HB 1033

1
A bill to be entitled
2An act relating to agency inspectors general; amending s.
320.055, F.S.; providing definitions; requiring agency
4inspectors general to adopt certain principles and
5standards; requiring agencies under the Governor to notify
6the Chief Inspector General of inspector general
7appointments and terminations; prohibiting agency staff
8from preventing or prohibiting the inspector general or
9director of auditing from initiating, carrying out, or
10completing any audit or investigation; requiring audits to
11be conducted in accordance with the current International
12Standards for the Professional Practice of Internal
13Auditing; requiring the Chief Inspector General to adopt
14certain policies and procedures; providing an effective
15date.
16
17Be It Enacted by the Legislature of the State of Florida:
18
19     Section 1.  Section 20.055, Florida Statutes, is amended to
20read:
21     20.055  Agency inspectors general.--
22     (1)  For the purposes of this section:
23     (a)  "State agency" means each department created pursuant
24to this chapter, and also includes the Executive Office of the
25Governor, the Department of Military Affairs, the Fish and
26Wildlife Conservation Commission, the Office of Insurance
27Regulation of the Financial Services Commission, the Office of
28Financial Regulation of the Financial Services Commission, the
29Public Service Commission, and the state courts system.
30     (b)  "Agency head" means the Governor, a Cabinet officer, a
31secretary as defined in s. 20.03(5), or an executive director as
32defined in s. 20.03(6). It also includes the chair of the Public
33Service Commission, the Director of the Office of Insurance
34Regulation of the Financial Services Commission, the Director of
35the Office of Financial Regulation of the Financial Services
36Commission, and the Chief Justice of the State Supreme Court.
37     (c)  "Entities contracting with the state" means
38organizations or businesses having a legal existence, such as
39corporations or partnerships, as opposed to natural persons,
40that have entered into a relationship with a state agency as
41defined in paragraph (a) to provide for consideration certain
42goods or services to the state agency or on behalf of the state
43agency. The relationship may be evidenced by payment by warrant
44or purchasing card, contract, purchase order, provider
45agreement, or other such mutually agreed upon relationship.
46     (d)  "Individuals substantially affected" means natural
47persons who have established a real and sufficiently immediate
48injury in fact due to the findings, conclusions, or
49recommendations of a final report of a state agency inspector
50general and who do not have or are not currently afforded an
51existing right to an independent review process. Employees of
52the state, including career service, probationary, other
53personal service, Selected Exempt Service, and Senior Management
54Service employees, are not covered by this definition.
55     (e)  "Additional material relevant" means evidence
56submitted to the state agency inspector general prior to release
57of the final report that likely would have affected the
58investigative findings. Such evidence is not merely cumulative
59of evidence considered by the state agency inspector general
60and, to be relevant, must tend to prove or disprove the matters
61at issue in the investigation. Newly discovered evidence may be
62considered if it was discovered subsequent to the agency
63inspector general's final report and the agency inspector
64general has affirmatively refused to reopen the investigation
65despite such evidence. Such evidence shall not have been
66withheld from the state agency inspector general during the
67original investigation.
68     (f)  "Original investigation" means an official
69investigative review by a state agency inspector general of
70information relative to suspected violations of any law, rule,
71or agency policy resulting in written findings.
72     (2)  The Office of Inspector General is hereby established
73in each state agency to provide a central point for coordination
74of and responsibility for activities that promote
75accountability, integrity, and efficiency in government. It
76shall be the duty and responsibility of each inspector general,
77with respect to the state agency in which the office is
78established, to:
79     (a)  Advise in the development of performance measures,
80standards, and procedures for the evaluation of state agency
81programs.
82     (b)  Assess the reliability and validity of the information
83provided by the state agency on performance measures and
84standards, and make recommendations for improvement, if
85necessary, prior to submission of those measures and standards
86to the Executive Office of the Governor pursuant to s.
87216.0166(1).
88     (c)  Review the actions taken by the state agency to
89improve program performance and meet program standards and make
90recommendations for improvement, if necessary.
91     (d)  Provide direction for, supervise, and coordinate
92audits, investigations, and management reviews relating to the
93programs and operations of the state agency, except that when
94the inspector general does not possess the qualifications
95specified in subsection (4), the director of auditing shall
96conduct such audits.
97     (e)  Conduct, supervise, or coordinate other activities
98carried out or financed by that state agency for the purpose of
99promoting economy and efficiency in the administration of, or
100preventing and detecting fraud and abuse in, its programs and
101operations.
102     (f)  Keep such agency head informed concerning fraud,
103abuses, and deficiencies relating to programs and operations
104administered or financed by the state agency, recommend
105corrective action concerning fraud, abuses, and deficiencies,
106and report on the progress made in implementing corrective
107action.
108     (g)  Ensure effective coordination and cooperation between
109the Auditor General, federal auditors, and other governmental
110bodies with a view toward avoiding duplication.
111     (h)  Review, as appropriate, rules relating to the programs
112and operations of such state agency and make recommendations
113concerning their impact.
114     (i)  Ensure that an appropriate balance is maintained
115between audit, investigative, and other accountability
116activities.
117     (j)  Adopt the current Association of Inspectors General
118Principles and Standards for Offices of Inspector General for
119meeting the duties and responsibilities pursuant to this
120section.
121     (3)(a)  The inspector general shall be appointed by the
122agency head. For agencies under the direction of the Governor,
123the appointment shall be made after notifying the Governor and
124the Chief Inspector General in writing, at least 7 days prior to
125an offer of employment, of the agency head's intention to hire
126the inspector general.
127     (b)  Each inspector general shall report to and be under
128the general supervision of the agency head and shall not be
129subject to supervision by any other employee of the state
130agency. The inspector general shall be appointed without regard
131to political affiliation.
132     (c)  An inspector general may be removed from office by the
133agency head. For agencies under the direction of the Governor,
134the agency head shall notify the Governor and the Chief
135Inspector General, in writing, of the intention to terminate the
136inspector general at least 7 days prior to the removal. For
137state agencies under the direction of the Governor and Cabinet,
138the agency head shall notify the Governor and Cabinet in writing
139of the intention to terminate the inspector general at least 7
140days prior to the removal.
141     (d)  The agency head or agency staff shall not prevent or
142prohibit the inspector general or director of auditing from
143initiating, carrying out, or completing any audit or
144investigation.
145     (4)  To ensure that state agency audits are performed in
146accordance with applicable auditing standards, the inspector
147general or the director of auditing within the inspector
148general's office shall possess the following qualifications:
149     (a)  A bachelor's degree from an accredited college or
150university with a major in accounting, or with a major in
151business which includes five courses in accounting, and 5 years
152of experience as an internal auditor or independent postauditor,
153electronic data processing auditor, accountant, or any
154combination thereof. The experience shall at a minimum consist
155of audits of units of government or private business
156enterprises, operating for profit or not for profit; or
157     (b)  A master's degree in accounting, business
158administration, or public administration from an accredited
159college or university and 4 years of experience as required in
160paragraph (a); or
161     (c)  A certified public accountant license issued pursuant
162to chapter 473 or a certified internal audit certificate issued
163by the Institute of Internal Auditors or earned by examination,
164and 4 years of experience as required in paragraph (a).
165     (5)  In carrying out the auditing duties and
166responsibilities of this act, each inspector general shall
167review and evaluate internal controls necessary to ensure the
168fiscal accountability of the state agency. The inspector general
169shall conduct financial, compliance, electronic data processing,
170and performance audits of the agency and prepare audit reports
171of his or her findings. The scope and assignment of the audits
172shall be determined by the inspector general; however, the
173agency head may at any time direct the inspector general to
174perform an audit of a special program, function, or
175organizational unit. The performance of the audit shall be under
176the direction of the inspector general, except that if the
177inspector general does not possess the qualifications specified
178in subsection (4), the director of auditing shall perform the
179functions listed in this subsection.
180     (a)  Such audits shall be conducted in accordance with the
181current International Standards for the Professional Practice of
182Internal Auditing as and subsequent Internal Auditing Standards
183or Statements on Internal Auditing Standards published by the
184Institute of Internal Auditors, Inc., or, where appropriate, in
185accordance with generally accepted governmental auditing
186standards. All audit reports issued by internal audit staff
187shall include a statement that the audit was conducted pursuant
188to the appropriate standards.
189     (b)  Audit workpapers and reports shall be public records
190to the extent that they do not include information which has
191been made confidential and exempt from the provisions of s.
192119.07(1) pursuant to law. However, when the inspector general
193or a member of the staff receives from an individual a complaint
194or information that falls within the definition provided in s.
195112.3187(5), the name or identity of the individual shall not be
196disclosed to anyone else without the written consent of the
197individual, unless the inspector general determines that such
198disclosure is unavoidable during the course of the audit or
199investigation.
200     (c)  The inspector general and the staff shall have access
201to any records, data, and other information of the state agency
202he or she deems necessary to carry out his or her duties. The
203inspector general is also authorized to request such information
204or assistance as may be necessary from the state agency or from
205any federal, state, or local government entity.
206     (d)  At the conclusion of each audit, the inspector general
207shall submit preliminary findings and recommendations to the
208person responsible for supervision of the program function or
209operational unit who shall respond to any adverse findings
210within 20 working days after receipt of the tentative findings.
211Such response and the inspector general's rebuttal to the
212response shall be included in the final audit report.
213     (e)  The inspector general shall submit the final report to
214the agency head and to the Auditor General.
215     (f)  The Auditor General, in connection with the
216independent postaudit of the same agency pursuant to s. 11.45,
217shall give appropriate consideration to internal audit reports
218and the resolution of findings therein. The Legislative Auditing
219Committee may inquire into the reasons or justifications for
220failure of the agency head to correct the deficiencies reported
221in internal audits that are also reported by the Auditor General
222and shall take appropriate action.
223     (g)  The inspector general shall monitor the implementation
224of the state agency's response to any report on the state agency
225issued by the Auditor General or by the Office of Program Policy
226Analysis and Government Accountability. No later than 6 months
227after the Auditor General or the Office of Program Policy
228Analysis and Government Accountability publishes a report on the
229state agency, the inspector general shall provide a written
230response to the agency head on the status of corrective actions
231taken. The Inspector General shall file a copy of such response
232with the Legislative Auditing Committee.
233     (h)  The inspector general shall develop long-term and
234annual audit plans based on the findings of periodic risk
235assessments. The plan, where appropriate, should include
236postaudit samplings of payments and accounts. The plan shall
237show the individual audits to be conducted during each year and
238related resources to be devoted to the respective audits. The
239Chief Financial Officer, to assist in fulfilling the
240responsibilities for examining, auditing, and settling accounts,
241claims, and demands pursuant to s. 17.03(1), and examining,
242auditing, adjusting, and settling accounts pursuant to s. 17.04,
243may utilize audits performed by the inspectors general and
244internal auditors. For state agencies under the Governor, the
245audit plans shall be submitted to the Governor's Chief Inspector
246General. The plan shall be submitted to the agency head for
247approval. A copy of the approved plan shall be submitted to the
248Auditor General.
249     (6)  In carrying out the investigative duties and
250responsibilities specified in this section, each inspector
251general shall initiate, conduct, supervise, and coordinate
252investigations designed to detect, deter, prevent, and eradicate
253fraud, waste, mismanagement, misconduct, and other abuses in
254state government. For these purposes, each inspector general
255state agency shall:
256     (a)  Receive complaints and coordinate all activities of
257the agency as required by the Whistle-blower's Act pursuant to
258ss. 112.3187-112.31895.
259     (b)  Receive and consider the complaints which do not meet
260the criteria for an investigation under the Whistle-blower's Act
261and conduct, supervise, or coordinate such inquiries,
262investigations, or reviews as the inspector general deems
263appropriate.
264     (c)  Report expeditiously to the Department of Law
265Enforcement or other law enforcement agencies, as appropriate,
266whenever the inspector general has reasonable grounds to believe
267there has been a violation of criminal law.
268     (d)  Conduct investigations and other inquiries free of
269actual or perceived impairment to the independence of the
270inspector general or the inspector general's office. This shall
271include freedom from any interference with investigations and
272timely access to records and other sources of information.
273     (e)  Submit in a timely fashion final reports on
274investigations conducted by the inspector general to the agency
275head, except for whistle-blower's investigations, which shall be
276conducted and reported pursuant to s. 112.3189.
277     (7)  Each inspector general shall, not later than September
27830 of each year, prepare an annual report summarizing the
279activities of the office during the immediately preceding state
280fiscal year. The final report shall be furnished to the agency
281head. Such report shall include, but need not be limited to:
282     (a)  A description of activities relating to the
283development, assessment, and validation of performance measures.
284     (b)  A description of significant abuses and deficiencies
285relating to the administration of programs and operations of the
286agency disclosed by investigations, audits, reviews, or other
287activities during the reporting period.
288     (c)  A description of the recommendations for corrective
289action made by the inspector general during the reporting period
290with respect to significant problems, abuses, or deficiencies
291identified.
292     (d)  The identification of each significant recommendation
293described in previous annual reports on which corrective action
294has not been completed.
295     (e)  A summary of each audit and investigation completed
296during the reporting period.
297     (8)  The Chief Inspector General in the Executive Office of
298the Governor, as defined in s. 14.32, shall:
299     (a)  Adopt policies and procedures to specify the
300conditions and procedures for reviewing an agency inspector
301general final investigative report. The policies and procedures
302must include provisions related to:
303     1.  Offering entities contracting with state agencies and
304individuals substantially affected by the findings, conclusions,
305and recommendations a meaningful opportunity to challenge in
306writing the findings, conclusions, and recommendations contained
307in an agency inspector general's final investigative report or
308to seek review by the Chief Inspector General under the process
309described in this subsection.
310     2.  Identifying the entities and individuals allowed to
311submit a written response.
312     3.  Identifying the circumstances under which the entity's
313or individual's response must be attached to the agency
314inspector general's final report.
315     4.  Providing a review process that allows entities and
316individuals substantially affected by the findings, conclusions,
317and recommendations of an agency inspector general final
318investigative report to present to the Chief Inspector General,
319or a designee, any additional material relevant to the final
320investigative report.
321     5.  Allowing the Chief Inspector General to independently
322investigate the agency inspector general's final report and the
323original investigation.
324     6.  Special conditions for whistle-blower investigations in
325accordance with ss. 112.3187-112.31895.
326     7.  Exemptions from the review process for specific
327categories of investigations.
328     8.  Definitions of terms related to the review process.
329     (b)  Ensure that policies and procedures adopted pursuant
330to this subsection are consistent with the recommendations
331contained in the report of the Council on State Agency
332Inspectors General dated December 19, 2006.
333     (9)(8)  Each agency inspector general shall, to the extent
334both necessary and practicable, include on his or her staff
335individuals with electronic data processing auditing experience.
336     Section 2.  This act shall take effect July 1, 2007.


CODING: Words stricken are deletions; words underlined are additions.