1 office of the inspector general 2006 annual and activity reports cp/doc. 4248/07 and...
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Office of the Inspector General 2006 Annual and
Activity Reports CP/doc. 4248/07 and CP/doc.4247/07
Summary Presented by: Linda P. Fealing
Inspector General
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Introduction
Internal auditing is a management control that operates by measuring and evaluating the effectiveness of other management controls.
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MandateExecutive Order 95-05
Office of the Inspector General
Responsible to the Member States and the Secretary General for:
– Systematic review of the effectiveness of internal management and accounting controls.
– Identifying areas of High Risk and assisting in strengthening controls.
– Recommending improvements for the overall efficiency of all GS/OAS offices, departments, programs, divisions, units, activities and projects, both at Headquarters and in the Member States.
– Reporting on audit activities.
– Providing follow-up action on implementation of approved recommendations.
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Anti-Corruption Hotline
Executive Order 05-8 Corr. 1 Provides protection for whistleblowers and
informants. Encourages the reporting of misconduct that
violate OAS financial and administrative rules.
Allegations may be reported to the Inspector General in person, by telephone, by e-mail, by facsimile, by regular mail, anonymously or identifying yourself.
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Summary of 2006 Activities Conducted
Annex 1 of CP/doc. 4247/07
13 Audits – operational (8) and compliance (5) including 16 projects
6 Investigations – including 4 FEMCIDI projects
1 Evaluation of Staffing Needs
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2006 audits of Operational processes Headquarters
Educational Portal of the Americas Education Grants Recovery of Indirect Costs (Overhead)
GS/OAS Offices Antigua and Barbuda Barbados
Technical Secretariat of the Inter-American Children’s Institute
Risk Assessments Educational Portal OASES Reporting and Data Integrity
Summary of 2006 Activities Conducted
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2006 Compliance audit activities CPR Mechanism Projects Managed by DTTC:
CARANA (SG-TRD/008) OAS Executive Secretariat for Integral Development
Foreign Trade Information System (SICE) FTAA (SG-TRD/002) Overhead for Administration and Management
(SG-TRD/011)
Summary of 2006 Activities Conducted
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Summary of Investigations Conducted
2006 Investigations: 2005 OAS scholarship program expenditures. Fraudulent transactions processed in the GS/OAS Office in
Honduras.
Four FEMCIDI funded projects Jamaica: Supporting the Development of a Neutraceutical
Industry. Honduras: Let's save the first grade. Mexico: Pedagogical Supports for the Integration into the
Regular School System of Minors up to six years old with Disabilities.
Nicaragua: Initiative for the Development of the Technical- Pedagogical Capacity in the Management of Education and the Local Development.
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All OIG reports were approved by the Secretary General.
74 recommendations issued
• 34% related to distribution of written instructions, compliance with
directives, and amendments to existing procedures.
• 35% related to operational processes for improved internal controls.
• 16% were Systems related.
• 15% related to recovery of funds, staffing needs, etc.
Recommendations
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Follow-Up
Thirty-seven (50%) of the seventy-four recommendations have been implemented and thirty-seven (50%) are still in various stages of implementation, of which 27 were considered High Risk .
19% of the High Risk relate to systems security and processes that require upgrading of OASES. Expected implementation date is December 2007.
81% of the outstanding High Risk recommendations require improved operational processes. Those recommendations require implementation of a Business Continuity Plan, mapping of business functions, development of a staffing plan-including identification and classification of staffing needs supported by proper job classifications and job descriptions and more effective use of the performance contract mechanism.
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Board of External Auditors Determined that the Internal Control environment at the GS/OAS
was effective. Unqualified “clean” opinions were rendered. No material weaknesses were reported.
Significant amounts identified in OIG reports that were due to the OAS, have been reimbursed.
Several procedures were amended and/or developed to correct anomalies and strengthen internal controls, including: Specific Fund and Special Mission Handbooks Fellowships Manual of Procedures Recovery of Indirect Costs Financial and other Operational Processes
Results
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Other OIG Functions
OIG observes OAS meetings to evaluate the effect on the internal controls environment.
Inspector General meets with managers of the
General Secretariat to discuss issues that may impact internal controls and inherent risks, such as proposed business processes, review of draft procedures, implementation of recommendations and other areas of concern.
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Quality of Work – OIG carries out its audit activities in accordance with its mandate, rules and directives of General Secretariat and the Standards for the Professional Practice of Internal Auditing approved by the Institute of Internal Auditors (IIA). All professional staff members are members of IIA.
Independence - The Office of the Inspector General reports to the Secretary General and performs its functions with full technical autonomy and the broadest possible managerial autonomy.
Quality of Work and
Independence
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Staffing
Current Regular Fund OIG positions are: Inspector General – 1 P03 – 3 (two currently vacant)
P02 – 1 P01 (trainees) – 2
Audit Technician (G05) is paid from Specific Funds.
The OIG utilizes the CPR Mechanism as necessary to supplement resources.
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Board of External Auditors
The Board of External Auditors continues to express concern for inadequate OIG Staffing and recommends that additional resources be given to the Office of the Inspector General for audit oversight, training and peer review.
The Inspector General and the Department of Human Resources have submitted a Staffing Plan for consideration by management, as recommended by the Board.
Effect of Inadequate ResourcesLack of sufficient resources adversely affects, the timeliness of theaudit reports, as well as the audit coverage.
“Internal Control serves as the first line of defense in safeguarding assets and preventing and detecting errors.”
March 30, 2007 - Quote from the Board of External Auditors
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Inspector General’s Concerns
Data Integrity and Financial Reporting Systems Security Controls OASES upgrade IPSAS National Offices - OASES, Internal Controls Need to consolidate some Operational Processes to eliminate
duplication, redundancy and to promote cost effectiveness. Operational Policies and Procedures Staffing Needs and the CPR Mechanism The Implementation of ICR Process Project Management and Results-Based Performance
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2007 Work Plan Annex 3 of CP/doc. 4248/07
The OIG Work Plan focuses on areas of Significant (High) Risk and recommendations from the Board of External Auditors.
2007 Audit activities include: Risk assessment of the Payroll, Accounts Payable, Disbursement and
Procurement processes Accountable advances Inventory Petty Cash Systems Security Controls GS/OAS Office in Venezuela and Selected Projects GS/OAS Office in Suriname and Selected Projects GS/OAS Office in Guyana and Selected Projects GS/OAS Guatemala and Selected Projects GS/OAS Nicaragua and Selected Projects Selected projects managed by the Department of Sustainable Development
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To the Member States, the Secretary General and the General Secretariat for continued support to the Office of the
Inspector General.
To my team for their dedication, hard work and commitment.
OIG contact information
(202) 458-3468
Hotline
202-458-6888
202-458-3757 (fax)
Thank You
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Questions?