Annual Report and Work Plan 2001

7/30/2019 Annual Report and Work Plan 2001

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Office of Inspector General

Annual Report and Work Plan


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TABLE OF CONTENTS

Introduction

Mission of the Office of Inspector General ........................................................ 2

Historical Overview ............................................................................................ 2

Organization and Staff ........................................................................................ 3

Summary of Major Activities

External Audit ..................................................................................................... 6

Internal Audit .................................................................................................... 10

Investigations .................................................................................................... 16

Best Practices..................................................................................................... 21

Other OIG Activities .......................................................................................... 21

2001-2002 OIG Work Plan ............................................................................... 23

Appendices ............................................................................................................ 33


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OFFICE OF INSPECTOR GENERALANNUAL REPORT FORFISCAL YEAR2000-2001

2

The Departments Office of Inspector General (OIG) is statutorily assigned

specific duties and responsibilities for its audit and investigation functions. Section 20.055(2), F.S., requires the appointment of an Inspector General by the agency head and specifies the

Inspector Generals responsibilities.

The OIGs responsibilities include advising in the development of performance measures,

standards, and procedures for the evaluation of agency programs; reviewing actions taken by the

agency to improve program performance and meet program standards; providing direction for

and coordinating audits, investigations, and management reviews relating to the programs and

operations of the agency; recommending corrective action concerning fraud, abuses, and

deficiencies; reporting on the progress made in implementing corrective action; reviewing rules

relating to the programs and operations of the agency; and ensuring that an appropriate balance is

maintained between audit, investigative, and other accountability activities.

Included in the statute is a requirement that the Inspector General furnish the agency head an

annual report by September 30 summarizing the activities of the OIG during the immediate

preceding state fiscal year.

The OIG also performs duties unique to the Department as set forth in Section 20.23(3)(h), F. S.

This statute includes specific duties such as reviewing major parts of the Departments

accounting and Central Office monitoring functions, assessing the Departments management

information systems, and performing audits of contracts and agreements between the Department

and other public or private entities.

The OIG assists the Department in accomplishing its mission by providing

independent review, assessment or investigation of Department activities

and programs. The OIGs mission is to promote integrity, accountability,

and process improvement in the Department. Our vision is to be key and

indispensable players on the Departments team.

The term inspector general has been historically associated with

maintaining and improving the operational efficiency of our nations

armed forces. In the 1970s, Congress adopted the idea and created civilian

inspectors general to address fraud, waste, abuse, and corruption in federal

agencies.

An audit function was established in the Department in the 1960s. This function evolved into

audits and investigations and in the 1980s was designated the Office of Inspector General. In

1994, amendments to Section 20.055, F. S., required an Office of Inspector General in each state

agency.

MissionStatement

HistoricalOverview



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OIG employee task teams recommended the OIG be re-engineered to

better align our resources with the Departments changing business

environment. Three of the more visible areas in need of consideration

when deciding to employ our resources were the Departments Strategic

Plan and Strategic Objectives, Claims and Supplemental Agreements, andPrivatization. A role for the OIG was identified relating to three of the

Departments Strategic Objectives:

Percent of Avoidable Supplemental Agreements,

Percent of Avoidable Time Charges; and

Percent of Key Processes with Control Systems in Place.

Considering its role in assisting the Department in achieving its strategic objectives, the OIG

assessed the offices functional structure and staffing. In order to more effectively carry out the

duties and responsibilities of the Office, in FY 2001 the OIG reduced its organization from five

operating functions to three operating functions. The three functional areas created were:

External Audit, Internal Audit, and Investigations. This realignment allowed us to develop teams

to better focus on our objectives, reduce our staff size and position the OIG to be key and

indispensable.

Our audit of Construction Contract Claim Settlements drew attention to the need for greater OIG

involvement with claim settlements. To achieve this, a Construction Services Unit was

established within the External Audit Function. The unit was charged with the review and

evaluation of contract modifications and construction claim packages and included the

performance of quality assurance reviews of the construction contracting process. This unit was

formally established in December 2000 and was fully staffed by May 2001.

Within the Internal Audit Function, we evaluated our statutory responsibilities identified in

20.055, F. S., and determined that a greater emphasis needed to be placed on the Departments

financial management systems. Based on our evaluation, a Financial Services Audit Section was

established within Internal Audit. Organizationally, the Financial Services Audit Section was

established in December 2000. In July 2001 staff members were hired and the Financial Services

Audit Section began operations. This section has responsibility for reviewing major parts of the

Departments accounting systems and for assisting the Department with financial analysis of

programs and areas of concern.

These new activities have positioned the OIG to continue to serve our external and internalcustomers as key and indispensable elements of the DOT team.

Privatization increased during Fiscal Year 2000-2001. As the Department contracts out more of

its activities, the OIG incorporated more oversight of prioritization activities within our new

organizational structure and modified our annual work plan to be a key partner in the

Departments oversight activities.

OIGOrganization

and Staff


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To accomplish our goals, personnel resources were allocated as shown in the graph below:

Staff Resources

Investigations

8 External Audit

19

Internal

Audit

16

The broad objective of each of these functions is described below:

Internal Audit: This function provides independent appraisals of the performance of

Department programs and processes, including the appraisal of managements performance in

meeting the Departments information needs while safeguarding its information technology

resources.

External Audit: This function ensures that costs proposed and charged to the Department

through contracts and agreements with external entities are accurate and reasonable and comply

with applicable federal and state procurement regulations.Investigations: This function works to deter, detect and investigate crimes or misconduct

impacting the Department.

Special Projects: This section assists the OIG in developing systems and reviewing processes

for office production and administration.

During FY 2000-2001, the OIG issued reports by functional area

as follows:

Function No.

External Audit 267

Internal Audit 104

Investigations 150


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To achieve our mission, the OIG has a staff of 46

professional/technical positions and 3 administrative and support

positions. Our organizational structure is as follows:

Andra P. Higgins

Support Services

N. Joe Peet

Special Projects

Lisa L. Evans

External Audit

Marlys J. Eichhoefer

Internal Audit

Robert E. Clift

Investigations

Cecil T. Bragg, Jr., C.P.A.

Inspector General

Thomas F. Barry, Jr., P.E.

Secretary

Technical expertise within the OIG covers a variety of disciplines with

employees being technically qualified in auditing, accounting, engineering,

investigations, legal, and information systems. Staff members continually

seek to augment their professional credentials, further enhancing their

abilities and the contributions they can make. Staff members participate in

a number of professional organizations to maintain proficiency in their

certifications and profession.

Certifications No.

Advanced Degrees 13

Certified Fraud Examiner 5

Certified Government Financial Manager 4

Certified Information Systems Auditor 5

Certified Inspector General 2

Certified Internal Auditor 6

Certified Public Accountant 9

Certified Management Accountant 1

OrganizationalStructure

OIG StaffCertifications


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The External Audit Section performs audits, reviews, and special analyses

to ensure that costs charged to the Department by consultants, contractors,

and other external groups are accurate and reasonable, and comply with

applicable federal and state procurement requirements. Department

managers request a number of the audits. Staff schedules these audits and

reviews to optimize the efficiency and effectiveness of audit resources forDepartment contracting operations and to maximize audit coverage of

agency risk.

A summary of the major activities of the External Audit Section is reflected in the following

table:

Audit/Review Type No. AmountQuestioned

Costs

Construction Claim Reviews 10 $22.2M $ 6.0M

Preaward Reviews 177 381.0M 1.4M

Consultant Final Audits 39 79.0M 0.3M

Rail Audits 2 8.1M 0.5M

Special Project Audits 39 ----- ----

Total 267 $490.3M $8.2M

During FY 2000-01, the External Audit Section issued 267 reports covering over $490.3 million

of actual or proposed costs. These audits resulted in approximately $8.2 million in questioned

costs. This 241% increase in questioned costs from the prior year is due primarily to

emphasizing reviews of contractor claims. Contract auditors within the External Audit Section

also reviewed the accounting systems of 19 consulting firms applying to do business with the

Department and completed 28 other audits or reviews of various types.

The External Audit Section expanded its involvement in special projects. Staff members were

involved in not only Department special projects but also projects with the Federal Highway

Administration, and the Transportation Research Board.

The External Audit Section also participated in training and outreach both within the Department

and within the consultant/construction industry. This included participation in industry forums,

presentations at conferences, participation in process improvement task teams, and trainingprograms for Department personnel. These efforts were intended to enhance communication and

understanding between the Department and its business partners and to result in continuous

process improvement.

ExternalAudit


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Following are highlights of some of the audits, reviews, and special

projects completed during the past year.

Construction Claim Reviews: These reviews determine whether elements within claims areconsistent with project records and justified based on federal and state rules and regulations,

contract provisions, and accounting standards. Elements reviewed generally include contractor

job-site and home-office overhead, as well as equipment rental or ownership costs. During the

second half of FY 2000-01, we completed 6 reviews covering $8.9 million and questioned $6

million. We also reviewed 4 claims covering $13.3 million and were unable to reach a

conclusion of entitlement and/or value due to insufficient contractor documentation.

Consultant Preaward Reviews: These reviews determine if consultant cost proposals arereasonable and comply with federal and state procurement rules and regulations. During FY

2000-01, 177 consultant preaward reviews were conducted covering $381 million in proposed

contract costs. These reviews resulted in approximately $1.4 million in questioned costs. Also,during FY 2000-01, the Florida DOT Preaward Review Process was revised. In order to improve

the efficiency and effectiveness of the Preaward Review Process, the mandatory ceiling amount

for the selection of reviews was increased and the sample selection method was changed. The

External Audit Section will continue to do Preaward Reviews from each district; however, the

concentration will be placed on the areas of risk based on a three-year history. Although the

number of Preaward Reviews will be reduced, the cost coverage should not be reduced.

Consultant Final Audits: These audits determine whether costs billed to the Department arereasonable, in accordance with contract provisions, and in compliance with federal and state

procurement requirements. Our audit coverage includes contract cost data that provides district

and Central Office officials better information for future contract negotiations. External Audit

staff provided useful information in this area, especially where lump sum contracts were

involved and the scope requirements were not well defined. During FY 2000-01, we performed

39 final audits covering $79 million. This resulted in approximately $.3 million in questioned

costs and a number of recommendations implemented to improve job cost accounting systems,

which is vital for accountability of incurred costs.

Accounting System Reviews: These reviews determine whether a consultants accountingsystem appears adequate to accumulate and record costs in a job cost method that allows for

accurate billings to the Department. During FY 2000-01, 19 on-site accounting systems reviews

were performed. This area continues to be a significant part of the External Audit Sectionsworkload due to the interest that new consultant firms have in doing business with the

Department.

Rail Labor Additive Rates: These audits determine if elements of rail companies laboradditive rates are reasonable and allowable. We completed two Rail Labor Additive Rate audits

during FY 2000-01. Of the two, one involved one of the largest railroads in the country. The

audited rates are used by 20 other state DOTs.

ExternalAuditHighlights


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Department Billing Rate Development: These audits are performed to determine if costallocation methods are reasonable and comply with federal regulations for billing to federal and

state-funded projects. During the year, we completed two audits of the Departments cost

allocation plan and one of the State Materials Office rates.

The graph below depicts personnel resource utilization during FY 2000-01:

External Audit PTO Programs11%

Consultant

Preawards

23%

Special

Projects

12%

Construction

Services

21%

Consultant

Finals

33%

Requests for audit assistance outside External Audits standard areas of

coverage continued to be significant during FY 2000-01. The requests ranged

from assisting the Federal Highway Administration (FHWA) in a review of the

Federal indirect billing, working on a synthesis study of highway practices with

the Transportation Research Board, and participating on a Quality Financial

Management Improvement Project with the Federal Highway Administration

(FHWA) in developing an overhead audit guideline book that is to be adopted

nationwide by American Association of State Highway Transportation

Officials (AASHTO).

We also participated in a Claims Task Team to evaluate and recommend improvements to the

claim settlement process based on recommendations from the OIGs audit of Construction Claim

Settlements. The task team included personnel from the Office of Construction, the General

Counsels Office, and the districts. The team recommended a series of changes to the

Construction Project Administration Manual (CPAM). The recommendations were accepted and

the CPAM was revised in the Spring of 2001.

The External Audit Section performed quality assurance activities in three

areas during the year. These areas were the consultant contract award

process, district rail review process and the single audit review process.

In accordance with our preaward sampling agreement with the Departments eight districts, wereviewed the consultant negotiation process in each district on preaward requests not statisticallyselected for review. The districts were generally following the preaward requirements.

The primary purpose of the district rail invoice reviews was to determine if adequate information

was provided so the Department could reasonably verify incurred costs. This review indicated a

systemic weakness in the methods used by the districts to review rail invoices.

OtherExternal Audit

Activities

Quality

Assurance


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In accordance with the recipient/subrecipient single audit procedure, we performed quality

reviews on the single audit review process of each district and provided related training. Federal

funding for many of these projects flowed through the Department to the recipients and the

projects were covered by the requirements of the U.S. Office of Management and BudgetCircular A-133.

We also assisted the Investigations Section on assignments where actual Consultant costs on

agreements were needed and financial evaluations were necessary.


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The objective of the Internal Audit Section is to provide an independentappraisal of the adequacy and effectiveness of the Departments processand control system and the overall quality of the system's performance.Internal auditing furnishes top management with analysis, appraisals,

recommendations, counsel, and information concerning the activitiesreviewed.

Internal audits encompass financial, information technology and operational activities. TheInternal Audit Section provides Department managers with Assurance Services (auditing),Computer Forensic Services, Consulting Services, Performance Measure Assessment andProcedure Reviews.During FY 2000-01, we completed six major audits, nine major Information Technology

Resource (ITR) reviews, 10 minor ITR reviews, and nine offices were provided consultant

services. Additionally, the 26 Performance Measures and 47 proposed Performance Measures

were assessed. The results of the units work are grouped by the type of service provided.

Assurance services are the review of the control processes designed bymanagement to assure the reliability and integrity of information,compliance with policies and regulations, safeguarding of assets,economical and efficient use of resources, and achievement ofestablished operational goals and objectives.

Norton AntiVirus Compliance Audit (10B-0006): The purpose of this audit was to evaluate

controls established to prevent and/or detect the presence of viruses and determine compliance

with anti-virus requirements. The audit included all districts, the State Materials Office and the

Office of Toll Operations. The audit encouraged management to develop and implement a

comprehensive anti-virus process with the objective of ensuring appropriate enterprise-wideprotection.

Acquisition and Use of Information Technology Consultants Audit (140-0029): The primary

objective of this audit was to evaluate the internal control structure for acquiring and using

Information Technology (IT) consultants. This audit was planned and conducted concurrently

with six other agencies, in coordination with the Chief Inspector General, Executive Office of the

Governor. We determined the Department awarded some contracts without approved

Information Resource Requests (IRRs) and did not establish adequate management controls to

monitor Minority Business Enterprise (MBE) contracts. The Departments senior staff agreed

with our recommendations which included revision to the Acquisition of IT procedure to require

all IRRs be submitted to the Departments Central and district information services offices, andstrengthen internal control practices to ensure the MBE contract award population is identified,

monitored and reported.

Alternative Contracting Methods Audit (04B-0001): The objectives of the audit were to

determine whether alternative contracting methods were working and if the program could be

improved. An analysis of 51 centrally let and completed alternative contracts showed the

alternative contracts were completed in less time and with fewer cost overruns than the other 357

completed construction contracts for FY 1998-99. CEI contract costs in the sample were 4.5

InternalAudit

Assurance ServicesAuditing


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percentage points lower than the average CEI costs for all contracts in FY 1998-99. However,

the Department could improve the alternative contracting program by 1) developing standardized

formulas for Bonuses and Incentives/Disincentives; 2) establishing more consistency in criteria

used to select projects for alternative contracting; and 3) pursuing adoption of proposed revisions

to eliminate the step guidelines in Section 14-93.003, F.A.C.

Local Area Network Backup Audit (10E-0001): The purpose of the audit was to evaluate

compliance of the Offices of Information Systems (OIS) and Computer Aided Drafting and

Design (CADD) offices with Department LAN Backup requirements. The audit included OIS in

all districts plus the State Materials Office and the Office of Toll Operations (10 OIS offices).

The audit also included CADD offices in all districts and the State Materials Office (9 CADD

offices). Most district offices visited had implemented steps to regularly backup pertinent data

on LAN servers; however, half of the district offices did not comply with off-site storage

requirements. Also, most offices had not fully complied with Department procedures for

documenting local backup processes.

Program Change Management Audit (10D-0002): The purpose of the audit was to evaluate

controls for moving application software and databases from test to production. The intent of

these controls is to prevent untested, defective, or improper versions from being introduced into

production libraries. The audit included legacy mainframe, Web enabled, and client/server

applications. The audit disclosed that each project area had developed procedures in various

forms to ensure only properly tested and approved changes are introduced into the production

environment. However, the Department had not developed a standard method for promoting

software from test to production.

Cost Distribution to Work Program Projects-Full Job Costing (09L-0005): The objective of

the audit was to determine if District-wide and General Consultant costs could be tracked to theircomponent projects. We concluded that Department financial systems are not being used, except

in limited cases, to track these costs to their component projects. As a result, financial systems do

not fully reflect what it costs to complete a project. Financial systems detail what it costs to

complete the contract, not the projects. The Departments senior staff agreed with our

recommendation that a task team be appointed to evaluate the cost benefit of, and potential

criteria for, full job costing of District-wide and General Consultant contract costs.

Computer Forensic ServicesInformation Technology Resource (ITR) Compliance Reviews are

conducted using computer forensic techniques. The purpose of these

reviews is to determine if statutes, Department rules, and Department

procedures concerning the use of ITR have been followed.

Management uses these reports to take appropriate personnel action that

ranges from counseling sessions to employee termination.

The resources devoted to computer forensic services continue to increase. The purpose of these

19 reviews was to determine if State statutes, Department rules, and Department procedures

concerning the use of ITR were violated. Computer forensics services were provided to OIS,


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OTO, MCCO, Environmental Office, State Construction Office, State Materials Office, Roadway

Design, and Districts 4, 5, 6, and 7. Management took appropriate personnel action that ranged

from counseling sessions to employee termination.

The process for performing Consulting Services is much the same asconducting an audit. The difference is the focus of the engagement.

Audits are traditionally conducted after the fact and report on what went

wrong whereas consulting services occur prior to or concurrent with an

activity and provide more timely information to management to make

proper decisions and avoid costly mistakes which may expose the

Department to risks (financial, legal, public perception, etc.). These

engagements are referred to as Proactive Auditing.

Finance & Administration

Direct vs. Indirect Cost Trends Memorandum (140-0026): In this memorandum we analyzed

the trends in Direct Cost and Federal Reimbursement over a four-year period. This analysisshowed that the only meaningful trends were at the district or functional area level. The detailed

trend results were provided to management and action thereon is expected.

Office of Comptroller

P-Card/Travel Voucher Reconciliation: This memorandum covered the ability of the

Disbursement Operations' review of charge card receipts attached to travel reimbursements to

identify fraud, waste, and abuse; Disbursement Operations' identification of high-risk

transactions, making certain types of travel transactions mandatory for Purchasing Card (i.e., air

fare), statistical sampling issues, and follow-up work on identified areas of concern. We

concluded that the Department has a unique opportunity to use the Purchasing Card for travel.

This use will shift the responsibility for travel-related payments from the employee to the

Department. If properly implemented, the Department can expect to gain a number of benefits

including alleviation of the need for travel advances and associated administrative processes.

Office of Information Systems/State Technology Office

Risk of Outsourcing Information Technology Functions Memorandum (10A-0002a): This

memorandum summarizes risks associated with converting the Departments technology

environment from in-house to out-sourced and provides some ways to mitigate or minimize those

risks.

Telemate.net

NetSpective

Proxy Reporting Tool Installation (10B-1003): Thismemorandum advised management of the OIGs monitoring of the Security Administrations

installation of Telemate.net NetSpective for COs Microsoft Proxy reporting tool.

Windows 2000Active Directory Services (10E-0003):Memorandums addressing contractor

selection and naming conventions document and project scope were provided to the OIS team

determining the Department active directory structure. The Active Directory Structure is

awaiting STO approval. We are currently assisting with the development of test plans for the

various designs options.

ConsultingServices


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Business Impact Analysis Survey (10B-1004): This memorandum summarizes our review of

OISs survey and provides recommendations regarding Critical Business Functions, Software or

Procedural Changes, Contacts and Funding.

Lotus NotesPrivate E-Mail Usage (10J-1011): This memorandum disclosed that use of privateelectronic mail accounts to conduct Department business circumvents Department policy and

recommends management consider the risks involved.


Construction Contract Audit Hooks (10G-1002): This project developed reports for retrieving

contracts in a cost or time over-run condition from the Departments Contract Reporting System

for use by the OIG Construction Contract Claims Audit Section.

Internet Usage Audit Hooks (10E-1003): Issued memorandums providing OIG management

Netspective Reports detailing Internet activity of office employees.

Assistance to Investigations District 7 (10J-1010): Retrieved and provided information

obtained from the employees hard drive and e-mail.

Assistance to Performance Audit District 4 (10J-1016): Reviewed materials distributed by a

District 4 employee and found no violation of Department policies.

State Maintenance Office

Motor Vehicle Usage: The purpose of this assignment was to analyze the motor vehicle usage

report completed by the State Maintenance Office (SMO) in accordance with Section 287.17(5),

Florida Statutes, and reported to the Office of Program Policy Analysis and Government

Accountability (OPPAGA). We completed a limited assessment of the report and concluded that

the SMO used reasonable methodology in conducting their review. We also concluded that

while the report issued by the SMO contained some inaccurate vehicle data, the inaccuracies

were not significant.

Districts

Miami Intermodal Center (MIC): District 6 The MIC is a $1.3 billion project that will be

similar to a Grand Central Station offering various forms of transportation. Scheduled for

development in several phases, the first phase of the MIC will include roadway improvement

projects and a consolidated rental car facility. The MIC Core, a transportation hub where local

and regional transportation will converge, will also be included in Phase I. The OIG will monitorthe progress of the MIC. Based on this work, the OIG will perform specific audits, reviews, and

other services to evaluate aspects of the project.

District 4 Complaints (140-1001): The OIG issued a series of letters related to allegations of

retaliation, irregularities, illegal acts and mismanagement in the Department. None of the

allegations proved to be founded.


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District 7 (10J-1019): Assisted the District CADD Manager in obtaining hard drive information.

District 2 (10J-1015): At the request of District 2 management, provided Netspective Reports

detailing Internet activity for a district employee.

Section 20.055(2)(b), F.S., requires that Inspectors General assess

the reliability and validity of the information provided by their

agencies on performance measures and standards identified under

the performance-based program budgeting process.

Performance Measures Validity and Reliability (07D-1008): This report

fulfilled the Inspector Generals statutory responsibility to assess the reliability

and validity of the information provided for the 26 approved Department Fiscal

Year 2000-2001 performance measures and standards. The reliability and

validity of the 47 proposed performance measures for Fiscal Year 2001-2002

were also assessed.

The purpose of procedure reviews is to ensure integrity, accountability, and

process improvements are addressed in Department procedures. A properly

conducted review will provide management assurance that:

The intent of the document is clearly identified;

The procedure is clear, concise, well-written, and functional;

Associated documents are appropriately referenced;

The procedure identifies, communicates, and prioritizes desired outcomes

of the process.

The primary concern of the OIG in reviewing these documents is the presence of internal

controls, evidence of an adequate audit trail, and consistency of procedures throughout the

Department. Forty-four Department procedures were reviewed during the year.

Established the Financial Services Audit section within the Internal

Audit function.

Verified Corrective Actions

Developed Mission/Vision Statement

Prepared Audit Resumes for staff

Refined the Audit Process Established Team Audit Review Process (TARP) as Standard

PerformanceMeasure Assessment

ProcedureReview

Other Internal

Audit Activities


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The graph below depicts personnel resources utilization during FY 2000-

01.

Personnel Resource Uitilization

Planning

6% Construction

13%

Information

Systems

45%

Financial

Management

21%

Admin/Support

Services

4%

Performance

Measures

3%

Special Projects

8%


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The mission of the Investigations Section is to deter, detect, and investigate crimes or misconduct

impacting the Department.

The Investigations Sections primary objective is to aggressively pursue any

attempt by Department employees, members of the public, contractors,

subcontractors, or intermediaries to gain financial or other benefit to which they

are not properly entitled in their association with the Department. Awareness

briefings, referrals of minor allegations to management, and substantive

investigations are methods used to accomplish this objective. The section also

investigates allegations of employee misconduct. Employee misconduct

investigations typically involved reports of conflict of interest, theft, and improper

use of Department resources.

The Investigations Section opened 149 new cases, closed 148 ongoing or

new cases, and forwarded 47 incomplete cases into FY 2001-02. For the

majority of cases initiated in FY 2000-01, allegations centered on

employee conduct standard violations; however, 28 of these cases alleged

procurement fraud victimizing the Department. In 26 of the 148

completed cases, the allegation was classified as proved, and

administrative sanctions from reprimand to termination were imposed.

Most significant employee misconduct investigations are conducted exclusively by the

Investigations Section. However, Florida law requires that Inspectors General notify law

enforcement authorities whenever a criminal law violation is believed to have occurred. Rather

than merely meeting the statutory responsibility for notification, the Investigations Section

proactively solicits assistance of law enforcement and prosecutorial agencies for involvement in

cases that impact the Department. Once partnerships are established, the investigation proceeds

jointly to a logical conclusion with OIG investigators and law enforcement agents working side-

by-side with prosecutors.

This approach is beneficial for several reasons. First, the Department itself actively pursues

cases involving the protection of State Transportation Trust Fund dollars. Secondly,investigators who are familiar with functions and personnel in the Department can most

effectively uncover investigative details within the Department. Thirdly, major events planned in

any case, such as near-term indictments or arrests, can become known at the proper time to the

Departments senior managers before they become headlines in the press. Finally, Department

managers in a position to correct weaknesses in internal processes can act promptly as a result of

details uncovered as a part of a criminal investigation. As evidence of the success of partnering,

this year the Investigations Section has continued to pursue cases jointly with criminal justice

agencies such as the Florida Department of Law Enforcement, and prosecutive agencies such as

the United States Attorneys Office, the Office of Statewide Prosecution for crimes such as grand

Investigations Deter Detect Investi ate

Case Loadand

Distribution


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theft, money laundering and organized schemes to defraud.

To most effectively utilize the limited trained and experienced staff, substantive cases have

emphasized procurement fraud matters where there is the greatest need for specialized

investigative expertise.

The following table depicts case distribution across organizational elements by number of cases:

*(Central Office includes the Motor Carrier Compliance Office and Tolls)

Case types are assigned to an investigation at the intake stage and dictate

the process used to resolve the allegation. Examples of case types are

substantive initiation, referral to management, and memorandum for

record. Case categories are also assigned to an investigation at the intake

stage. These describe the kind of allegation that is being made. Examples

of case categories are contract fraud, misconduct, and theft of property.

FY 2000-01 Case Distribution

DistrictCarriedForward

InitiatedFY00-01

TotalActive

CompletedFY00-01

Forward toFY01-02

1 3 3 6 1 5

2 2 20 22 20 2

3 12 13 25 21 44 4 18 22 16 6

5 3 13 16 11 5

6 3 9 12 9 3

7 7 12 19 16 3

Turnpik 0 2 2 2 0

CO* 8 44 52 39 13

Statewide 4 15 19 13 6

Total 46 149 195 148 47

Case Type andCase Category


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The following charts depict FY 2000-01 cases spread across type and category by number of

cases:

Case Type External

Larceny byFraud 5

InternalLarceny by

Fraud 2

Workplace

Violence 2

Contract

Fraud 28

Improper

Use/Diversion

of Resources

11

Misconduct

56

Theft of

Property 11

Awareness

Briefing 29

Other 5

Case Category

Substantive

Case 45

Prleiminary

Inquiry

3

Request forAssistance

5

Monitor Case

1

Memo for

Record

63

Referral to

Management

32

The Investigations Section continued their objective of presenting fraud

and employee misconduct awareness briefings to Department personneland industry partners. Over 4,000 people received indoctrination into

fraud and ethical awareness presented around the state by investigators

traveling in the completion of their other case related responsibilities. As

a corollary benefit, these briefings keep the OIG forward in the thoughts of

Department personnel who can then call on the OIG for audit or

investigative services.

Fraud andEmployee

MisconductAwareness


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White Construction Company, Inc., (WCC): WCC won bids on threeseparate but adjoining projects on Interstate 75 in Marion County, Florida,

valued at $34 million. The projects were to increase four lanes of traffic to

six lanes of traffic. After completion, WCC filed a $30 million suit

against the Department for additional work and associated delays. In

January 1998, just before the civil trial, WCC and the Department settled

for $6.875 million. This joint investigation by the OIG, the Florida

Department of Law Enforcement (FDLE), and the USDOT OIG disclosed

that portions of the additional work claimed to have been performed by

WCC had not been completed at all and the value of some work that had

been completed was billed two and three times. The Office of Statewide

Prosecution presented information to the Statewide Grand Jury. TheGrand Jury handed down a twelve-count indictment against WCC and

William Cooper (WCCs claims specialist). Eleven counts were for felony

grand theft, and one-count was for racketeering. Cooper entered a plea of

Guilty to Grand Theft and, in a simultaneous administrative agreement, he

agreed he would never prepare claims to be submitted to the Department

in the future. A criminal trial on the charges against WCC is pending.

Seminole Gulf Railway, LP.: This joint investigation by the OIG and the FDLE, disclosed that

on seven railroad signalization projects, Seminole Gulf Railway, L.P. officials submitted

certifications to the State asserting the company incurred expenses for project materials when, in

fact, no materials had been purchased. The Office of Statewide Prosecution filed criminal Felonycharges. The corporation and its president, Gordon Fay, entered into plea agreements with the

State. Seminole Gulf Railway, L.P. pled guilty to Grand Theft and agreed to repay the

Department $340,000 as well as the Departments investigative costs of over $46,000. The

company will serve a three-year probation during which time the terms of a special

administrative agreement will be in force to govern the companys working relationship with the

Department. Fay pled No Contest to Grand Theft charges.

HJ Trucking/Tarand Transport/Miller and Sons Trucking: This joint

investigation by the OIG, the FDLE, and the USDOT OIG disclosed that a

DBE trucker, the minority owner of HJ Trucking, prostituted his DBE

status and allowed non-DBE truckers to perform the work he was to

perform for agreed upon kickbacks. The case was briefed to the Office of

the United States Attorney, Middle District of Florida. The United States

Attorneys Office used a Federal Grand Jury to assist in the investigation.

This Grand Jury handed down a 34-count indictment charging conspiracy

to defraud the United States, conspiracy to commit money laundering,

using false documents, mail fraud and money laundering against HJ

Trucking and its owner, Miller and Sons Trucking and its owner, and

RepresentativeCase

Examples

ContractFraud


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20

Tarand Transport and its owners. Tarand Trucking and its owners were

convicted of 31 charged counts. HJ Truckings owner was convicted of 13

charged counts. Miller and Sons Trucking and its Vice-President pled

guilty to one count in a plea agreement reached before trial. Sentencing

for all those convicted is pending. This noteworthy investigationrepresents the first time an offense reported by a Department employee,

initially investigated by the OIG and then joined by state and federal law

enforcement officers, was indicted by a Federal Grand Jury and convicted

in federal court.

Bartow District Office: This investigation disclosed a District 1 building

maintenance crew supervisor, entrusted with valuable tools and

equipment, stole tools and converted them to his personal use. This

employee also gave Department equipment to his local church and used

his employees to complete woodworking projects for himself, his churchand for acquaintances. Over $8,000 in Department property was

recovered. This case was coordinated with the 10th Judicial Circuit State

Attorneys office. The Department employee was charged with theft,

made restitution, and was placed in a pretrial diversion program.

Department managers terminated the supervisors employment.

Pensacola Construction: This investigation disclosed four District 3 employees that comprised

a crew of construction inspectors, became involved in the extensive misuse of state time and

equipment for personal purposes. Examples included a supervisor using weeks of an employees

time (to include authorizing overtime payments) to change out an engine in his personal vehicle,

towing personal vehicles with Department vehicles, taking a girlfriend on a state trip in a statevehicle, and certifying inspections on construction projects that did not take place. Two

employees were terminated and two employees resigned in lieu of termination.

Pompano Maintenance: This investigation disclosed a District 4 centerline striping crew

supervisor destroyed State property valued at nearly $2,000 to create an enclosure for a non-

Department trailer he discovered abandoned at the side of the roadway. This supervisor misused

his cellular telephone, took a Department vehicle home without authorization and signed

inaccurate time sheets on his crewmembers. This case was coordinated with the Broward County

Sheriffs Office who arrested the employee. A criminal trial and Department disciplinary action

is pending against the employee.

West Palm Beach Maintenance: This investigation disclosed an engineer in a District 4

maintenance facility used Department time and his assigned Department computer to operate his

personal business. IT Audit Section participation in this investigation provided extensive

evidence of the unauthorized use of Department IT resources. The Department terminated the

engineers employment. This termination was appealed to the Public Employee Relations

Commission (PERC). The PERC hearing officer concurred with the termination.

EmployeeMisconduct


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The Florida Department of Transportation, Office of Inspector General,strives for continual improvement. In doing so, we have adopted sometechniques that could be considered best practices. These include:

The OIG participates in the Florida Inspectors General Network. This Web site was created toprovide a central location for information for the Inspector General (IG) community working inFlorida State Government Agencies/Departments. One component of this site is Audit BestPractices. This is a collection of audit tools and techniques used by internal auditors who workfor the State of Florida.

There are five Audit Best Practices categories: Audit Management, Project Planning,Fieldwork, Reporting and Follow-Up, and Other Activities. Nine DOT practices wereconsidered to be best practices.

External Audit representatives worked on a Quality Financial Management Improvement

Program Team to develop a Southeastern Overhead Guideline Book. State auditors as well as

public accountants utilize the book in the performance of consultant overhead audits. The bookis also used as a training tool for new audit personnel. Representatives are currently working on

a committee to develop a national audit guide, to be used by state auditors and public

accountants. It should be adopted in December 2001.

Several processes and practices in our Investigations unit have been recognized worthy of

emulation by other Inspector General functions in other agencies and by the Chief Inspector

Generals Office. Specific ones they have benchmarked include:

Interviews and Interrogation

Case Initiation

Investigative Reporting Case File Numbering System

During FY 2000-01, the OIG was involved in a number of other Department

and external agency activities. This section summarizes some of these

activities, including OIG coordination with other agencies, and a listing of

other agencies audits of Department activities during FY 2000-01.

The efforts included arranging for and monitoring Office of the Auditor General and OPPAGA

audits and reviews. The OIG was not operationally involved in these audits other than arranging

for and monitoring the audits and coordinating the Departments responses.

Strike Force Against Fraudulent Enterprises (SAFE) SAFE is a multi-agency projectdesigned to identify and address allegations of fraud in a coordinated manner, using the expertise

of law enforcement, regulatory agencies, and prosecutors as a team. The Inspector General and

the Director of Investigations actively participate in the SAFE initiative.

Get Lean Hotline The OIG handles complaints from the State Comptrollers Get LeanHotline. In most cases, these complaints are forwarded to the Investigations Section where they

Other OIGActivities

BestPractices


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22

become the foundation for inquiries that are referred to management or substantive cases

conducted by the Investigations Section staff.

Staff Development During FY 2000-01 OIG staff participated in a variety of professionaltraining including courses to meet the Government Auditing Standards (GAS) requirements.

GAS standards require each auditor to complete 80 hours of continuing education and

training that contributes to the auditors professional proficiency, every two years.

Office-wide training provided during the year included training in areas such as audit

risk assessment, technical report writing, and computer software skills.

The Strike Force Against Fraudulent Enterprises (SAFE), in conjunction with the

North Florida Chapter of the Association of Certified Fraud Examiners, hosted a two-

day CFE review course designed to prepare participants for the certification

examination. In support of the Inspector Generals priority on fraud deterrence and

detection, eight members of the staff completed the course and are pursuing their

certification.

The OIG will continue to provide staff the training needed to ensure high quality service.


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OFFICE OF INSPECTOR GENERALWORKPLAN FORFISCAL YEAR2001-2002

23

The purpose of the OIG Work Plan is to identify and select audit service topics and plan for

managing the Offices anticipated workload. A primary consideration in developing the WorkPlan is to provide the greatest possible benefit to the citizens of Florida and the Department from

our audit and investigative resources.

Specifically, this Work Plan details products to be delivered from two of the three functional

units within the OIG. The exception is the Investigations unit, whose work products and

workload are based primarily on allegations of wrongdoing received from Department staff,

contractor personnel, and citizens, as well as, requests by management.

The External Audit portion of the Work Plan is designed to ensure that costs charged to the

Department through contracts and agreements with outside entities are allowable and

appropriate. The Internal Audit portion of the Work Plan is designed to achieve balanced auditcoverage of the Department's financial, operational, and information systems operations.This Work Plan has many purposes and intended benefits. They include:

Assisting the Department in meeting its mission by planning our activities through a risk-

based process to provide the most effective coverage of the Departments programs,

processes, systems and contracts with outside entities;

Informing Department managers, outside agencies and entities of our mission, activities

and planned audit coverage; and

Familiarizing staff, both within the OIG and within the Department, with the functionsand services we provide.

Questions regarding the Work Plan may be directed to the applicable functional director

identified in the chart on page five of this report.

In addition to audits underway, the following External Audit projects have

been identified for inclusion in the FY 2001-02 OIG Work Plan:

Construction Contracting and Claims Audits: Claims audits arenormally performed on a request basis to determine whether financialelements of claims for additional project costs are justified based on

federal and state rules, regulations, and contract provisions.

Dispute Review Boards Audit: The Department and contractors use Dispute ReviewBoards (DRBs) to resolve claims and contractual disputes between the parties. The DRBs

consider both testimonial and documentary information provided by each party and recommend a

ExternalAudit

2001-2002 OIG

Work Plan


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24

settlement to resolve the dispute. The DRB member fees are shared by the Department and the

contractor. This audit would review the recommended settlements of the DRBs and the elements

that form the basis for the recommendations (legal, contractual, cost information, factual

circumstances). The objective of the audit would be to determine if recommendations made by

the DRBs are appropriately documented and supported and clearly define the basis upon which

the recommendation was made.

Review of Self Certifications: Under the recently revisedRule 14.75, FloridaAdministrative Code (FAC), consultants doing minor project level work will be required to

submit an informal, self-certified overhead report and statement describing their accounting

system using a Department prescribed format. These reviews will be performed on selected

consultant certifications to determine the adequacy and reliability of information submitted.

Accounting System Reviews: These reviews determine whether a consultants accountingsystem can accumulate and record costs in a job cost method that allows for accurate billings to

the Department.

Consultant Overhead Audit Reviews of CPA Work Papers: These reviews areperformed on selected independent CPA audits that establish consultant annual overhead rates

for indirect costs. Rule 14.75, FAC, requires that identified consultants submit an acceptable

overhead audit as part of the prequalification process to conduct business with the Department.

Consultant Final Audits: These audits determine whether costs billed to the Department arereasonable, in accordance with contract provisions, and in compliance with federal and state

procurement regulations. Consultant Final Audits are planned in the areas of Design,

Construction Engineering Inspection, Project Development and Environment, and Right-of-Way.

Consultant Preaward Reviews: These reviews are required by the Federal HighwayAdministration to determine if preaward consultant cost proposals appear reasonable and comply

with federal and state procurement rules and regulations.

Railroad Labor Additive Rates: These audits determine if the elements of rail companieslabor additive rates are reasonable and allowable. CSX is the major rail company audited.

Utility Company Overhead Rate Certifications: These are reviews of utility certificationsto the Department that certain unallowable overhead costs are not allocated directly or indirectly

to reimbursable Department utility relocation projects.

Process Reviews and Monitoring The External Audit Section will perform QualityAssurance Reviews on three areas during the year. These areas will be the District Rail Reviews,

Single Audit Monitoring Reviews, and Consultant Negotiation Process Reviews.

Assist Internal Audit on MIC Project Provide assistance to the Internal Audit Section onmonitoring the Miami Intermodal Center (MIC) project.


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Special Projects These requests cover many areas including providing assistance to theGovernors Chief Inspector General, Bid Proposal Reviews, Investigation assistance, and

Financial Reviews from various managers.

Single Audit Procedure: The External Audit Section will be in charge of revising the SingleAudit Procedure (Topic No. 450-021-001-c) for the Department. The purpose of this procedureis to detail the Departments responsibility to ensure compliance with Section 215.97 F. S., andthe U.S. Office of Management and Budget Circular No. A-133.


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The following table summarizes the External Audit Work Plan. This information is alsoreflected in the graph at Appendix A, Page 34.

Project TopicEst.

Hours

PlannedAudit

Reviews

Construction Services:

Claims Reviews 4000 15

Construction Project Audits 1200 5

Dispute Review Boards 800 1

Claims Education / Awareness Sessions 300 8

Consultant Contracting:

Final Audits 6400 40

Preaward Reviews 2880 90

Review of Self Certifications 400 10

CPA Work Paper Reviews 240 15

Accounting System Reviews 640 20

Consultant Negotiation Process Reviews 320 8

Public Transportation Office Reviews:

Railroad Labor Additive Rates 800 2

Single Audit Procedure Revision 400 1

Toll Facilities Trust Fund Review 200 1

Utility Company Overhead Certif ications 150 1

District Rail Reviews 300 1

Process Reviews and Monitoring:

Professional Service Task Force Assistance 600 2

CITS Phase III Assistance 400 1

Determining Cost For Geotech Services 300 1

Assist Internal Audit on MIC Project 1600 2

Single Audit Monitoring Reviews 500 10

Special Projects:

Job Costs Database Development 600 1

Single Audit Automation 600 1

FDOT Cost Allocation Plan Audit 200 1

FDOT Aerial Photo Lab Rate 100 1

Gainesville Test Lab Rate 100 1

Audit Assistance (including Investigations, EOG andFHWA Assistance)

1170 10

Total 25,200 249


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27

In addition to audits underway, the following Internal Audit

projects have been identified for inclusion in the FY 2001-

02 OIG Work Plan:Construction Training and Qualification Program Audit: The Department outsourced the

Construction Training and Qualification programs to the University of Florida. This program

was to be run as a self-sufficient program. The objectives of this assignment will be to

determine if the programs fees are reasonable and cover its costs.

Federal-Aid Current Bill System: The Departments federal-aid billings are processed through

the Financial Management System. This assignment will be an application control and financial

audit of the FM system. Objectives to include assuring adequate controls and oversight are in

place to prevent ineligible costs from being claimed on the Federal-aid current bill, and that

reimbursement requests are adequately supported.

State Materials Office: Local Area Network audit to include data center risk assessment,

licensing, server implementation, security, backup, recovery plan, and LAN administration.

Hazardous Materials: Performance and compliance audit to determine the adequacy and

effectiveness of the Departments processes to handle hazardous materials.

Norton Antivirus Follow-up Audit: The use of antivirus software is one of the Departments

fundamental protections of the information technology infrastructure. The objective of this audit

will be to determine if the configurations implemented as a result of the prior audit are currently

providing optimal protection.

Standard Operating System Audit: The standard operating system (SOS) defines how the

Department is managed through policies, procedures and directives. The objective will be to

assure at a high-level that all major department programs and office have adequate policies and

procedures incorporated into the SOS.

Recovery of Unclaimed Funds: Two outside companies claim to have identified unclaimed

funds from eminent domain lawsuits belonging to the Department in court accounts. This

financial related audit will attempt to identify those funds and include an evaluation of controls

over deposits into court registries.

Miami Intermodal Center (MIC): This proactive audit will monitor the progress of the MiamiIntermodal Center Project and develop specific audits and reviews to evaluate various aspects of

the project.

Computer Forensics Services: The computer forensics services are

primarily performed at the request of management. Recent

implementations of the Departments infrastructure have allowed the use

of audit hooks to identify areas of misuse and abuse.

InternalAudit

AssuranceServices

Assignments

ComputerForensicServices

Assignments


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Client/Server System Development: Assist the Office of Information

Systems in the development or adaptation of client/server standards.

Consultant Invoice Transmittal System Phase III is a candidate for this

audit due to the use of COOL: Gen development tool.

Governmental Accounting Standards Board (GASB-34): The purpose of GASB-34 is to

provide better financial reports giving an overall financial health of the agency. Our initial

review focused on methodology and assumptions used to compute figures needed for the

accounting change. This project will focus on the processes used to collect data to include data

definitions and data integrity.

Outside Sales Review: The objective of this review will be to evaluate the methodology used

by Survey and Mapping in determining costs of outside sales.

Purchasing Card Statistical Sampling Plan: Assist the Office of Comptroller in development

of a statistical sampling plan to sample and pre-audit Purchasing card for travel transactions.

Service Level Agreements with State Technology Office: The objective of this assignment

will be to evaluate the accuracy of the baseline level of current service. Monitor deliverance of

service level objectives to see if they comply with the agreement. This may involve developing

service level metrics.

Warehouse Closing Implementation: The Department is closing the Central Warehouse.

Management has asked our assistance in monitoring inventory and other procedures involved in

closing the warehouse.

Web System Development: The objective of this assignment will be to assist the OIS in the

development or adaptation of standards for Web applications. The replacement for RCI is the

most likely candidate for this audit because it: 1) Is a core production system, 2) Will provide

data to multiple systems, and 3) Will have a Web browser interface.

Annual Performance Measure Assessment: In accordance with Section

20.055(2)(b), F.S., the Office of Inspector General will assess the

reliability and validity of information for the 46 proposed measures for

Fiscal Year 2002-2003.

Time and Cost Overruns: The traditional performance measure assessment work is at a highlevel. This work will focus on the detailed processes used to collect data for performance

measures and will include process flow mapping, data definitions, and data integrity. It will

evaluate whether everyone uses the appropriate data in performing analyses of time and cost

overruns. Time and cost overruns ties directly to the Departments Strategic Objective 2.1

Improve Project Delivery Performance. This work will help us determine any areas that need

expanded tests of internal controls and data.

Consulting

Services

Assi nments

PerformanceMeasure

AssessmentAssignments


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29

Periodic Procedure Reviews: Procedure Review is an accountability

activity to help ensure integrity, accountability, and process improvement

are addressed in Department programs. The OIG participates in

Preliminary, Executive, Task Team and Periodic reviews of the

Departments SOS. The focus of this years procedure reviews will be anin-depth analysis of procedures, which tie to the Departments

performance measures.

Risk Assessments: Risk Assessment is a systematic process for assessing

and integrating professional judgments about probable adverse conditions

and/or events. The risk assessment process provides a means of organizing

and integrating professional judgments for development of work

schedules. The result can be used to schedule limited audit resources and

provided to management as a service to allow them to place resources in

areas of highest risk.

Grant Programs: Proper management of grants is a perennial high-risk area for state agencies.

The focus of this assignment will be to update the Departments universe of grants and perform a

risk assessment on the various grant programs.

Remote Access Risk Assessment: The focus of this assignment will be to determine the

universe of the methods and number of remote accesses into the Departments information

technology infrastructure. The method with the highest risk factors will become the topic of a

separate audit.

ProcedureReviews

RiskAssessment

ServicesAssignments


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The following table summarizes the Internal Audit Section Work Plan. This information is also

reflected in the graph at Appendix B Page 35.Carry Forward Project Topics by Core Service Category

EstimatedHours

MajorArea

Assurance ServicesCADD PC Replacement 60 10H

Access Authorization 50 10B

COBIT 50 10A

E-Commerce 800 10E

Internet Phone Charges 50 10E

Computer Aid, Inc. 250 7N

GCIE Purchase Card 900 7N

Miami Internodal Center (MIC) - CommuniKatz, Inc. 300 1B

Computer Forensics Services

ITR Reviews 400 10J

Consulting Services

GASB-34 300 9F

Special Projects

Laboratory Information Management System Complaint 300 7B

TOTAL CARRY FORWARD HOURS 3,460

New Project Topics by Core Service CategoryEstimated

HoursMajorArea

Assurance Services

Construction Training and Qualifications Program 800 4E

Recovery of Unclaimed Funds 300 3H

T21 Funds 500 9D

Employee Benefit Fund 200 9F

GCIE - Interagency Audit 480

Gainesville Materials Lab Data Center 400 10E

Norton Antivirus Follow-up 300 10B


Standard Operating System 200 7O

Hazardous Materials 500 8D


Computer Forensics Services

ITR Reviews 1,800 10J

Consulting Services

GASB-34 750 9FLease vs. Purchase of Vehicle Fleet 300 7J

Outside Sales Review 200 9G

P-Card Statistical Sampling Plan 80 9D

Warehouse Closing Implementation 300 7H

Client/Server System Development 400 10G

Security Awareness Presentations 200 10B

Service Level Agreements with STO 200 10A

Web System Development 400 10G

Miami Intermodal Center (MIC) 900 1B


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Performance Measures Assessment Services

Reliability and Validity Review 1,000 7D

Construction Time and Cost Overruns 800 7D

Procedure Review Services

Policy and Procedure Reviews 1,000 7ORisk Assessment Services

Grant & Joint Participation Agreement Programs 756 9D

Remote Access Risk Assessment 478 10B

Special Projects

Reserved for Management Requests 2,936

Total Hours for New Projects 17,140

Total Carry Forward Hours 3,460

Total Available Hours 20,600


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This page isintentionally blank.


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APPENDICES

A. External Audit FY 2001-2002 Work Plan ...................................................... 34

B. Internal Audit FY 2001-2002 Work Plan ....................................................... 35

C. Internal Audit FY 2002-2003/2003-2004 Work Plan ..................................... 38

D. Risk Factors ..................................................................................................... 39

E. Distribution List .............................................................................................. 40

F. Work Plan Committee .................................................................................... 41

G. How to Contact the OIG ................................................................................. 42

H. Significant Reports Issued During FY 1999-2000 .......................................... 43


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APPENDIX A

External Audit FY 2001-2002 Work Plan

Construction

Services

25%

Consulting

Contracting

44%

Special

Projects

11%

Process

Reviews and

Monitoring

13%

Public

Transportation

Office Reviews

7%


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35

APPENDIX B

Internal Audit FY 2001-2002 Work Plan

By Service Category

Special Projects

16% Assurance

Services

33%

Computer

Forensic

Services

11%Consulting

Services

20%

Performance

Measures

Assessment

Services

9%

Procedure

Review Services

5%

Risk

Assessment

Services

6%


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APPENDIX B (continued)

IT Audit FY 2001-2002 Work PlanBy Program Area

Software

Applications

Development

12%

Other

8%

Procedure

Management

1%

Special Projects10%

Telecommunications

/ Networking

18%

Security

15%Computer Forensics

32%

IT Planning

4%


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37

APPENDIX B (continued)

Performance Audit 2001-2002 Work PlanBy Program Area

Quality

Management

Efforts

27%

Contracting

4%

Multi-Modal

Planning

17%

Other

7%

Purchasing

17%

Procedures

Management

10%

Industrial Safety

7%

Special Projects

11%

Financial Services Audit 2001-2002 Work Plan

By Program Area

Hazardous Material

Management

4%

Materials &

Research

12%

Warehouse

Operations

4%

Mobile Equipment

4%

ProcedureManagement

6%

Disbursement

Management

19%

Financial Reporting

18%

Cost Accounting

3%

Other

7%

Special Projects

23%


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APPENDIX C

Internal AuditFY 2002-2003/2003-2004 Work Plan

Project TopicMajor

Area

New Projects Fiscal Year 2002-2003

State Technology Office Service Level Agreements 10A

Virtual Private Network 10A

One Florida 8C

SunPass 9E

New Projects Fiscal Year 2003-2004

Intelligent Transportation Systems 10A

Date Repository 10G

Bridge Management System (post implementation) 10G

Business Damages/ROW Acquisition 3C

Local Agency Program 9C

MCCO Terminal Audits 5D


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APPENDIX D

Risk Factors

Management/Outside Interest

Department management

Transportation Commission

Upcoming legislation

Required by law to be audited by outside entitiessuch as State Auditor General's Office (OAG)Concern of Governor's Office, State Comptroller's Office, etc.

Metropolitan Planning Organizations (MPO), Cities/CountiesVendors

Prior Coverage

Coverage of External Auditors (OAG, Federal, etc.)

Previous Audit(s): Topics, Results, Dates

Quality Improvement/Assurance/Task Team Efforts

Timing

Do we have a target of opportunity? Is it a hot topic?

Perishability of issue

VulnerabilityFraud, waste, abuse (potential, prior instances)

Inherent risk

Legal liability


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APPENDIX E

Distribution ListTom Barry, Secretary

Ken Morefield, Assistant Secretary for Transportation Policy

Cris Speer, Assistant Secretary for Finance and Administration

David Brown, Chairman, Florida Transportation Commission,

Attention: Bill Ham

William Monroe, Auditor General, Office of the Auditor General,

Attention: L. R. Weathermon

David Twiddy, Secretary, District 1

Aage Schroder, Secretary, District 2

Edward Prescott, Secretary, District 3

Rick Chesser, Secretary, District 4Michael Snyder, Secretary, District 5

Jose Abreu, Secretary, District 6

Ken Hartmann, Secretary, District 7

Jim Ely, Secretary, Turnpike District

Pamela Leslie, General Counsel

Freddie Simmons, State Highway Engineer

Ysela Llort, State Transportation Planner

Marion Hart, Jr., State Public Transportation Administrator

Dick Kane, Public Information Administrator

Robin Naitove, Comptroller

Nelson Hill, STO Chief Operating Officer

Vicki Bradford, Acting Chief, Information Officer

Deborah Stemle, Director of Toll Operations

Annette Dann, Director of Management and Budget

Ruth Dillard, Director of Office of Administration

Sarah Porter, Legislative Programs Administrator

Bill Kynoch, Budget Officer

Marcia Cooke, Governor's Chief Inspector General, Attention: James Thomas

Chairman, Senate Transportation Committee, Attention: Reynold Meyer

Chairman, House Committee on Transportation, Attention: Phillip Miller

Chairman, Senate Budget Committee, Attention: Tom Barrett

Chairman, House Transportation and Economic Development, Appropriations

Committee, Attention: Eliza HawkinsChairman, Joint Legislative Auditing Committee, Attention: Terry Shoffstall

John Turcotte, Director, Office of Program Policy Analysis and Government

Accountability

James E. St. John, Division Administrator, FHWA


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APPENDIX F

Work Plan Committee

Committee Members:

Cecil Bragg

Joe Peet

Lisa Evans

Robert Clift

Marlys Eichhoefer

Nancy Moon


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APPENDIX G

How to Contact the OIG

Mail:Florida Department of TransportationOffice of Inspector General605 Suwannee Street, MS-44Tallahassee, Florida 32399-0450

Internet E-mail:

[email protected]

Web Sites:

External to DOT:

http://www.dot.state.fl.us/inspectorgeneral/

Internal DOT INFONET:

http://infonet.dot.state.fl.us/inspectorgeneral/

Fraud Hotline:

1-800-255-8099 (within Florida)

Telephone:

(850) 410-5800SUNCOM 210-5800

Fax:

(850) 488-4417

SUNCOM 278-4417


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APPENDIX

Significant ReportsIssued In FY 2000-2001

Report No. Project Topic TypeDate

Issued

04B-0001-00 Alternative Contractin Methods Audit 09/29/00

O4F-0004-00 Su lemental A reement Process

10A-0002a-00 Risk of Outsourcin Information Technolo Memo 09/14/00

10B-0006-00 Norton AntiVirus Com liance Audit 07/28/00

10B-1004-00 Business Im act Anal sis Surve Memo 03/07/01

10D-0002-00 Pro ram Chan e Mana ement Audit 12/18/00

10E-0001-00 Local Area Network Backu Audit 10/19/00

140-1025-00 FDOT Indirect Cost Allocation Rates FY 01-02 Audit 07/03/01

140-1027-00 Gainesville Test Lab Rates FY 01-02 Audit 06/25/01

140-1029-00Acquisition and Use of Information Technology

Consultants Audit 08/31/00

140-1030-00 Aerial Photo Rates FY 01-02 Audit 08/08/01

300-1001-00 Florida East Coast Rate Audit 05/11/01

Annual Report and Work Plan 2001

Documents

Transcript of Annual Report and Work Plan 2001