Legislature(2021 - 2022)
08/27/2021 09:00 AM Senate LEGISLATIVE BUDGET & AUDIT
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| Audio | Topic |
|---|---|
| Start | |
| Approval of Minutes | |
| Executive Session | |
| Final and Preliminary Audit Releases | |
| Other Committee Business | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
LEGISLATIVE BUDGET AND AUDIT COMMITTEE
Anchorage, Alaska
August 27, 2021
9:05 a.m.
MEMBERS PRESENT
Senator Natasha von Imhof, Chair
Senator Lora Reinbold (via teleconference)
Representative Ivy Spohnholz
Representative Andy Josephson (via teleconference)
Representative James Kaufman (via teleconference)
Representative Dan Ortiz (alternate, via teleconference)
MEMBERS ABSENT
Representative Chris Tuck, Vice Chair
Senator Peter Micciche
Senator Bert Stedman
Senator Lyman Hoffman
Representative Neal Foster
Senator Click Bishop (alternate)
COMMITTEE CALENDAR
APPROVAL OF MINUTES
EXECUTIVE SESSION
FINAL AUDIT REPORTS
PRELIMINARY AUDIT REPORT
OTHER COMMITTEE BUSINESS
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
KRIS CURTIS, Legislative Auditor
Legislative Agencies and Offices
Juneau, Alaska
POSITION STATEMENT: During discussion of other committee
business, presented 10 issues to address through an audit
oversight process.
ACTION NARRATIVE
9:05:53 AM
CHAIR NATASHA VON IMHOF called the Legislative Budget and Audit
Committee meeting to order at 9:05 a.m. Representatives
Spohnholz, Kaufman (via teleconference), Josephson (via
teleconference), and Ortiz (via teleconference) and Senators von
Imhof and Reinbold were present at the call to order.
^APPROVAL OF MINUTES
APPROVAL OF MINUTES
9:07:08 AM
CHAIR VON IMHOF announced that the first order of business would
be the approval of minutes.
9:07:12 AM
REPRESENTATIVE SPOHNHOLZ moved that the Legislative Budget and
Audit Committee approve the minutes from the 7/29/21 meeting.
9:07:21 AM
REPRESENTATIVE KAUFMAN objected.
REPRESENTATIVE KAUFMAN moved to amend [the third] sentence of
the third paragraph on page 4 of the 7/29/21 Legislative Budget
and Audit Committee meeting minutes, such that the word
"protective" be replaced with "corrective" and, in the same
sentence, the words "a" and "mode" be deleted. With those
changes, the sentence would read: "He proposed corrective
action tracking on the most critical items." There being no
objection, it was so ordered.
9:08:49 AM
CHAIR VON IMHOF asked if there was any objection to the 7/29/21
minutes, as amended. There being none, the 7/29/21 Legislative
Budget and Audit Committee minutes, as amended, were approved.
^EXECUTIVE SESSION
EXECUTIVE SESSION
9:08:57 AM
CHAIR VON IMHOF announced that the next order of business would
be an executive session to consider the final audit reports for
the Alaska Mental Health Trust Authority and the Board of
Examiners in Optometry and the preliminary audit report for the
Board of Chiropractic Examiners.
9:09:15 AM
REPRESENTATIVE SPOHNHOLZ moved that the Legislative Budget and
Audit Committee go into executive session under Uniform Rule
22(b)(3) for the discussion of matters that may, by law, be
required to be confidential. She asked that the following
persons remain in the room or online: The legislative auditor
and necessary staff of the auditor; any legislators not on the
committee; staff for legislators that are on the committee; and
the House Finance Committee secretary. There being no
objection, it was so ordered.
9:09:45 AM
The committee took an at-ease from 9:10 a.m. to 10:36 a.m. for
the purpose of executive session.
10:36:22 AM
CHAIR VON IMHOF called the Legislative Budget and Audit
Committee meeting back to order at [10:36] a.m. Representatives
Spohnholz, Kaufman (via teleconference), Josephson (via
teleconference), Ortiz (alternate, via teleconference) and
Senators von Imhof and Reinbold (via teleconference) were
present at the call to order.
^FINAL AND PRELIMINARY AUDIT RELEASES
FINAL AND PRELIMINARY AUDIT RELEASES
10:36:55 AM
CHAIR VON IMHOF announced that the next order of business would
be the final and preliminary audit releases.
[Two motions made at this point were repeated forthwith for the
purpose of required roll call voting when an alternate is needed
to establish a quorum.]
10:38:20 AM
REPRESENTATIVE SPOHNHOLZ moved that the Legislative Budget and
Audit Committee release the following final audit reports: The
Alaska mental Health Trust Authority and the Board of Examiners
in Optometry.
10:38:30 AM
A roll call vote was taken. Representatives Spohnholz,
Josephson (via teleconference), Kaufman (via teleconference),
Ortiz (alternate, via teleconference) and Senators von Imhof and
Reinbold (via teleconference) voted in favor of releasing the
final audit reports. Therefore, the final audit reports for the
Alaska Mental Health Trust Authority and the Board of Examiners
in Optometry were released by a vote of 6-0.
10:40:44 AM
REPRESENTATIVE SPOHNHOLZ moved that the Legislative Budget and
Audit Committee release the following preliminary audit report
to the agencies for response: Board of Chiropractic Examiners.
10:40:51 AM
A roll call vote was taken. Representatives Spohnholz,
Josephson (via teleconference), Kaufman (via teleconference),
Ortiz (alternate, via teleconference) and Senators von Imhof and
Reinbold (via teleconference) voted in favor of releasing the
preliminary audit. Therefore, the preliminary audit for the
Board of Chiropractic Examiners was released to the agencies by
a vote of 6:0.
^OTHER COMMITTEE BUSINESS
OTHER COMMITTEE BUSINESS
10:41:41 AM
CHAIR VON IMHOF announced that the final order of business would
be other committee business.
CHAIR VON IMHOF invited Kris Curtis to present the audit
oversight framework. She stated that members would have until
October to consider the oversight process and offer ideas and/or
propose changes, at which point the committee would vote whether
to adopt the process. She noted that the related documents are
available to the public on BASIS. She said there are currently
10 recommendations.
10:43:12 AM
KRIS CURTIS, Legislative Auditor, Division of Legislative Audit,
reviewed that at its last meeting the committee had discussed
ways in which it could encourage the resolution of audit
findings. Subsequently, Representative Kaufman had asked her to
suggest a framework to formalize an audit finding oversight
process. She began a PowerPoint presentation, entitled "LB&A
Oversight - Top 10 Audit Issues" [hard copy included in the
committee packet].
MS. CURTIS displayed slide 1, on which is a graph showing
exponential growth of single audit findings from fiscal year
2010 (FY 10) to FY 20. She explained that the single audit is
the annual audit that covers federal compliance, all the federal
programs, and includes audits of financial statements. As shown
on the graph, in FY 10 there were 30 audit findings; that number
grew to 94 in FY 20. The most significant cause of that
increase has been turnover and lack of effective training at
executive branch agencies. She said agencies have not addressed
findings in a timely manner, and many audit issues remain
unresolved year after year.
MS. CURTIS turned to slide 2, which suggests a more formal,
five-step LB&A oversight process:
01. Focus
Identify top audit findings in terms of fiscal or
societal impact and degree of difficulty in addressing
findings.
02. Communicate
Work with auditees to identify corrective action for
top audit findings.
03. Evaluate
Determine whether corrective action requires
legislative action. Refer to legislative committee for
consideration.
04. Measure
Examine progress through the legislative finance
committee process.
05. Repeat
Once Single Audit is released - repeat. Process covers
all audit reports issued over a fiscal year.
10:45:15 AM
MS. CURTIS identified the top 10 audit issues [listed on slides
4-13]. Number one [on slide 4] was as follows:
1. ACFR Opinion Modifications
Issues that led to Qualified Audit Opinion
square4 Revenues eligible for transfer to the Constitutional
Budget Reserve Fund (CBRF) due to FERC decisions were
not transferred during FY 18 through FY 20 and fund
balances that should have remained in the CBRF were
moved to the General Fund.
square4 The Department of Natural Resources did not transfer
to the Alaska Permanent Fund all dedicated mineral
lease revenues received during FY 18 and FY 19.
Single Audit Findings (Reference)
square4 2020-019, 2020-068 (CBRF transfers)
square4 2020-067 (Perm Fund transfers)
MS. CURTIS explained a change to the annual comprehensive
financial report (ACFR) from a previous acronym that was
discovered to be an offensive term in South Africa. She pointed
out that each slide has a reference to the single audit and can
be found on legaudit.akleg.gov, in Section 2. Regarding the
second bullet point, she said the fiscal impact of the non-
transfer was $200 million.
MS. CURTIS covered audit issue number two, on slide 5:
2. ACFR Errors and Timeliness
Significant errors and late draft statements
square4 FY 20 draft financial statements provided to
Legislative Audit six weeks late similar to past 5
years.
square4 Although improvements noted in the FY 20 number and
severity of errors compared to prior three years,
auditors still note a lack of support provided to
division responsible for preparing financial
statements in terms of resources and training.
Single Audit Findings (Reference)
square4 2020-001, 2020-006, 2020-007, 2020-008, 2020-009,
2020-011, 2020-025, 2020-057, 2020-067, 2020-068,
2020-070, 2020-078, 2020-015
MS. CURTIS emphasized the delinquent receipt of draft statements
and explained that means the division cannot meet the statutory
timeline of providing an audit opinion by December 14. She
added, "That is because the Division of Finance is not getting
the support that it needs; it has very significant turnover, a
lack of training, and so those issues really need to be
addressed in order to produce statements in a timely manner."
10:47:44 AM
MS. CURTIS addressed audit issue number 3, on slide 6:
3. Medicaid Eligibility Determinations
Significant errors in accuracy and timeliness of
eligibility determinations
square4 Division of Public Assistance (DPA) eligibility
technicians did not process applications in a timely
manner or redetermine eligibility when required for
27.5 percent of Medicaid cases tested and 36 percent
of CHIP cases tested.
square4 Inaccurate eligibility determinations found in 32.5
percent of Medicaid cases tested and 40 percent of
CHIP cases tested.
square4 Special audit 06-30094-20 found that, during FY 19,
DHSS paid $28 million in State general funds for
ineligible benefits due to eligibility errors.
Single Audit Findings (Reference)
square4 2020-045, 2020-046
MS. CURTIS covered audit issue number four, on slide 7:
4. Medicaid Eligibility System - ARIES
Material weakness in internal controls
square4 DHSS staff did not maintain, in all material respects,
effective internal controls for the Alaska Resource
for Integrated Eligibility Services (ARIES) System
during FY 20.
square4 System control deficiencies contribute to eligibility
errors.
Single Audit Finding (Reference)
square4 2020-044
MS. CURTIS said, "This has been contributing to the problem that
we just talked about." She said the system was new as of FY 14;
it was implemented as a result of Medicaid expansion and has
significant control issues contributing to problems in
eligibility determination.
MS. CURTIS brought attention audit issue number five, on slide
8:
5. Medicaid Claims Reprocessing Errors
Cumbersome process for analyzing claims outside MMIS
is prone to error
square4 Services provided to Medicaid-eligible American
Indian/Alaska Native members received through a Tribal
Health Organization but rendered at a non-IHS/Tribal
provider are eligible for 100 percent federal
reimbursement if certain requirements are met.
Eligible claims are reprocessed outside MMIS based on
DHSS staff analysis.
square4 Errors led to $1,007,134 in questioned costs. Similar
error in prior year.
Single Audit Finding (Reference)
square4 2020-043
MS. CURTIS said the manual process of making these claims
is prone to error. She related that in addition to the $1
million error shown in the second bullet point, last year
errors were approximately $3 million, and this is why this
issue is listed in the top 10.
10:49:08 AM
MS. CURTIS discussed audit issue number six, on slide 9:
6. Medicaid Dental Overutilization
Likely overutilization of dental services by
individuals under the age of 21
square4 Children's dental services require prior authorization
at a much lower rate than adult dental services.
square4 Review of FY 20 claims for those under the age of 21
found alarming indications of likely overutilization.
square4 DHSS's surveillance and utilization and control
procedures were not effective at identifying and
following up suspicious billing patterns.
square4 Similar deficiency identified for FY 19.
Single Audit Finding (Reference)
square4 2020-040
MS. CURTIS continued to audit issue number seven, on slide 10:
7. Medicaid SURS Program
DHSS has not implemented an effective statewide
surveillance and utilization control program to
safeguard against unnecessary or inappropriate use of
Medicaid services.
SURS program historically carried out by Medicaid
fiscal agent.
Department took over program during FY 19 but has
program is not effective.
Single Audit Finding (Reference)
square4 2020-050
MS. CURTIS added that the program was found in FY 20 to be
completely ineffective. She then brought attention to audit
issue number 8, on slide 11:
8. TANF Eligibility
Material weakness and material noncompliance over
eligibility and special tests and provisions
square4 High rate of error in determining eligibility. (18 of
58 cases or 31 percent)
square4 28 of 58 cases (48 percent) lacked documentation to
support the request and use of data exchanges
necessary for determining eligibility and benefit
amount.
square4 DPA has been unable to allocate the necessary
resources to fully develop and implement adequately
designed internal controls to ensure compliance.
Single Audit Findings (Reference)
square4 2020-033, 2020-037
MS. CURTIS added that this has been a problem for the Department
of Health and Social Services for multiple years.
10:50:53 AM
MS. CURTIS highlighted audit issue number nine, on slide 12:
9. UI Subsystem
Unemployment claims were paid to Department of
Corrections inmates that were unavailable for work.
square4 New UI subsystem was not programmed to cross-match
with DOC or outside source data.
Single Audit Finding (Reference)
square4 2020-060
MS. CURTIS noted the UI Subsystem was implemented in a hurry by
the Department of Labor & Workforce Development (DLWD) to deal
with new groups eligible under "the COVID funding." The
Legislative Audit Division found that inmates were
inappropriately obtaining UI through this subsystem.
MS. CURTIS brought attention to audit issue number 10, on slide
13:
10. DOR Investment Oversight
The DOR commissioner's decision to loan up to $22.5
million to MOC 1 [the Mustang Operation Center] under
the authority of the department's investment statutes
was not appropriate when compared with behavior that a
prudent person would consider reasonable.
square4 The legislature should consider enhancing oversight of
DOR's [the Department of Revenue's] investment
functions.
Audit Report Finding Reference
square4 Audit Control Number 04-30093-20 Recommendation No. 4
MS. CURTIS noted MOC was owned by the Alaska Industrial
Development and Export Authority (AIDEA).
10:52:13 AM
MS. CURTIS said she would now move into the suggested oversight
process in more detail, slides 14 and 15. She began with the
description of the oversight process, on slide 14:
Suggested Oversight Process
Letters from LB&A Committee to audit agencies asking
for corrective action plan.
square4 Letters drafted by Legislative Auditor and reviewed by
Chair.
square4 Request corrective action plan and dates for
resolution.
LB&A Committee evaluates responses
square4 Legislative Auditor reviews agency responses and
presents summary to LB&A Committee.
square4 Committee determines whether any action is necessary
to facilitate resolution.
square4 Information is forwarded to the appropriate
legislative committee for consideration. Single Audit
findings and corrective action are sent to finance
committees for follow-up during the budget process.
MS. CURTIS then gave the oversight process timeline, on slide
15:
Oversight Timeline
May Sep
Identify Top 10 audit issues. LB&A [Legislative Budget
& Audit] Committee sends letter to executive branch
agencies asking for corrective action.
Oct Dec
LB&A Committee reviews corrective action, identifies
issues for legislative consideration, refers to
appropriate committees for consideration.
Jan April
Finance committees review progress in resolving audit
issues. Other committees consider legislative action,
if determined necessary.
Apr Jun
Legislative Audit identifies Top 10 audit issues for
next cycle and evaluates progress from prior year.
MS. CURTIS concluded the presentation with slide 16:
Summary
Audit findings are not being resolved timely.
A process is needed to encourage collaboration and
resolution.
The LB&A Committee, working through the Legislative
Auditor, is well-positioned to encourage resolution.
Utilizing the finance committees can facilitate
accountability and collaboration.
10:54:37 AM
REPRESENTATIVE KAUFMAN stated that this plan merges what the
Legislative Budget and Audit Committee has been doing with
quality management processes that try to find a resolution to
the problem. He encouraged collaboration. He said he thinks
this is a good process.
10:55:37 AM
REPRESENTATIVE JOSEPHSON expressed thanks to Representative
Kaufman. He then directed attention to slide [14], to "Letters
from LB&A Committee to audit agencies asking for corrective
action plan," and he asked whether "audit" should read
"audited."
MS. CURTIS confirmed yes. She indicated the reference is to
auditees.
10:56:07 AM
REPRESENTATIVE SPOHNHOLZ noted that one of the objectives of the
House Special Committee on Ways & Means, [which she chairs], is
to look for efficiencies in government. She expressed concern,
having read the single statewide audit, about known problems
that are not being addressed and cost the state money. She
opined that considering the state's current financial situation,
it needs to be utilizing every tool available. She said the
House Special Committee on Ways and Means would be inviting Ms.
Curtis to come speak on opportunities for efficiencies, after
which she suggested there could be a joint committee meeting to
delve into the financial implications of the recommendations
made by the legislative auditor.
10:57:37 AM
SENATOR REINBOLD expressed, "I think this is an outstanding
idea." She stated that for a long time she has thought that
audits should be part of the subcommittee process. She
expressed her support and her thanks to Chair von Imhof,
Representative Kaufman, and Ms. Curtis.
10:58:16 AM
REPRESENTATIVE ORTIZ echoed the comments of Senator Reinbold.
CHAIR VON IMHOF asked Representative Kaufman and Ms. Curtis to
reiterate "the activity and the action" that would happen going
forward.
10:58:44 AM
REPRESENTATIVE KAUFMAN referred to the oversight timeline. He
stated that "the nominees for the top 10" are being "socialized"
for opportunity to consider further issues. He acknowledged
there are more than 10 issues; the 10 on the list were chosen
via "a criticality ranking process" that discerned high-dollar
impacts and high service quality impacts, as well as considered
how old the findings are. He emphasized that it is important to
think systemically, and this is not about blaming current
workers but rather the systems that are in place.
Representative Kaufman talked about the current divided
political situation where there are differing opinions about how
much money to spend, and he said the convergence is around
incorporating this improvement process. He suggested that some
may feel more comfortable about spending money on services and
programs if they felt the services and programs delivered better
value. He stated, "I believe that ... there's a space here that
we can work in around this type of process, as applied to the
many things that we deal with legislatively." He expressed
willingness to help, and he thanked Ms. Curtis for her work on
this issue and her presentation today.
11:01:19 AM
REPRESENTATIVE JOSEPHSON asked whether there was "an eleventh
item" with which Ms. Curtis had "wrestled."
11:01:59 AM
MS. CURTIS responded no. She said compiling the list was pretty
easy; there are 94 findings in the single audit, all with which
she is familiar. She said she also looked over all the special
audits. She remarked that the number doesn't have to be 10, and
she recommended allowing the flexibility to determine year by
year whether to add more or include fewer.
CHAIR VON IMHOF stated that the list is public, and over the
next six weeks both the committee and the public would have an
opportunity to consider the list, at which point the list may be
"expanded or replaced with an item or two."
11:03:14 AM
REPRESENTATIVE KAUFMAN commented that the minority of issues is
causing the most problems. After working on those, progression
can be made. He explained that there may be synergistic
problems wherein one is feeding another.
11:04:47 AM
CHAIR VON IMHOF noted that the second audit finding is a
grouping of findings, and hopefully addressing it will take care
of several audit findings. She reiterated that the committee
had between now and October to review this list, at which point
it would take action.
MS. CURTIS confirmed that is correct.
CHAIR VON IMHOF thanked Ms. Curtis and Representative Kaufman.
11:05:53 AM
CHAIR VON IMHOF noted that another item to be addressed under
other committee business would be regarding information
technology (IT), as presented by Representative Spohnholz.
11:05:59 AM
REPRESENTATIVE SPOHNHOLZ stated that in the last few years
Alaska has had IT security breaches, attacks on state websites
and databases, that have caused serious challenges. There have
been a couple attacks on the Division of Elections where
personal information of over 100,000 registered Alaska voters
was shared. She said the Alaska Court system and the Department
of Health and Social Services had their websites attacked and
had to return to paper systems for extended periods of time.
She said she thinks this points to a weakness in IT security in
Alaska.
REPRESENTATIVE SPOHNHOLZ said she learned from Ms. Curtis that
an IT governance audit was done in 2008 that was helpful but has
not been done since. She remarked that the sophistication of
hackers is greater than it was in 2008. She said she has
reached out to the statewide Office of Information Technology
(OIT) but "they have been reluctant to talk with us." She said
it is not her intention to reveal security-related information,
but she thinks the issue needs to be examined to ensure the
administration has the resources necessary to ensure the safety
and security of Alaska's state systems. She talked about
exploring submission of a request for a confidential IT
governance audit which looks at operating procedures. She
proffered that in addition to helping the administration
identify "a road map for addressing some of these security
vulnerabilities," the audit could also identify for the
legislature opportunities to support the administration by
ensuring it has the resources necessary to reduce the state's
vulnerability to these kinds of attacks.
11:09:27 AM
CHAIR VON IMHOF asked whether Ms. Curtis understood what would
be asked of the Legislative Audit Division and whether the
division would be able to respond.
11:09:40 AM
MS. CURTIS answered yes. She said she and Representative
Spohnholz have discussed the issue and what the objectives would
be. She said she thinks they need to sit down with the chief of
OIT to determine what steps are already being taken; however,
she understands that OIT has been reluctant to take a meeting.
She expressed a desire to have cooperation so the division can
move forward with a draft request. In terms of whether the
division is ready to move forward on this, she said it does not
have the technical expertise and would likely have to hire
someone on contract.
11:11:05 AM
REPRESENTATIVE SPOHNHOLZ indicated one benefit of contracting
for the audit would be that the audit would not be in the queue
with all the division's other audits and, thus, could be
completed more expediently. She indicated the importance of
this factor considering the amount of time it has taken DHSS to
get back online.
11:12:23 AM
CHAIR VON IMHOF thanked Representative Spohnholz and Ms. Curtis
and said she thinks they are "on the right track." She asked
how they would like to proceed.
REPRESENTATIVE SPOHNHOLZ expressed her hope that the
administration would enter into a conversation. She reiterated
her desire for a collaborative process and to speak with the
chief of OIT. If that cannot happen, she said, the Legislative
Budget and Audit Committee has a responsibility to meet its
obligations; therefore, she recommended proceeding forward with
an audit request at the next meeting in October. She said
[breaches in security] create a risk for the state, and "we
cannot afford to delay much further." She stressed the
importance for the legislature to have the information necessary
to allocate resources. She commented on the aging systems in
place and the importance of updating them.
11:14:16 AM
SENATOR REINBOLD thanked Representative Spohnholz for bring the
issue forward. She referred to Article I, Section 22, of the
United States Constitution, regarding the protection of privacy,
and she said it is the responsibility of the legislature. She
said she did not remember whether it was Cisco or Microsoft that
manages a lot of the State of Alaska's data, but said [the
legislature] needs to specify what it expects from them. She
recommended "a company such as Tanium," which she said has an
excellent reputation. Senator Reinbold stated support for an
outside audit to be put forth in October. She expressed concern
for the "massive amounts of lawsuits" that could be brought to
the state as a result of the security breaches. She thanked
Representative Spohnholz again and said she supports this
effort.
REPRESENTATIVE SPOHNHOLZ clarified there is no evidence to
suggest that medical diagnoses or other highly confidential
protected information has been released. The data that has been
released was from the voter files and had no impact on election
security. She said there are hardcopy backup paper ballots.
What was shared was voter registration information "that was
available on the Division of Election's website." She concurred
with Senator Reinbold that people's personal information should
not be vulnerable to attacks and that the government has a core
responsibility to ensure the protection of that information.
SENATOR REINBOLD said she has heard from multiple individuals
that they have been unable to get their information from DHSS,
and she expressed interest in finding out "the scope of
violation."
CHAIR VON IMHOF, on that point, advised allowing Representative
Spohnholz and Ms. Curtis to continue to reach out to OIT so that
"a comprehensive and collaborative scope of audit can be
developed" in time for the next Legislative Budget and Audit
Committee meeting.
11:18:13 AM
REPRESENTATIVE KAUFMAN described the next improvement project
that could be undertaken, in terms of audits, as being "an idea
hopper" with a simple scoring system on a spread sheet that
allows the committee to evaluate the proposed use of resources
and ensure getting "the best bang for our buck."
11:19:28 AM
REPRESENTATIVE JOSEPHSON offered his understanding that [the
Legislative Audit Division] does that.
11:19:39 AM
MS. CURTIS responded that historically, the division deals with
audits on a "first-in/first-out" basis. She stated, "If an
audit request is approved by the committee, it has merit, and so
I don't know how I'd approach ranking them." She suggested one
exception may have been the acceleration of the [CARES Act]
Audit in spring 2021 to prioritize it. She mentioned
prioritizing the IT audit because it would not [affect the work
order of the division] since it would be done via contract;
therefore, "why would you want to put it in the hopper and just
have it sit there instead of getting it out there?" She
expressed interest in speaking to Representative Kaufman more
about this idea but reiterated the "first-in/first-out" method
and treating audits with equal merit.
11:21:08 AM
REPRESENTATIVE KAUFMAN explained that "this would be more within
the committee confines" in order for the committee to understand
its own priorities and have clear visibility "on the front end
and the back end." He concluded, "We rank importance of what we
ask for, and we rank importance of what we receive, and that's a
feedback loop that's very beneficial."
11:21:45 AM
CHAIR VON IMHOF suggested the committee could request a list of
special audits from Ms. Curtis, with expected start and
completion dates. She said there is statute to follow, as well
as the method expressed by Ms. Curtis of "first-in/first-out."
There is a process followed for moving or eliminating an audit.
MS. CURTIS confirmed she would provide the list.
11:22:29 AM
SENATOR REINBOLD said she would like an update on "the COVID
money, the state audit, and the federal audit," which she said
she had anticipated in early August but has yet to see. She
said she would like a comprehensive overview, as well.
CHAIR VON IMHOF offered her understanding that "the COVID
overview is the purview of administration," which provides that
on a monthly basis. She asked whether there may exist another
"COVID audit" other than the one for the business grants.
11:23:16 AM
MS. CURTIS answered yes. She offered her understanding that
Senator Reinbold was referring to "a desk review that's being
conducted by the U.S. Treasury on the state's use of COVID
funds," which was expected in August. She said she does not
expect the federal report to come out for a few months. In
terms of the current audit on the CARES Act business grants, she
said she anticipates the report will not come to the committee
before "early next year."
CHAIR VON IMHOF asked whether Ms. Curtis would provide the
committee the report from the federal audit when it becomes
available this fall.
MS. CURTIS replied that when it becomes a public document she
could give the committee an overview of the results.
11:24:51 AM
ADJOURNMENT
There being no further business before the committee, the
Legislative Budget and Audit Committee meeting was adjourned at
[11:25] a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| IVa LBA Audit Oversight Framework.pdf |
JBUD 8/27/2021 9:00:00 AM |
Oversight Framework |
| IIa LBA 072921 Meeting Minutes.pdf |
JBUD 8/27/2021 9:00:00 AM |
July 2021 Minutes |
| 8 27 21 LBA Agenda final.pdf |
JBUD 8/27/2021 9:00:00 AM |
August 2021 Agenda final |