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HomeMy WebLinkAbout1718-1 2017 Global follow-up report (FINAL 11-3-17)2017 Global Follow-up report #17/18-1 November 2017 2017 GLOBAL FOLLOW-UP REPORT Outstanding recommendations – Additional wage payments, Health Services, WEBCO, Community Development, Health benefits trust, Human Resources, Light Fleet, Law Library, Property & Facilities, Selected electronic communications, and Solid Waste To request this information in an alternate format, please call (541) 330-4674 or send email to David.Givans@Deschutes.org Deschutes County, Oregon David Givans, CPA, CIA, CGMA Deschutes County Internal Auditor PO Box 6005 1300 NW Wall St, Suite 200 Bend, OR 97708-6005 (541) 330-4674 David.Givans@Deschutes.org Audit committee members: Lindsey Lombard, Chair - Public member John Barnett - Public member Tom Linhares - Public member Daryl Parrish - Public member Wayne Yeatman - Public member Anthony DeBone, County Commissioner Nancy Blankenship, County Clerk Dan Despotopulos, Fair & Expo Director 2017 Global Follow-up report #17/18-1 November 2017 TABLE OF CONTENTS: 1. INTRODUCTION 1.1. Background ………………………………………...………………………........ 1 1.2. Objectives & Scope ……………………………………..…………………….… 1 1.3. Methodology …………………………………………………………..….…… 1-2 2. FOLLOW-UP RESULTS ………………………………………………....….... 3-6 APPENDIX I – Updated workplan for identified outstanding recommendations (Status as of October 2017) …….…….…….…………………......... 7-18 2017 Global Follow-up report #17/18-1 November 2017 Page 1 1. Introduction 1.1 BACKGROUND Audit Authority: The Deschutes County Audit Committee has suggested that follow-ups occur within nine months of the reports. The Audit Committee’s would like to make sure departments satisfactorily address prior recommendations that have not been completed at the time of the initial or subsequent follow-ups. This is the eighth annual global follow-up looking back to unresolved recommendations in prior follow-ups. 1.2 OBJECTIVES and SCOPE Objectives: The objective was to follow-up on previously incomplete recommendations. Scope: This 2017 Global follow-up included reports with incomplete recommendations that did not have a follow-up report completed in approximately a year. The audit reports in TABLE I were covered in this report. There were forty-seven recommendations included in this follow-up (as compared to forty-three in the prior year). Status was determined through information provided by departments from September 2017 – October 2017. The original internal reports should be referenced for the full text of recommendations and associated discussion. All internal audit performance reports are published on the County website at https://www.deschutes.org/administration/page/internal-audit-reports 1.3 METHODOLOGY The follow-up report was developed from information provided by appropriate staff in the associated departments. In cases where recommendations have not been implemented, comments were sought for the reasons why and the timing for addressing these. The follow-ups are, by nature, subjective. In determining the status of recommendations that were followed up, we relied on assertions provided by those involved and did not attempt to independently verify those assertions. It is understandable that some of these recommendations will take more than one year to be completed. Departments should be acknowledged for the work and commitment to address the recommendations. 2017 Global Follow-up report #17/18-1 November 2017 Page 2 TABLE I Reports and number of recommendation s included in follow-up {Reports hyperlinked } Since no substantive audit work was performed, Government Auditing Standards issued by the Comptroller General of the United States were not followed. Department/ Area Original Report # Date Report Issued Last Follow- up Report Last Follow-up Date # of Original Recommendations # Recommendations in this follow-up % of Original Additional wage payments 12/13-2 May-13 16/17-1 Nov-16 4 2 50% Community Development 06/07-7 Jan-08 16/17-1 Nov-16 11 1 9% Health Benefits Trust 12/13-11 Oct-13 16/17-1 Nov-16 7 4 57% Health Services 04/05-6 Mar-05 16/17-1 Nov-16 52 2 4% Health Services 13/14-3 May-14 16/17-1 Nov-16 9 1 11% Health Services- Webco (NEW) 15/16-4 Feb-16 16/17-2 Dec-16 18 7 39% Human Resources 08/09-16 Jan-10 16/17-1 Nov-16 26 4 15% Law Library (NEW) 15/16-5 May-16 16/17-4 Feb-17 6 1 17% Light Fleet (NEW) 14/15-10 Jun-15 15/16-10 Apr-16 14 14 100% Property & Facilities 11/12-12 Sep-12 16/17-1 Nov-16 5 1 20% Selected electronic communications (NEW) 13/14-4 Aug-14 16/17-1 Nov-16 13 9 69% Solid Waste 03/04-1 Aug-03 16/17-1 Nov-16 34 1 3% Totals 199 47 24% 2017 Global Follow-up report #17/18-1 November 2017 Page 3 2. Follow-up Results Figure I - How were recommendations implemented? The follow-up included forty-seven (47) recommendations made over twelve internal audit reports. The number of recommendations followed up on was slightly up from 2016. The number of outstanding recommendations represented twenty-four percent (24%) of the original recommendations (as compared to 22% in 2016). For some of the reports, a couple of follow-ups have occurred. There were four new audits included in this follow-up with thirty-one outstanding recommendations. The follow-up indicates fifteen (15) of these outstanding recommendations (or 32%) have been completed. Implementation is expected to take time for some recommendations, but the idea would be to have these incomplete recommendations resolved as soon as practicable. Figure I provides a summary of the change in status for these followed up recommendations. Thirty-two percent (32%) of the reviewed outstanding recommendations are completed. This compares with forty-two percent (42%) in 2016. A detailed listing of all of the recommendations followed up on and their status is included at the end of the report in Appendix I. In interpreting the status, the County Internal Auditor may sometimes raise or lower the status provided by the department based on the communication(s) received from the department. Completed 32% Planned 8% Underway 60% 2017 Global Follow-up report #17/18-1 November 2017 Page 4 Figure II - How were recommendations implemented by department and report? Figure II provides a breakdown of the status of these recommendations by department and audit report. Generally, there is a natural progression seen as “planned” implementation moves into an “underway” status and then to “complete”. 2017 Global Follow-up report #17/18-1 November 2017 Page 5 Figure III - How has the status changed for outstanding recom- mendations? Figure III indicates the beginning status of recommendations coming into this follow-up and whether they have moved from one category to another. Lack of movement does not necessarily mean that no work was performed, but that it hasn’t moved from one category to another. Figure III was designed to identify movement in recommendations. 2017 Global Follow-up report #17/18-1 November 2017 Page 6 TABLE II Reports, number of recommendations included in follow-up and percentage still outstanding Table II indicates for these reports 84% of the original recommendations accepted have been deemed completed. This doesn’t include all of the reports fully completed (over this period) and not part of the global follow-up. In 2016, the global follow-up completion rate was 87%. After the follow-up, only sixteen percent (16%) of the original recommendations are still outstanding (see Table II). Department/Area Original Report # # of Original Recommendations # Recommendations in this follow-up % of Original # of Recommendations still Outstanding % Outstanding Additional wage payments 12/13-2 4 2 50% - 0% Community Development 06/07-7 11 1 9% 1 9% Health benefits trust 12/13-11 7 4 57% 4 57% Health Services 04/05-6 52 2 6% - 0% Health Services 13/14-3 9 1 100% - 0% Health Services-Webco (NEW) 15/16-4 18 7 39% - 0% Human Resources 08/09-16 26 4 15% 4 15% Law Library (NEW) 15/16-5 6 1 17% - 0% Light Fleet (NEW) 14/15-10 14 14 100% 13 93% Property & Facilities 11/12-12 5 1 20% 1 20% Selected electronic communications (NEW) 13/14-4 13 9 92% 9 69% Solid Waste 03/04-1 34 1 3% - 0% Totals 199 47 24% 32 16% 2017 Global Follow-up report #17/18-1 November 2017 Page 7 APPENDIX Appendix I – Updated workplan for identifed outstanding recommendations. (status as of October 2017) Included as “completed” were statuses indicating they were complete and had some form of ongoing work; and withdrawn due to the recommendation no longer being relevant in the current environment. Items that are not complete are grayed out. Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 1 Additional wage payments 12/13-2 2 It is recommended that the Sheriff’s Office reconsider the need for the wellness program. If a need is determined, revisions to the wellness program are recommended to further the agency’s wellness goals in their workforce and provide outcomes that are measurable and can be easily documented. Underway Completed Wellness program has been removed from the collective bargaining agreement. 2 Additional wage payments 12/13-2 3 It is recommended the Sheriff’s Office consider adjusting the employee association language regarding bi-lingual pay to reflect that subsequent testing may be requested by a supervisor and or language that is similar to other County union association agreements. If no changes are made, Personnel should consider implementing an annual testing program as indicated in the union association agreement. Underway Completed Bilingual language has been changed to allow Sheriff to approve. 3 CDD 06/07-7 10 It is recommended the department consider developing a policy on the creation and use of reserves. Underway Underway Policies are complete. CDD presented a draft policy to BOCC in May 2017. There was not strong support. CDD was asked to return. CDD will schedule a work session and aim for approval to inform the FY 18-19 budget. Unknown 2017 Global Follow-up report #17/18-1 November 2017 Page 8 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 4 Health Benefits Trust 12/13- 11 1 It is recommended for management of the Plan to develop and implement a consistent approach to assessing the performance of the DOC. Underway Underway HR staff, in cooperation with Davidson Benefit Planning, is working with DOC provider to create performance reporting. This effort requires multiple data source inputs and HR has reviewed sample draft report. Aug-2018 5 Health Benefits Trust 12/13- 11 2 It is recommended for County management to develop an approach to handling Plan and DOC staffing and oversight. Underway Underway HR will work with County Administration to establish an executive oversight group for Plan administration. This will likely include the Plan Administrator, Risk Manager, HR staff, and Finance staff. Aug-2018 6 Health Benefits Trust 12/13- 11 3 It is recommended for the County to identify how to better collect information on employee DOC visits. It is suggested all employees be required to indicate on their timesheets their use of the DOC. On hold Underway HR staff, in cooperation with Davidson Benefit Planning, is working with DOC provider to create performance reporting. HR is evaluating the pros and cons of requiring DOC use to be recorded on timesheets. Aug-2018 7 Health Benefits Trust 12/13- 11 4 It is recommended, after adequate time sheet information has been collected, the County assess the cost to the County and departments for employee usage of the DOC on work time and whether they want to continue the practice at this level. On hold Underway Current timekeeping is inadequate to capture the information and lacks reporting. In anticipation of the new time keeping system, HR completed a survey on DOC policies and practices in each department. HR will use this information, along with the functionality of the new system to establish a consistent time recording practice. This, along with the new DOC reporting will help staff evaluate the DOC cost and utilization. Aug-2018 2017 Global Follow-up report #17/18-1 November 2017 Page 9 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 8 Health Services 04/05-6 4 It is recommended the Department consider requiring support for information used to establish reduced client fees. This might include income tax returns or pay stubs. On hold Completed As of 4/1/2017, the Behavioral Health Division requires proof of income for all new and existing clients. We have clear guidelines on what is to be included when considering income and what is excluded (see attached). We also update and follow the Federal Poverty Guidelines, which are released annually, in our consideration of reduced/waived fees. Public Health still does not require proof of income but it is my understanding that their primary program (reproductive health) CANNOT require it due to OAR limitations. I do not know for sure if that is accurate but that is my understanding. 9 Health Services 04/05-6 30 It is recommended for the Department to develop collection procedures identifying the extent of collection efforts. On hold Completed Behavioral Health has adopted collection processes that mimic Public Health’s. We send the same number of statements, the same letters, and have the same process for accounts that exceed 120 days with no payment or correspondence. Behavioral Health has gone an additional step in reviewing clients for potential termination from care if they do not meet medical criteria to remain in treatment and have refused to pay their bill. 2017 Global Follow-up report #17/18-1 November 2017 Page 10 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 10 Health Services 13/14-3 2 It is recommended for the department to institute sufficient controls over services to assure they are being captured and billed. To the extent needed, the department should gain a better understanding of the extent services being provided by provider. Underway Completed Ongoing controls in place: Monitoring, auditing, and training by SPP and supervisors. Supervisors receive regular reports on clinician caseloads and open encounters to follow-up with clinicians. New documentation timelines went into effect in Spring 2017 (24-48hr). Documentation procedure updated in Spring 2017. SPP is launching new dashboards for each BH program to more closely monitor services provided and give actionable data to teams and leadership 11 Health Services- Webco 15/16-4 1 It is recommended for WEBCO, with proper financial advice, develop an approach to addressing the weaknesses in developing accounting information for financial statement preparation. Underway Completed WEBCO has been disbanded 12 Health Services- Webco 15/16-4 5 It is recommended that WEBCO explore how it could accomplish and retain all accounting and reporting through one accounting system. Underway Completed WEBCO has been disbanded 13 Health Services- Webco 15/16-4 7 It is recommended that WEBCO staff document their accounting policies and procedures. These policies and procedures should be available to all employees and should include, in detail, the responsibilities of each employee. Underway Completed WEBCO has been disbanded 2017 Global Follow-up report #17/18-1 November 2017 Page 11 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 14 Health Services- Webco 15/16-4 8 It is recommended that WEBCO management develop some segregation and oversight around the billing, receivable and collection function. It is recommended for WEBCO to have an endorsement stamp to restrict deposit to their account. Underway Completed WEBCO has been disbanded 15 Health Services- Webco 15/16-4 12 It is recommended for WEBCO in coordination with the County departments determine how it can assure accountability for purchased prepaid gift cards. This could be through establishing sufficient safeguards for oversight and control of the prepaid gift cards or discontinuing this practice. Detailed receipts should be obtained for all purchases made by staff with prepaid gift cards. Underway Completed WEBCO has been disbanded 16 Health Services- Webco 15/16-4 17 It is recommended that decisions minimize the overlap of services, seek efficiencies and minimize overhead costs. This should require financial forecasts be developed for whether service payments under a revised fee structure and underlying resources (fund balances) can sustain the organization. Underway Completed WEBCO has been disbanded 17 Health Services- Webco 15/16-4 19 It is recommended that WEBCO establish distributions in their organizational documents that would allow distribution of excess reserves identified. Underway Completed WEBCO has been disbanded 2017 Global Follow-up report #17/18-1 November 2017 Page 12 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 18 Human resources 08/09- 16 3 It is recommended for County Legal Counsel to evaluate whether the authorization/disclosure forms currently being utilized comply with FCRA. Underway Underway HR has evaluated the background requirements for classifications/departments and is reviewing our background process and forms. HR will work with the 3 identified departments conducting additional background reviews (as required by their positions) to review processes and forms. HR will work with Risk and Legal to ensure compliance with FCRA for all departments Feb-18 19 Human resources 08/09- 16 3.1 It is recommended the County train and work with departments to establish meaningful procedures to comply with the FCRA. This might require some revision to the current background policy (HR-3) or personnel rules. Underway Underway HR is evaluating current department practices and procedures regarding background policy. HR continues to explore third party service options and opportunities to integrate with new HR software. Jun-18 20 Human resources 08/09- 16 3.2 It is recommended the County develop standardized “pre-adverse action disclosures” and “adverse action notices” to provide to candidates whose applications are denied, in whole or in part, on the basis of information contained within a “consumer report.” Underway Underway HR is evaluating current department practices and procedures regarding background policy. HR has updated our process to include coordination of disclosure to candidates when applicable. HR continues to explore third party service options and opportunities to integrate with new HR software. Jun-18 2017 Global Follow-up report #17/18-1 November 2017 Page 13 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 21 Human resources 08/09- 16 5.1 It is recommended for the County to implement an authorization form for a driving history record check consistent with the spectrum of job positions. It is recommended the job application or authorization form have candidates identify the state(s) they have lived in over the prior five years. Underway Underway HR is evaluating current department practices and procedures regarding driving specific positions. HR intends to update job descriptions with driving requirements as part of the Compensation and Classification project. Jun-18 22 Law Library transition 15/16-5 1 It is recommended the MOU be updated to address the extent and expectations of law library services provided in print collections and through online legal subscriptions. These expectations should be determined with the assistance of the Deschutes Public Library. Underway Completed MOU revised to better delineate expectations for minimum resource materials. 23 Light fleet management 14/15- 10 1 It is recommended the County [with the assistance of the Fleet Manager (Road)] develop a fleet management policy, obtain input from County management and departments, and secure approval of the policy from upper management/Board. Underway Underway The fleet manager is in the process of finalizing exhibits related to specific fleet needs of client departments. Nov-17 24 Light fleet management 14/15- 10 2 It is recommended the policy guidance include associated forms and materials anticipated to be used to control and monitor vehicle fleet decisions. Underway Underway Included in final draft. Nov-17 25 Light fleet management 14/15- 10 3 It is recommended for the County to consider policies that support increasing vehicle utilization. Underway Underway Included in final draft. Nov-17 2017 Global Follow-up report #17/18-1 November 2017 Page 14 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 26 Light fleet management 14/15- 10 4 It is recommended the County utilize the Fleet Manager role to better understand and develop practices for improving vehicle utilization. Underway Underway Included in final draft. Nov-17 27 Light fleet management 14/15- 10 5 It is recommended for the Road Department to develop a system for providing a value for transfers of vehicles between departments. Underway Underway Included in final draft. Nov-17 28 Light fleet management 14/15- 10 6 It is recommended for the Road Department to consider whether it would be beneficial to further refine the way it accounts for its costs. Underway Underway To be addressed with new data, post implementation. Jun-19 29 Light fleet management 14/15- 10 7 It is recommended for the County to consider how to establish motor pools and associated charges for departments that use them. Underway Underway Referenced in final draft. Nov-17 30 Light fleet management 14/15- 10 8 It is recommended the County consider implementing an internal service fund approach for fleet. Planned Planned To be evaluated, post- implementation. Nov-17 31 Light fleet management 14/15- 10 9 It is recommended for the County (and Road Department) to establish performance measures to assist in assessing the effectiveness and efficiency of the light vehicle fleet as well as fleet services provided. Underway Underway Included in final draft. To be refined upon implementation of new cost accounting software. Nov-17 2017 Global Follow-up report #17/18-1 November 2017 Page 15 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 32 Light fleet management 14/15- 10 10 It is recommended the County institute a system to identify take home vehicle usage and evaluate how to comply with IRS rules. Underway Underway To be addressed separately with Finance Jan-18 33 Light fleet management 14/15- 10 11 It is recommended for the County to take steps to inform affected departments and employees of potential taxable fringe benefits resulting from take home vehicle use. Underway Underway Tied to #10 Jan-18 34 Light fleet management 14/15- 10 12 It is recommended the County establish sufficient systems to gather information that will be needed to evaluate, calculate and report the income and payroll tax for take home vehicles. Planned Underway Tied to #10 Jan-18 35 Light fleet management 14/15- 10 13 It is recommended for the departments to institute appropriate policies over provided take home vehicles. Underway within Road Completed Complete. 36 Light fleet management 14/15- 10 14 It is recommended the County consider approaches to assure policies are communicated and implemented by departments. Policy GA-19 should be shared with all departments. Planned Underway Included in final draft. Nov-17 2017 Global Follow-up report #17/18-1 November 2017 Page 16 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 37 Property & Facilities 11/12- 12 4 Based on the discussions from this year’s budget committee, it is further recommended for the County to consider an accounting and budgeting process for building usage costs to assure transparency, equity and fairness in costs and sufficiency to meet debt and future repairs. The County may also need to address in the solution the rules under OMB A-87 for cost allocations. Planned Underway As part of the FY 2017-18 budget process, the Facilities Department completed Phase I of a facilities assessment for long term capital needs. The Facilities Department will work with County Administration to develop general guidelines on funding for future capital replacement needs (for example, when Fund 142 will pay for a capital maintenance project versus the client department or combination of both). Dec-18 38 Selected Electronic Communicat ions 13/14-4 1 It is recommended for the County Clerk and County Management to implement a records management program for electronic public records consistent with the State’s requirements. Underway Underway Draft policy ready for BOCC approval. Will schedule by Dec 2017. Dec-17 39 Selected Electronic Communicat ions 13/14-4 3 It is recommended for the County to complete the development of policies and procedures over electronic public records. These should address the areas in the draft policy requiring further development as well as methods to assess, monitor and enforce the policies and procedures. Underway Underway Draft policy ready for BOCC approval. Will schedule by Dec 2017. The draft policy includes best practices for maintaining electronic records, but allows departments to decide how to maintain electronic records. Dec-17 40 Selected Electronic Communicat ions 13/14-4 4 It is recommended for current Departmental policies to be revisited and modified to be consistent with the revised Countywide policies and procedures for electronic public records. Underway Planned Mar-18 2017 Global Follow-up report #17/18-1 November 2017 Page 17 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 41 Selected Electronic Communicat ions 13/14-4 5 It is recommended the County provide sufficient new-hire, initial and ongoing training on County policies and procedures regarding public records, retention categories and County management of public records to adhere to County and State requirements. Planned Planned Mar-18 42 Selected Electronic Communicat ions 13/14-4 6 It is recommended this training apply to all County staff and non- County staff using County systems unless management has developed procedures to exempt them. Planned Planned Discussion: training for all employees may be an over reach. It may be better for each department to decide which employees should attend training. Mar-18 43 Selected Electronic Communicat ions 13/14-4 7 It is recommended for Departments to provide retention specific guidance to staff for frequently encountered areas of retention. Underway Underway Mar-18 44 Selected Electronic Communicat ions 13/14-4 9 It is recommended for IT to assist in vetting and supporting any electronic records management systems contemplated. Underway Underway IT recommends the use of the in- house software "Laserfiche" or the State recommend system ORMS 45 Selected Electronic Communicat ions 13/14-4 11 To the extent a system is in place, it is recommended management develop an approach to meeting document management objectives. Underway Underway Mar-18 46 Selected Electronic Communicat ions 13/14-4 13 It is recommended for the County to address texts, social media, website content and usage of personal devices in its policy for public records. Underway Underway Dec-17 2017 Global Follow-up report #17/18-1 November 2017 Page 18 Count Department Audit# Rec# Recommendation Prior or Original Status New Status New Comments New Estimated Date 47 Solid Waste 03/04-1 2 Office staff should document in writing all accounting policies and procedures. These policies and procedures should be available to all employees and should detail the responsibilities of each employee. The procedures should emphasize the areas of revenue and deposit handling, monitoring, supervision and segregation of duties. Underway Completed Might be covered by latest report. {END OF REPORT}