Audit Policies and

Practices Committee
 Identify
and compile internal and
external metrics and performance
measures used in the Federal audit
community for evaluating audit quality
and timeliness.

 Compile factors and best practices used

in annual audit planning.

2
 Collaboratively developed survey questions on
• Internal Reporting – 6 questions
• External Reporting – 2 questions
• Annual Planning – 10 questions

 Solicited input from FAEC community in May 2013

 Received responses from 34 Audit organizations.

3
 Answers objectives
 Provides timely findings and actionable
recommendations
 Addresses critical and high-risk areas
 Adheres to quality assurance guidance (e.g.,
Yellow Book, internal and peer reviews)
 Involves client satisfaction surveys to obtain
feedback.

4
35
30
25
20
15
10 NA
5 NO
0 YES

• 8 metrics and performance measures surveyed

• Considerable feedback provided
5
 YES NO NA
Measure 30 3 0
Adopted

Performance Metrics Percentage

Draft reports issued within 60%
300 elapsed days
Reduction in average 3%
elapsed days to deliver
final reports compared to
prior year
Projects completed within 80%
one year

• Tracked and monitored

• Included in employee performance standards.
6
 YES NO NA

Measure 24 8 1
Adopted

• Internal guide to evaluate audits in process

• Performance metric and tracking of

 Timeliness of specific phases
 Staff workdays
 Direct time charges
 Return on investment

7
 YES NO NA
Measure 30 4 0
Adopted

• Agency strategic goals/priorities

• GAO high-risk areas

• IG management challenges

• Enterprise-level risk assessment

• Input from senior organizational leaders

• Annual risk-based program assessments

• Percentage of planned performance audits address high risk areas

8
 Yes No NA
Measure 27 6 1
Adopted

• Establish metrics to ensure audits meet statutory

mandated deadlines

• Establish individual performance standards

9
 YES NO NA
Measure 29 3 2
Adopted –
Reductions,
Recoveries,
Reallocations
• Tracks monetary benefits with specific goals
 Report at least $30M in potential monetary benefits each fiscal year
 Meet a return on investment goal of at least $10: $1, $8: $1
 Ensure 10% of published reports identify potential monetary benefits
 Ensure 60% of performance audits include recommendations leading to demonstrable
cost savings and/or funds put to better use

• Monitors benefits via management information system

• Performance metric based on the dollar savings identified during the year.

• Reviews actual realized benefits during follow-up engagements

• Reports financial benefits only as a workload measure; no goal

10
 YES NO NA
Measure 27 6 1
Adopted –
Improved
Processes,
Procedures, or
Controls

• Monitors recommendation implementation and follows up when implementation has not

occurred by target date of completion

• Discusses audit work in context of organization’s qualitative goals

• Includes corporate goals such as:

 70% of past recommendations implemented within two years of the fiscal year in which
the report was issued

 60% of performance audits should include recommendations leading to demonstrable

cost savings, program efficiencies, and/or funds put to better use

11
 YES NO NA
Measure Adopted – 22 11 1
Report Issued
Within a Specified
Number of Days

• Information obtained before the report is issued

• Information tracked via internal management system.

• All open audit recommendations are discussed monthly with audit resolution officials

• Metrics established for receipt of comments and actions taken

 Request comments and recommendation responses within 30 days of the draft report issuance.
 Achieve a 5-year average implementation rate of 85% for accepted recommendations.
 Obtain final management decisions and/or target implementation dates within 90 days of report
issuance.
 Write recommendations so organization can complete them within 6-9 months.
 Receive action plans within 60 day of final report issuance.

• Report twice a year on all unimplemented recommendations past 6 months of original target date to
agency senior leadership.
12
 YES NO NA
Measure 32 2 0
Adopted

 Weekly exception report for projects that have not met milestones
 Communicate status of high impact audits during monthly senior management meeting
 Establishes an estimated amount of audits to complete in the fiscal year
 Incorporates an organization milestone goal for deliverables

• Deliver 60% of audits with draft reports within 300 elapsed days
• Issue reports within 270 days of audit start
• Complete 80% of projects with a year.
• Finalize 90% of assignments within 30 days of established final report milestones
• Finish audits within one year from entrance conference
• Conclude audits based on audit scope: Standard audit is 11 months from entrance
conference to final report; limited scope is 2.5 to 10 months from entrance to final
report

13
 YES NO NA
Measure 21 13 0
Adopted

 Tryto do a balanced approach for

financial, process efficiency, and program
impact, but no formal scorecard

14
 YES NO NA

Measure Adopted 33 1 0

 Total cycle time

• From initiation to report issuance -- 8 months for non complex audits to 13 months for complex audits.
• Total elapsed days for each project
• Contract/Grant audits:5 days on-site & 5 days for survey and report completion.

 Recommendations concurred with by Agency

• 80% are accepted

 Percent of open Recommendations implemented

• 95% of past recommendations are implemented.

 Number of Audit reports produced; percentage of reports containing one or

more recommendations
 Financial Benefits & Non financial benefits
• Return on Investment
• Percentage of audit completed with established timeframes (90%, 75%)
• Complete 90% of audits within 15% of established budget and within 30 days of report milestones;
• 75% of audits address high risk activities

15
 YES NO NA
Measure 32 2 0
Adopted

 No Furloughs this Fiscal year

 Money is available for travel and training at a reduced rate.

 Work plan focused on audits requiring less travel; on track

to meet CPE requirements.

 Additional funding from ARRA and Hurricane Sandy relief.

16
Measure Adopted YES NO NA
Staff Professionalism 26 3 3
– staff training
Value of Service 26 4 2
Provided
– stakeholder
survey/feedback;
dollar value of
recommendations;
briefing with Agency
leadership;
briefing with
Congressional staff
Other 13 7 3
– acceptance of
recommendations

17
Measure Adopted YES NO NA
Measures 31 3 0
Contained in Semi-
Annual Report
Additional 23 6 2
Measures
- timeliness;
number of reports
issued;
percentage of
recommendations
with management
decision/final action;
percentage of audits
with high
risk/management
challenges

18
 Report Issuance 24

 Amounts Agreed to 13

 Amounts Agency Agreed to Collect 1

9 report at issuance and agreed to

19
Measures Adopted YES NO NA

Linked to OIG 32 1 1
strategic goals
Linked through 18 15 1
cascading
objectives/strategies

• One associated this with assessing the risk

environment to develop risk categories

20
 YES NO NA
Measure Adopted 20 13 1
– linked though
other metrics

• Number of intended reviews

• Timeliness
• Ratio of requested to internally-generated audits
• Coverage of Agency priorities/mission
• Coverage of Management Challenges
• Coverage of GAO High Risk Areas
• Amount of Direct Staff time applied to critical and
high impact projects
• Number of reports issued aligned by Management
Challenges
21
Measures Adopted YES NO NA
OIG goals linked to 27 4 2
Department
Linked to Agency 30 2 2
management
challenges
Department 27 6 0
provides feedback
on plan
- input, not approval

22
 Other Factors Considered
• Congressional or Agency leadership requests,
• New programs,
• Audit history and risk with existing programs
• Follow up on prior recommendations
• Stakeholder input
• Risk Assessment
• Resource Availability
• Balance of coverage across Agency programs
• Timing to ensure most value to client

23
 Other Factors (cont.)
• Hotline complaints
• Large grant recipients/dollar programs
• OMB A-123 and FMFIA assessments
• Government-wide initiatives
• Statutory requirements
• Media interests/emphasis
• Special funding allocations (e.g., Recovery Act,
Disaster Oversight, etc.)
• Investigative referrals
• Impact on the delivery of services and benefits to
recipients
• Public interest

24
 Priority 1 2 3 4

Legislation, Executive Order, OMB

30 2 1 0
Circular (i.e., mandatory work)?

Specific requests from

5 18 8 3
Department/Agency Leadership?

Congressional appropriators or
16 16 1 1
overseers?
Self-initiated work?
6 15 8 5

25
 Ad Hoc (as needed) 22

 Scheduled update 6

 Not Typically Modified 6

26
 John Needham, SBA
 Stephen Dingbaum, NRC
 Terri Alvarado, Army Audit
 Ann Eilers, Commerce
 Jane Mintz, Commerce
 Julie Marlowe, SEC
 Gil Harden, USDA

27
 Questions

 Thanks for providing information

28