OIG Budget, Organizational Structure & Operations

Budget, Facilities and Audit Committee

Tuesday, November 17, 2015

OFFICE OF THE INSPECTOR GENERAL

Introduction

FY 2016 OIG Budget is $7.6 million

57 authorized positions

Currently there are 6 vacancies

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Office of the Inspector General

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Office of the Inspector General

General Fund

56%

Bond Fund

42%

Integrated Disability

Mgmt Fund

2%

FY 2016 OIG Budget

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Office of the Inspector General

Organizational Chart

(18)(14) (18)

(1)

Quality Control &

Assurance

(2)

Administration &

Budget Support

(4)

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Quality Control & Assurance

Quality Control &

Assurance (2)

Quality Control &

Assurance Specialist

Quality Control &

Assurance Specialist

FUNDING TYPE

Quality Control & Assurance 2 % of Unit

General Funded 1 50%

Bond Funded 1 50%

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Quality Control & Assurance

Description of Work:

Independently plan and conduct quality assurance reviews to ensure that audits are

performed in compliance with established Federal, State, and departmental standards.

Typical Duties/Work Performed:

• Conduct QC&A reviews of work plans, audits and other work products

• Conduct follow-up audits to determine if recommendations were implemented

• Maintain department training records

• Coordinate peer reviews every 3 years

• Maintain Procedure Manuals in accordance with standards

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Administration & Budget Support

Administration &

Budget Support (4)

Principal Admin Analyst

Senior Admin Assistant

Admin Assistant

Senior SecretaryFUNDING TYPE

Administration & Budget Support 4 % of Unit

General Funded 2 50%

Bond Funded 1 25%

Split Funded (GF/BF) 1 25%

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Administration & Budget Support

Description of Work:

Perform a variety of administrative duties in support of OIG operations.

Typical Duties/Work Performed:

• Coordinate payroll, budget and personnel administration

• Provide administrative support and analysis to OIG staff

• Provide IT maintenance, systems and website support

• Coordinate preparation and distribution of OIG reports

• Handle office mail, records, supplies & equipment

• Direct telephone calls, visitors and inquiries

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Investigations Unit

Investigations Unit (14) (1 vacancy)

Deputy Inspector General

Supervising Investigator

(4) Senior Investigators

(6) Investigators

Forensic Accountant

Investigative Assistant

FUNDING TYPE

Investigations Unit 14 % of Unit

General Funded 6 43%

Bond Funded 2 14%

Split Funded (GF/BF) 5 36%

Integrated Disability Mgmt Funded 1 7%

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Investigations Unit

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Investigations Unit

Description of Work:

Investigate allegations of improper or illegal activities by District employees, contractors or

other entities doing business with the District.

Typical Duties/Work Performed:

• Conduct investigations regarding possible fraudulent activities and violations of District

policies

• Manage the District’s Fraud Hotline

• Perform Due Diligence investigations for Charter Schools and Facilities

• Perform Background investigations for executive level employment

• Issue Subpoenas

• Investigate violations of the Whistleblower Protection Policy

• Investigate fraudulent disability claims

• Refer cases to the local district attorney or other prosecutorial authority

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Contract Audit Unit

Contract Audit Unit (18) (4 vacancies)

Depty Inspector General

(2) Audit Managers

(4) Principal Auditors

(8) Sr Auditors

Facilities Project Mgr

Architect

Asst Admin Analyst

FUNDING TYPE

Contract Audit Unit 18 % of Unit

General Funded 0 0%

Bond Funded 16 89%

Split Funded (GF/BF) 2 11%

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Contract Audit Unit

Principal Auditor

Audit Manager

Sr Auditor

Sr Auditor

Principal Auditor (V)

Sr Auditor (V)

Sr Auditor

(V) = Vacant

Principal Auditor

Audit Manager

Sr Auditor

Sr Auditor

Principal Auditor (V)

Sr Auditor

Sr Auditor

Fac Proj Mgr (V)

Architect

Asst Admin

Analyst

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Contract Audit Unit

Description of Work:

Conduct audits of the District’s procurement system and of District contracts for goods

and services as well as contracts for the construction and modernization program.

Typical Duties/Work Performed:

• Conduct audits of construction, professional services and supplies contracts

• Perform technical evaluations of completed projects

• Review construction change orders

• Perform pre‐award audits that are used by District staff for contract negotiations• Perform special reviews and studies related to the District’s procurement system and

bond related District programs

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Internal Audit Unit

Internal Audit Unit (18) (1 vacancy)

Depty Inspector General

(3) Audit Managers

(4) Principal Auditors

(7) Sr Auditors

(3) Auditors

FUNDING TYPE

Internal Audit Unit 18 % of Unit

General Funded 15 83%

Bond Funded 2 11%

Split Funded (GF/BF) 1 6%

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Internal Audit Unit

Principal AuditorAudit Manager

Sr Auditor Sr Auditor

Principal Auditor

Sr Auditor

Sr Auditor

(V) = Vacant

Principal Auditor

Audit Manager

Sr Auditor

Sr Auditor

Principal Auditor

Sr Auditor

Auditor Auditor Auditor (V)

Audit Manager

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Internal Audit Unit

Description of Work:Conduct audits of District programs, processes and functions to help support organizational

improvement, help ensure adequate internal controls are in place, verify compliance with laws and

regulations, safeguard District assets, provide information to manage risks, and offer insights about

whether desired outcomes are being achieved.

Typical Duties/Work Performed:

• Conduct audits to provide assurance about internal controls over operations,

reporting and compliance

• Recommend improvements to help protect District assets and increase the

effectiveness and efficiency of processes

• Perform charter school audits in support of Charter Schools Division oversight

• Perform school audits and limited reviews to test compliance

• Determine whether policies and procedures are being followed

• Conduct IT related audits and support QC follow-up reviews

Average Cost for Charter School Audits

The average charter school audit can be completed in 3-6 months.

Depending on the complexity of the audit, the following is the range of

cost for a charter school audit:

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Charter School Audits

Charter School Audit Cost Range

3 months 6 months

Basic Charter School Audit $ 69,811 $ 139,622

Complex Charter School Audit $ 74,992 $ 149,985

Shared Cost of Forensic Reviews

The OIG had to outsource forensic review services for two charter school

audits.

The following were the amounts paid by CSD and OIG:

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Charter School Audits

Amounts paid for Forensic Reviews

OIG CSD TOTAL

Magnolia (FY 2014) $ 68,082 $ 57,200 $ 125,282

Celerity (FY 2015) $ 25,000 $ 150,500 $ 175,500

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Due Diligence Process

Charter Due Diligence Process for a basic Charter Due Diligence request with one parent company, one school and

up to three petitioners (1. Exec. Director 2. Principal 3. On-Site Financial Manager).

Time varies significantly for requests with multiple schools and/or additional petitioners. As

well as for petitioners with a significant number of search results and results that lead to

courts outside the Los Angeles jurisdiction.

Basic Charter Due Diligence Hours

Intake of Request/Administrative Processing 1

Assign to Investigator                              _

Public Record Searches 20

Analysis of Results/Records 16

Report Preparation 16

Peer Review 3

Supervisor QA Review 3

Administrative Closure/Issuance 1

TOTAL HOURS 60

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Due Diligence Costs

Charter Due Diligence The costs associated with Charter Due Diligence requests vary significantly based on

the number of petitioners and the number of records to be accessed.

Salary Costs* $3,507

*Based on basic request

Database Costs

Lexis Nexus License Fee

TLOxp Monthly Fee

LA County Superior Court Per Search Fee

TimeMatters License Fee

PACER Per Search Fee

Basic Charter Due Diligence Costs

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Agreement with CSD

Funding for OIG Charter Activities

The OIG and the Charter Schools Division (CSD) discussed collective

work efforts with charter schools and the resource needs to help ensure

timely completion of due diligence reports and audits.

Based on these conversations, CSD has agreed to provide $212,504 in

funding for staff resources to support OIG charter-related work.

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Budget Needs for High Risk Areas

Additional OIG Staff

OIG operations could be improved by augmenting staff for the most

high-risk areas which include financial fraud, financial investigations,

forensic accounting, and due diligence investigations:

Additional Staff

(2) Investigative Assts $ 217,568

(2) Forensic Accountants $ 265,884

Admin Aide $ 86,776

TOTAL COST $ 570,228

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OIG Budget, Organizational Structure & Operations

Any Questions?

To learn more about the OIG, please visit the OIG website:

http://achieve.lausd.net/oig