Orange County Public Schools Internal Audit Annual Update December 13, 2016
Orange County Public Schools Internal Auditing • Definition – “Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.” Source: International Professional Practices Framework of the Institute of Internal Auditors 2
Orange County Public Schools Code of Ethics • Mandatory for IIA* members (we are members) • Internal auditors are expected to apply and uphold the following principles: – Integrity – Objectivity – Confidentiality – Competency * Institute of Internal Auditors 3
Orange County Public Schools Audit Advisory Committee • Operates pursuant to a charter approved by the School Board • Oversees all audit functions of OCPS • Provides required independence for the Internal Audit Function 4
Orange County Public Schools Audit Committee Responsibilities • Review the plans, activities, staff and organizational structure of Internal Audit • Ensure no restrictions on Internal Audit • Review and concur in the appointment, replacement or dismissal of the Senior Director 5
Orange County Public Schools Audit Committee Responsibilities - continued • Review effectiveness of internal and external audit functions • Serve as the auditor selection committee in accordance with Florida Statutes • Report at least annually to the School Board 6
Orange County Public Schools Audit Committee Mem bers Charles Puckett, CPA - Committee Chairman, Partner, McDirmit • Davis & Co., CPA’s Scott Funston – Vice President Finance, Shanghai Disney Resort • Debi Roth, CIA – Managing Director – Global Standards & Guidance, • Institute of Internal Auditors Kay Redlich – Senior VP, Technology & Operations, CNL Financial • Group Dan Williams, CPA – Senior VP of Internal Audit, Darden • Restaurants, Inc. Ex-officio Members School Board Chairman Bill Sublette • General Counsel Woody Rodriguez • 7
Orange County Public Schools 2016 Activities of Audit Committee • Reviewed & approved the entity-wide risk assessment process and results • Reviewed & recommended School Board approval of the annual audit plan • Met with external auditors at beginning of audit process to establish expectations and will meet at end of audit to discuss results 8
Orange County Public Schools 2016 Activities - continued • Accepted results of the Peer Review of the Internal Audit Department • Conducted the annual performance appraisal of the Senior Director • Monitored Internal Audit department performance against annual audit plan 9
Orange County Public Schools 2016 Activities - continued • Performed the committee self-assessment and review of committee and Internal Audit charters • Acted as proposal evaluation committee for Schools’ Internal Accounts Audit Services 10
Orange County Public Schools Key Points • Internal audit function is independent via its reporting relationship to the School Board through the Audit Committee • The annual audit plan is being accomplished • The Audit Committee actively oversees the audit function and maintains a focus on continuous improvement 11
Orange County Public Schools Internal Audit Function Current Resources • One Senior Director and five staff (one vacancy at present) • Two CPAs (Certified Public Accountants) • Two CIAs (Certified Internal Auditors) • One CGAP (Certified Government Auditing Professional) • One CRMA (Certified in Risk Management Assurance) Accomplishments Please refer to the Internal Audit Annual Report published separately 12
Orange County Public Schools Coming Initiatives • Continue to reduce the number of audit findings outstanding for more than 1 year (The Internal Audit Department maintains a listing of open comments from audits to ensure that all items brought to the attention of management are addressed.) • Continue developing a more mature enterprise risk management function • Increase Internal Audit staff to better address audit priorities in light of growing needs 13
Orange County Public Schools Findings by Age in Months as of November 7, 2016 (81 findings from 21 reports) More than 2 years 6 Approximately 30 of the 7% items in the 1-2 years category moved into Less than 6 months that category recently. 16 These are findings from 20% an audit of IT Controls. It is anticipated that some of these items will require additional time 6 months - 1 year 1 - 2 years to complete, but 14 45 Internal Audit and ICTS 17% 56% have a process underway to monitor progress in addressing these issues. Less than 6 months 6 months - 1 year 1 - 2 years More than 2 years 14
Orange County Public Schools Number of Auditors per $100 Million, Select CGCS School Districts 2.00 1.69 1.75 1.50 1.25 1.10 1.08 1.00 0.88 0.86 0.84 0.77 0.67 0.75 0.65 0.65 0.63 0.63 0.63 0.52 0.49 0.49 0.43 0.41 0.50 0.35 0.35 0.31 0.27 0.27 0.25 0.22 0.25 0.00 15
Orange County Public Schools Auditors Per $100 Million of General Fund Budget Large Florida School Districts 2.11 1.37 1.06 0.83 0.78 0.78 0.31 Miami-Dade Broward Hillsborough Orange Palm Beach Duval Pinellas 16
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