires the State Treasurer to
submit a final audited report to the Governor and the Investment Advisory
Council on or before October 15th of each year.
We continue to provide our certification of the Treasurer’s Annual
Report on this very short timetable. In addition, in connection with our audits
of the Offices of the State Comptroller and State Treasurer, we are continuing
to provide special audit services in connection with the Comprehensive Annual
Financial Report, the Combined Investment Funds and the Short-Term Investment
Fund. Other requests for audit services
continue to be met in a professional and timely manner without the need for
outside professional assistance. For
example, the Department of Children and Families, after being informed of
transaction irregularities in the Department’s Adolescent Services Unit,
requested that our Office conduct a special review of this Unit. Our report on that review, which contained
six recommendations, was issued on October 6, 2005.
In recent
years, our staff has increased the use of Computer Assisted Audit Tools (CAATS)
because of the increasing predominance of large and complicated computerized
systems. This technology can be used to
increase productivity, improve audit effectiveness and efficiency, and reduce
dependence on agency EDP personnel. CAATS has been used by our staff in
performing various audit procedures including: data analysis, tests of details
of transactions, tests of balances and compliance tests of information systems
’general controls.
During the
past three years this Office also spent a great deal of time and resources
familiarizing its professional audit staff and business office staff with the
new core financial and human resource management systems, which were
implemented by the state during the 2003-2004 fiscal year. These new systems are collectively referred
to as “Core-CT”. The financial system became operational on July 8, 2003, while
the human resource system came on line on October 28, 2003. Extensive training in the use of these
systems was provided to all staff members during this past three years. The challenge during the 2004-2005 and
continuing into the 2005-2006 fiscal year was to audit, for the first time,
financial statements of the State of Connecticut that were prepared utilizing
financial data captured on the state’s new Core-CT accounting system. Because of problems the State Comptroller has
encountered with this new accounting system, however, preparation of the
state’s financial statements for the fiscal year ended June 30, 2004, was
delayed, resulting in final audited financial statements for this period not
being published until December 30, 2005.
With regard to our audit of the state’s financial statements for the
fiscal year ended June 30, 2005, it is anticipated that, because continued
delays on the part of the State Comptroller’s Office in preparing the state’s
financial statements, our audit of these financial statements for the fiscal
year ended June 30, 2005, will not be completed until September 30, 2006.
In order
for this Office to better meet the audit challenges presented by the state’s
aforementioned implementation of the Core-CT computer system, this Office
decided to expand the staffing of our Information Systems Audit Unit. This has allowed the Unit to not only fulfill
its normal audit function, but to also serve as a source of technical,
educational, and training support for our staff on various Core-CT
implementation issues that have arisen.
This Office in all staff appointments,
promotions and training observes the principles of equal employment
opportunity. To this end our
professional auditing staff has been and will continue to be hired and promoted
through a competitive selection process.
Information Reported as
Required by State Statute
Sections
2-90, 2-92, and 4-61dd contain the various reporting requirements applicable to
the Auditors of Public Accounts. A
description of the reports issued by our Office pursuant to these provisions is
described below:
Although
financial-compliance auditing continues to be the principal responsibility of
this Office, the mission of the Auditors’ Office also includes an examination
of performance in order to determine the effectiveness of an agency or a
specific state program in achieving its expressed legislative purpose. Our established Performance Audit Unit, when
not responding to special requests for assistance or conducting high priority
special reviews, devotes time to performance auditing, usually focusing on a
particular program administered by a state agency or agencies. During the 2005-2006 fiscal year a performance audit report on select operations of the
Department of Revenue Services was issued.
In addition, there were five reviews of a performance area included in
regular agency audit reports.
During
the 2005-2006 fiscal year the Office issued 43 audit
reports and special reports. These
included two special audits, 40 financial-compliance audits of various state
agencies, and our annual report to the General Assembly. The Statewide Single Audit Report for the
State of Connecticut for the fiscal year ended June 30, 2005, which would
normally be issued by March 31, 2006, has been delayed an additional six months
in order to provide the State Comptroller extra time to prepare the state’s
financial statements utilizing financial data captured on the state’s new
Core-CT accounting system. It should be
noted that this latter audit is required as a condition of the state receiving
almost $5,500,000,000 in federal financial assistance.
A total of
279 recommendations were included in the 43 audit reports and special reports
issued during the year. These reports
also included a review of the implementation of recommendations made in the
prior audits of the agencies audited during 2005-2006. Implementation follow-up procedures, in
addition to agency responses to the Auditors’ audit findings and
recommendations, include reviews by the Comptroller’s Office, the Office of
Policy and Management and the Legislative Program Review and Investigations
Committee. For reports issued during the
2005-2006 fiscal year, agencies implemented or otherwise resolved 48 percent of
all prior audit recommendations.
During the
2005-2006 fiscal year our Office received 109
whistleblower complaints, which represents more complaints than our Office
normally receives during a given fiscal year.
Despite this higher than average volume, assistance continued to be rendered
to members of the General Assembly as requested by them.