State auditor strives for relevancy

As your state auditor, I promised to provide you regular updates on the steps and progress we are making to restore the auditor’s office to relevancy.  Simply, the auditor’s office’s mission is to combat fraud, waste and abuse in state government and ensure taxpayer dollars are spent as intended.  

Earlier this year, I decided to audit the auditors office.  Why?  Because as the first new auditor after 30 years, I believed that it was important to bring in outside professionals with the ability to offer their perspective and constructive observations to improve this office for Delaware taxpayers.

I contracted with a private firm, which has never done business with this office, to bring an independent eye to the auditors office.

As part of this audit, the firm reviewed and evaluated past practices, examined the many initiatives I undertook during my first 100 days in office, and looked at other state auditors offices to see how we compare.  

The Auditing the Auditor’s Office report presented observations and gaps on all facets of how the office operated before the start of my administration in January.  The report offered 58 recommendations to restore the auditor’s office in areas ranging from office workflow, to professional development, to how bids are scored and much more. 

Right now, we are in the process of closing one critical gap that caught my attention: 

Along with the auditor’s office not fulfilling many of its statutory mandates was the fact that the office lacked processes or methodologies to determine when to perform any audits.  The report noted: 

It is generally considered a best practice for an auditor to perform a risk assessment of an organization in order to prioritize resources when drawing up an audit plan/schedule for the next year(s) audit plan.  We determined that other state auditors take a risk-based approach when determining the non-mandated audits to identify the areas with the highest risks and to perform more audits that add more value for taxpayers’ money.

When you combine this lack of processes with the fact that the auditor’s office continues to operate at Fiscal Year 2008 funding and staffing levels, ensuring an objective process exists to decide where to allocate scarce resources becomes critical so the office can function efficiently and effectively.

For the first time, the auditor’s office is creating a comprehensive risk assessment to use to develop the office’s annual audit plan.  The audit plan is an evergreen document that serves as a roadmap for the office in accomplishing its work.  This customized and proprietary risk assessment is composed of a number of different data and information sources.  

In my opinion, some of the most important information will come from a survey sent to state employees.  With their input, we will have information that will assist us in executing an audit plan that incorporates assessing risk, targeting critical areas of state expenditures and providing maximum impact for the state.

As an independently elected office - accountable to all Delaware taxpayers - with new staff and a new structure, this office has accomplished much and made huge strides since January.  

Transforming the auditor’s office is vital.  It needs to operate at a higher level because its roles and responsibilities factor greatly into maintaining Delaware’s fiscal health and giving Delawareans confidence that their tax dollars are being spent properly.  

As we move forward, please know that I will continue to share with you our progress to make this office relevant again.

Kathy McGuiness
state auditor