HD41 - Inspectors General / State Internal Auditor

Executive Summary:
This study was divided into three areas, Department of the State Internal Auditor, the Inspector General of the Department of Correctional Education, and the Inspector General of the Department of Corrections.

Department of the State Internal Auditor

On July 1, 1995, the operating budget for the Department of the State Internal Auditor was significantly reduced. As a result, the department reported in its biennial report to the Governor for the period July 1, 1993 through June 30, 1995, that "...These staffing levels do not permit the agency to carry out all of its statutory responsibilities in the Code of Virginia, § 2.1-234.32." (*1)

The internal audit function is important in maintaining public confidence in the government's ability to self-regulate. Virginia's internal audit program was considered excellent during 1991 and 1992. (*2)

The majority of the department's resources are currently used in conjunction with the operation of the State Employee Fraud, Waste and Abuse Hotline. The Auditor of Public Accounts recent analysis of this function stated the necessity for maintaining its operation. The analysis did express concerns over placement of the hotline and its overall scope of operation.

Recommendation 1: The Department of the State Internal Auditor performs a needed and vital function to the Commonwealth. The internal audit function should be preserved, and additional funding/staffing would be needed to permit the Department to perform mandated duties.

Recommendation 2: The scope of the State Employees Fraud, Waste and Abuse Hotline should remain to report allegations within state government only. Inspector General of the Department of Correctional Education. The office of the Inspector General of the Department of Correctional Education technically does not exist. The position is identified by the state as "Confidential Assistant Policy/Administration." The duties performed by this individual are considered crucial by the Superintendent to the continued effective operation of the department. This position is not codified as is the position in the Department of Corrections, nor should it be. Ultimately, the responsibility for the control and security of persons entering both adult and juvenile correctional centers rests with those agencies. The Department of Juvenile Justice does have need of an "Inspector General", of similar makeup, authority and responsibility, as that of the Department of Corrections. The Departments of Correction and Juvenile Justice must have the ability to conduct internal investigations and the ability to screen and control all persons entering their facilities.

Recommendation 1: A position of Inspector General should be created for the Department of Juvenile Justice. This position should also be given identical powers and authority to that of the Inspector General for the Department of Corrections.

Recommendation 2: The Department of Correctional Education should be permitted to retain its current position of "Confidential Assistant Policy/Administration", with its accompanying position description, with the exception of changing its working title of Inspector General to some other title that more appropriately describes job duties.

Inspector General of the Department of Corrections

The office of the Inspector General is divided into four functional areas. The Absconder/Extradition Unit, the Internal Affairs Unit, the Background Investigations Unit and the Staff Inspections Unit. Recently, in response to internal audit staff concerns over the freedom or independence to conduct what audits they felt were necessary, the internal audit function was relocated under the Director's office to allow for direct reporting.

All four units within the Inspector General's office have impressive operational statistics. However, during the course of the study, a number of areas of concern surfaced. They were, internal auditing practices, capital construction, and staffing. Even though the internal auditing function has been moved for the Inspector General's office, staff felt it was important to mention that, to date, the internal audit function has failed to follow the departments risk assessment models that identify where audits need to be performed.

Capital construction caused concern when it was learned that the department was paying for work to be corrected that had originally been improperly done under the original construction contract. In addition, final payments were being made and performance bonds released while there was still disagreement on satisfactory completion of some projects.

Staffing for the Inspector General's office is now a problem because of its workload, and will continue to get worse. Several programs have been implemented to attempt to stem the flow of contraband into the prison system. To date, these programs have met with significant success, and they should be continued. The Code of Virginia, Section § 53.1-16, limits the number of sworn members of the Inspector General's staff to fifteen. This section should be amended to allow for the increased workload, which should be performed by sworn personnel.

Recommendation 1: The Department of Corrections should ensure that high-risk areas as identified by the risk assessment model are audited with priority being given to the top five ranked risks.

Recommendation 2: The Department of Corrections should ensure that engineers from its Planning and Engineering section and the Building and Grounds supervisor for the new facility, are on-site at the start of construction and throughout to verify that the work performed is what was specified.

Recommendation 3: The Department of Corrections should ensure that no work is signed-off by on-site DOC personnel as being completed unless it has been visually verified by on-site DOC personnel.

Recommendation 4: The Department of Corrections should ensure that no funds are released for work not completed in accordance with all plans and specifications. In no event should a final payment be made or a performance bond released while there is disagreement over the satisfactory completion of a contract.

Recommendation 5: The Department of Corrections should promulgate policy that clearly states that all case files, documents, and records generated by the Inspector General's office are the property of the Department and may not be removed, secreted or destroyed except in accordance with the state Records Retention Schedule.

Recommendation 6: Section § 53.1-16., of the Code of Virginia should be amended to increase from fifteen (15), to thirty (30), the number of sworn members of the internal investigations unit of the Inspector General of the Department of Corrections.

Recommendation 7: A study should be conducted to determine the feasibility, cost effectiveness, and need for an office of the Inspector General of Virginia. This study should include recommendations on organizational structure (i.e., to whom this office reports), and an analysis of what methods, if any, are used by other states.

Recommendation 8: A House Joint Resolution should be drafted directing that Virginia State Crime Commission to continue this study as it pertains to the reporting structure of the Inspector General of the Department of Corrections and to follow-up on capital construction issues raised in the course of this study.
(*1) For Section §2.1-234.32, of the Code of Virginia, see Appendix B.
(*2) Financial World magazine, recognizing Virginia's full internal audit program in its "ranking pluses" in connection with naming Virginia as the "Best Managed State", for both years.