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11/28/2017
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Support Education License Tag Program Audit Prep
November 28, 201710:00 – 11:00 am ET
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Your Participation
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About the Consortium of Florida Education Foundations
Mary ChanceCFEF Presidentwww.educationfoundationsfl.org
Today’s Speaker
Cindy FernaldOffice of the Inspector General
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WELCOME
• Welcome
• Motorist Services Contacts and Resources
• Inspector General (IG)– IG Role
– IG Audit Process
– Common IG Audit Findings/Observations
• Questions and Answers
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Meeting AgendaSupport Education Specialty License Plate (SLP)
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Florida Educational License PlateParticipants in the SLP Program
• Department of Highway Safety and Motor Vehicles (DHSMV)
– Division of Motorist Services
– Office of the Inspector General
• District School Boards
• Public School Foundations
• Direct Support Organizations
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Division of Motorist Services
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Responsible for the day‐to‐day operation
of the SLP program.
Division of Motorist Services
Bureau of Issuance Oversight
(850) 617‐3001
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Motorist Services ‐ Specialty License Plate and Voluntary Contribution Section
Motorist Services – Roles and Contacts
– Creation, redesign, and probation
• Paula Stanfield ([email protected])
– Desk audits/reviews of annual attestations and single audits
• Jeanette Collins ([email protected]) – Verifies reported information against Florida Statutes
– Requests additional documentation as needed
– Identifies common errors/problems in reviews
– Referral to Inspector General’s office as needed
– On‐site monitoring; technical assistance
• Brittany Close ([email protected])
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Required Notifications to Motorist Services
• Provide immediate email notice to Jeanette Collins for:
– Discontinuation of organization or services offered
– Funds transferred to another entity
– Changes in:• Organization name
• Fiscal year reporting
• Contact Information – email, phone, physical address
• CEO, Accountant, or Board Chair
• Contact Brittany Close immediately:
– Any known or alleged fraud, related to SLP
– Significant known fraud of the organization
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Website – Revenue Distributionhttp://www.flhsmv.gov/specialtytags/SLP.html
SLP SALES AND DISTRIBUTION REPORTS
Webpage ‐Motorist Services
http://services.flhsmv.gov/specialtyplates/
Report – Specialty License Plate Sales Report
Data ‐ Sales by county, day, month, year
Source: Florida Real Time Vehicle Information System (FRVIS)
Webpage – Bureau of Accounting Web Portalhttp://services.flhsmv.gov/specialtyplates/revenuedistributionpayments.aspx
Report – Revenue Distribution Payment Reports
Data ‐ Distributions by CSFA and revenue type (SLP)
Source – HSMV Accounting System (FAME)
Webpage – Florida CFO/Department of Financial Services Payments
http://flair.dbf.state.fl.us/dispub2/newvpymt4.shtml
Report – Vendor/Payee Payment Reports
Data ‐ Distributions by FEID, day, month, year
Source – Florida Accounting Information Resource System (FLAIR)
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All reports will be linked on the Specialty License Plate webpage
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Website ‐ Annual Reporting
• Affidavit Forms and Instructions
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http://www.flhsmv.gov/specialtytags/slpaudit.html
Website ‐ Guidance and Legal References
ReportingRequirementsTrainingAid.pdf
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FLORIDA STATUTES320.08056 (10,11)320.08058 (8)320.08062
Plus…
F.S. 215.97
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State Financial Assistance (SFA)Specialty License Plate
Section 215.97, F.S. (Florida Single Audit Act ‐ FSAA)
Applies to all SLP regardless of amount of funds received or expended for the following:
‐‐ Access to records ‐‐ Retention of Records
‐‐ Internal Controls ‐‐ Use of Funds
Each SLP is assigned a unique number in the Catalog of State Financial Assistance (CSFA). Include the CSFA # on: Agreements/grant awards/letters with subrecipients of SLP funds
Annual report to DHSMV, either the
Affidavit, or
Schedule of Expenditures of SFA (part of the state single audit)
https://apps.fldfs.com/fsaa/index.aspx
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CSFA76.023
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Office of the Inspector General
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Office of the Inspector General (IG)
• Office within DHSMV.
• Reports directly to DHSMV Executive Director.
• Office of Inspector General established in each state agency and authorized to review the agency’s programs. (F.S. 20.055).
• Responsible for promoting accountability, integrity, and efficiency in government.
• Audits conducted in accordance with:– International Standards for the Professional Practice of Internal
Auditing published by the Institute of Internal Auditors.
– Principles and Standards for Offices of Inspector General published by the Association of Inspectors General.
• Authority to examine records ‐ F.S. 320.08062(3) and 215.97 (8)(d)
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• Purpose ‐ Determine compliance with use of SLP funds (in accordance with statutes and policies)
• Scope – generally most recent or 2 years of data – will go back further in certain circumstances
• Methodology
– Planning
– Fieldwork
– Communicating Results
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Audits Conducted by DHSMV IG
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DHSMV IG ‐ Audit Methodology• Planning (Preliminary work)
– Initial contact with entity CEO – phone call
– Written engagement letter (email)
– Entrance conference (usually by phone)
• CEO, accountant, etc ‐ familiar with use of SLP
• Identify contact person
• Nature of expenses; related organizations
• Request records – general ledger and detail
• Public Records – “Sunshine Law”
• Schedule on‐site office visit
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DHSMV IG ‐ Audit Methodology
• FieldworkAfter off‐site review of preliminary records and sample selection:
– On‐site inquiries/review of supporting documentation:
• Services (contracts, billings) and Goods (invoices, receipts)
• Credit Card/Debit Card charges (receipts)
• Personnel (W2, timesheets, allocations)
• Distributions (statutory basis)
• Grants (proposals, awards, reports) – CSFA #
• Bank statements
– Communicate known issues before leaving siteConsider additional written and verbal information (if needed after on‐site review)
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DHSMV IG ‐ Audit Methodology
• On‐site coordination goal:
– Keys to a productive on‐site review: • documentation available – format (electronic/paper)
• knowledgeable contact person with sufficient authority committed to finalizing all outstanding issues
– IG may be in the geographic area for a couple of days if scheduled with other entities
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Efficient on‐site review for your entity and DHSMV IGMinimize time – Maximize Information
Communicate, coordinate, cooperate!
DHSMV IG ‐ Audit Methodology• Communicating Results (Reporting)
– Supervisor reviews audit work and draft report; findings and recommendations discussed with Motorist Services
– Exit Conference (by phone) with entity
– If findings are proposed:• Written ‘preliminary findings’ (email)
• Entity response and planned corrective actions due in 20 working days; included in audit report
– Final report provided to entity, Department staff, and available to interested parties
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Follow up audit to confirm entity’s corrective actionsFollow up audit to confirm entity’s corrective actions
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DHSMV IGAudit Findings and Observations
• Annual Report Filing – F.S. 320.08062– Affidavits not filed within 9 months of year end
• Early filing is OK. Coordinate with timing of 990 filings
– State Single Audits • If entity obtains a ‘single audit’, submit it to Motorist Services;
no affidavit necessary.
• Submit within 45 days after CPA sends single audit to the entity.
• Submit complete reporting package: Financial statements
Schedule of Expenditures of State Financial Assistance – list the CSFA# and amount. If no current year expenditures, explain in transmittal email to Motorist Services
Auditor’s reports, etc.
See Auditor General Rule 10.550 (local governments)or 10.650 (NPO)
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TIP
TIPTIP
DHSMV IGAudit Findings and Observations
• Marketing Allocation
– Allocation exceeded statutory limit permitted to spend less (or none)
– Allocation balance carried forward at year endNeeds to be expended in the current year.
Any balance can be used for program purposes in future years. (Note: ONLY program funds carry‐forward year to year)
– Classification of expenditures Separate identification/classification of marketing expenses
promotes compliance with percentage limit.
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DHSMV IGAudit Findings and Observations
• Marketing ‐ Documentation– Obtain and retain documentation evidencing use of SLP funds for promoting and marketing the tag contracts; agreements; invoices
– Arrangements with marketing providers ‐ describe services, deliverables, costs, and other terms
– Verification ‐ periodic reports or invoices evidencing scope, nature, and timing of marketing consulting services rendered prior to payment.
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MARKETING and PROMOTION relates to the tag; not to the entity or program
DHSMV IG Audit Findings and Observations
• Use of Funds
– Look to the STATUTE
• General concepts
• Good faith – planned; involved Board; documented
• Administrative/lobbying
– Enhancing educational programs• How does it enhance educational programs; describe it!
• Not limited by other grant conditions, agreements, etc.
• Consult with other districts, Consortium, Motorist Services
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DHSMV IG Audit Findings and Observations
• Documentation – may be disallowed if not documented
– Credit/Debit Cards – receipts
– Invoices, Billings, Agreements, Contracts
– Payroll Records
• Recordkeeping– Ledgers; Bank Statements; Check records
– Track/identify SLP expenses Know the SLP CSFA #
Disclose to CPA
• Internal Controls– Segregation of duties–initiate, authorize, record, reconcile, access, etc.
– Independent verifications – bank reconciliations, etc.
– Board involvement27
CSFA76.023
Expected Audit Methodology
• ALL
– Engagement Letter – Email
– Survey ‐ Email
• Limited number
– Phone Entrance Conference
– On‐site Visit
– No site visit; request certain documentation
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IG Contact Info
• Cindy Fernald, Auditor
– 850.617.3131
• Kyle Tolbert, Auditor
– 850.617.3173
• David Ulewicz, Audit Director
– 850.617.3128
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Keys to Ensuring the Trust of Donors and the Public
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Initial and Annual FilingsCurrent knowledge of regulatory requirements
SLP
Affidavitor
Single Audit
FS 617
Non Profit Incorporation Law
SunBiz – Annual Report
Articles of Incorporation; Bylaws
Governance; # of Directors; Minutes
Financial Records; Records Retention; Conflict of Interest
IRS
Tax exempt status
Annual filing – Form 990, etc
990 governance questions
FS 496
Public Charity Law
Initial registration statement
Annual renewals
Annual and supplemental financial disclosures
‐‐ 990, audit, form
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WhoWhatWhen
WhoWhatWhen
Board Key StaffAdvisors
Board Key StaffAdvisors
Internal ControlsWork environment with high regard for compliance and integrity
Process, effected by an entity’s board of directors, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives relating to operations, reporting and compliance.Source: Committee of Sponsoring Organizations (COSO)
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PROCESS PEOPLE
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Fraud Awareness and DeterrenceWork environment with high regard for compliance and integrity
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Source: Association of Certified Fraud Examiners
Keys to Ensuring the Trust of Donors and the Public
• Accounting System ‐ separate identification and reporting of SLP revenues and expenditures
• Adequate records retention – 5 years
• Adequate (clear and complete) invoice descriptions
• Timely and accurate filing of annual reports
• Continued familiarity of SLP compliance (including when staffing changes occur)– Program, marketing, prohibitions on admin/lobbying
– Florida Statutes, website, workshop
• Willingness to contact DHSMV staff with questions
• Integrated program, financial, leadership team (and CPA)
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Questions & Answers
Please use the chat box function to ask a question.
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Thank you for participating!
All registrants will receive a copy of the slides and a link to the video recording of this presentation by the end of the week.
CFEF ‐‐ Link to Today’s Webinar
11/28/2017
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Staying Informed with Free Resources During Session & Beyond
http://educationfoundationsfl.org/info-resources-hub
Save The Date: Upcoming Webinars
K‐12 Education – A Look Ahead to the 2018 Legislative Session
Tuesday
December 12
3:00 – 4:00 pm ET
Register Here
11/28/2017
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Maximizing the individual and collective strength of Florida local education foundations to support
local partners and schools.
Mary Chance, PresidentOffice: 352-338-0250 | Cell: [email protected]
www.educationfoundationsfl.org
