Florida Senate - 2017                                    SB 1478
       By Senator Baxley
       12-01483-17                                           20171478__
    1                        A bill to be entitled                      
    2         An act relating to inspectors general and auditors;
    3         amending s. 14.32, F.S.; removing a provision that
    4         requires the Chief Inspector General to serve at the
    5         pleasure of the Governor; authorizing the termination
    6         of the Chief Inspector General’s appointment by a
    7         majority vote of both houses of the Legislature;
    8         requiring the Chief Inspector General to meet
    9         specified qualifications applicable to agency
   10         inspectors general; requiring the Chief Inspector
   11         General to prepare an annual report containing
   12         specified information; amending s. 20.055, F.S.;
   13         revising definitions; revising provisions relating to
   14         duties and responsibilities of agency inspectors
   15         general to include forensic audits; providing that an
   16         investigator or auditor employed within an office of
   17         the inspector general is a Selected Exempt Service
   18         employee; revising the qualifications of agency
   19         inspectors general; conforming provisions; requiring
   20         each agency inspector general to include specified
   21         budgetary and staffing information in an annual
   22         report; amending s. 20.121, F.S.; providing that an
   23         auditor employed within the Division of Accounting and
   24         Auditing of the Department of Financial Services is a
   25         Selected Exempt Service employee; amending s. 215.44,
   26         F.S.; requiring the State Board of Administration to
   27         appoint an inspector general; providing duties and
   28         responsibilities for the inspector general necessary
   29         to conduct investigations; providing an effective
   30         date.
   32  Be It Enacted by the Legislature of the State of Florida:
   34         Section 1. Subsection (1) of section 14.32, Florida
   35  Statutes, is amended, and paragraph (l) is added to subsection
   36  (2) of that section, to read:
   37         14.32 Office of Chief Inspector General.—
   38         (1) There is created in the Executive Office of the
   39  Governor the Office of Chief Inspector General. The Chief
   40  Inspector General is responsible for promoting accountability,
   41  integrity, and efficiency in the agencies under the jurisdiction
   42  of the Governor. The Chief Inspector General shall be appointed
   43  by and serve at the pleasure of the Governor and must meet the
   44  qualifications specified in s. 20.055(4). The appointment of the
   45  Chief Inspector General may be terminated at any time by a
   46  majority vote of both houses of the Legislature. However, upon a
   47  change in Governors or reelection of the Governor, the Governor
   48  shall appoint, or may reappoint, a Chief Inspector General
   49  before adjournment sine die of the first regular session of the
   50  Legislature that convenes after such change in Governors or
   51  reelection of the Governor.
   52         (2) The Chief Inspector General shall:
   53         (l)Prepare an annual report that summarizes the activities
   54  performed in compliance with this section and includes an
   55  aggregate of significant budgetary or administrative changes
   56  contained in annual reports prepared by inspectors general for
   57  state agencies under the jurisdiction of the Governor pursuant
   58  to s. 20.055(8).
   59         Section 2. Paragraphs (a) and (d) of subsection (1),
   60  paragraph (d) of subsection (2), paragraph (b) of subsection
   61  (3), paragraph (b) of subsection (4), subsection (6), and
   62  paragraph (c) of subsection (8) of section 20.055, Florida
   63  Statutes, are amended to read:
   64         20.055 Agency inspectors general.—
   65         (1) As used in this section, the term:
   66         (a) “Agency head” means the Governor, a Cabinet officer, or
   67  a secretary or executive director as those terms are defined in
   68  s. 20.03, the chair of the Public Service Commission, the
   69  Director of the Office of Insurance Regulation of the Financial
   70  Services Commission, the Director of the Office of Financial
   71  Regulation of the Financial Services Commission, the board of
   72  directors of the Florida Housing Finance Corporation, the
   73  executive director of the Office of Early Learning, the
   74  executive director of the State Board of Administration, and the
   75  Chief Justice of the State Supreme Court.
   76         (d) “State agency” means each department created pursuant
   77  to this chapter and the Executive Office of the Governor, the
   78  Department of Military Affairs, the Fish and Wildlife
   79  Conservation Commission, the Office of Insurance Regulation of
   80  the Financial Services Commission, the Office of Financial
   81  Regulation of the Financial Services Commission, the Public
   82  Service Commission, the Board of Governors of the State
   83  University System, the Florida Housing Finance Corporation, the
   84  Agency for State Technology, the Office of Early Learning, the
   85  State Board of Administration, and the state courts system.
   86         (2) An office of inspector general is established in each
   87  state agency to provide a central point for coordination of and
   88  responsibility for activities that promote accountability,
   89  integrity, and efficiency in government. It is the duty and
   90  responsibility of each inspector general, with respect to the
   91  state agency in which the office is established, to:
   92         (d) Provide direction for, supervise, and coordinate
   93  audits, forensic audits, investigations, and management reviews
   94  relating to the programs and operations of the state agency,
   95  except that when the inspector general does not possess the
   96  qualifications specified in subsection (4), the director of
   97  auditing shall conduct such audits.
   98         (3)
   99         (b) The inspector general shall report to and be under the
  100  general supervision of the agency head and is not subject to
  101  supervision by any other employee of the state agency in which
  102  the office is established. For state agencies under the
  103  jurisdiction of the Governor, the inspector general shall be
  104  under the general supervision of the agency head for
  105  administrative purposes, shall report to the Chief Inspector
  106  General, and may hire and remove staff within the office of the
  107  inspector general in consultation with the Chief Inspector
  108  General but independently of the agency. Any investigator or
  109  auditor employed within the office of an inspector general is
  110  included in the Selected Exempt Service as provided in chapter
  111  110.
  112         (4)
  113         (b) For agencies under the jurisdiction of the Governor,
  114  the inspector general shall be selected on the basis of
  115  integrity, leadership capability, and experience in accounting,
  116  auditing, forensic auditing, financial analysis, law, management
  117  analysis, program evaluation, public administration,
  118  investigation, criminal justice administration, or other closely
  119  related field. The inspector general is subject to a level 2
  120  background screening pursuant to chapter 435. The inspector
  121  general shall have a 4-year degree from an accredited
  122  institution of higher learning or have at least 5 years of
  123  experience in at least one of the following areas:
  124         1. Inspector general.
  125         2. Supervisory experience in an office of inspector general
  126  or an investigative public agency similar to an office of
  127  inspector general.
  128         3. Local, state, or federal law enforcement officer.
  129         4. Local, state, or federal court judge.
  130         5. Senior-level auditor or comptroller.
  131         6. The administration and management of complex audits and
  132  investigations.
  133         7. Managing programs for prevention, examination,
  134  detection, elimination of fraud, waste, abuse, mismanagement,
  135  malfeasance, or misconduct in government or other organizations.
  136         8.Certified fraud examiner.
  138  An advanced degree in law, accounting, public administration, or
  139  other relevant field may substitute for 1 year of required
  140  experience.
  141         (6) In carrying out the auditing duties and
  142  responsibilities of this section act, each inspector general
  143  shall review and evaluate internal controls necessary to ensure
  144  the fiscal accountability of the state agency. The inspector
  145  general shall conduct financial, compliance, electronic data
  146  processing, and forensic or performance audits of the agency and
  147  prepare audit reports of his or her findings. The scope and
  148  assignment of the audits shall be determined by the inspector
  149  general; however, the agency head may at any time request the
  150  inspector general to perform an audit of a special program,
  151  function, or organizational unit. The performance of the audit
  152  shall be under the direction of the inspector general, except
  153  that if the inspector general does not possess the
  154  qualifications specified in subsection (4), the director of
  155  auditing shall perform the functions listed in this subsection.
  156         (a) Such audits shall be conducted in accordance with the
  157  current International Standards for the Professional Practice of
  158  Internal Auditing as published by the Institute of Internal
  159  Auditors, Inc., or, where appropriate, in accordance with
  160  generally accepted governmental auditing standards. All audit
  161  reports issued by internal audit staff shall include a statement
  162  that the audit was conducted pursuant to the appropriate
  163  standards.
  164         (b) Audit workpapers and reports shall be public records to
  165  the extent that they do not include information which has been
  166  made confidential and exempt from the provisions of s. 119.07(1)
  167  pursuant to law. However, when the inspector general or a member
  168  of the staff receives from an individual a complaint or
  169  information that falls within the definition provided in s.
  170  112.3187(5), the name or identity of the individual may not be
  171  disclosed to anyone else without the written consent of the
  172  individual, unless the inspector general determines that such
  173  disclosure is unavoidable during the course of the audit or
  174  investigation.
  175         (c) The inspector general and the staff shall have access
  176  to any records, data, and other information of the state agency
  177  he or she deems necessary to carry out his or her duties. The
  178  inspector general may also request such information or
  179  assistance as may be necessary from the state agency or from any
  180  federal, state, or local government entity.
  181         (d) At the conclusion of each audit, the inspector general
  182  shall submit preliminary findings and recommendations to the
  183  person responsible for supervision of the program function or
  184  operational unit who shall respond to any adverse findings
  185  within 20 working days after receipt of the preliminary
  186  findings. Such response and the inspector general’s rebuttal to
  187  the response shall be included in the final audit report.
  188         (e) At the conclusion of an audit in which the subject of
  189  the audit is a specific entity contracting with the state or an
  190  individual substantially affected, if the audit is not
  191  confidential or otherwise exempt from disclosure by law, the
  192  inspector general shall, consistent with s. 119.07(1), submit
  193  the findings to the entity contracting with the state or the
  194  individual substantially affected, who shall be advised in
  195  writing that they may submit a written response within 20
  196  working days after receipt of the findings. The response and the
  197  inspector general’s rebuttal to the response, if any, must be
  198  included in the final audit report.
  199         (f) The inspector general shall submit the final report to
  200  the agency head, the Auditor General, and, for state agencies
  201  under the jurisdiction of the Governor, the Chief Inspector
  202  General.
  203         (g) The Auditor General, in connection with the independent
  204  postaudit of the same agency pursuant to s. 11.45, shall give
  205  appropriate consideration to internal audit reports and the
  206  resolution of findings therein. The Legislative Auditing
  207  Committee may inquire into the reasons or justifications for
  208  failure of the agency head to correct the deficiencies reported
  209  in internal audits that are also reported by the Auditor General
  210  and shall take appropriate action.
  211         (h) The inspector general shall monitor the implementation
  212  of the state agency’s response to any report on the state agency
  213  issued by the Auditor General or by the Office of Program Policy
  214  Analysis and Government Accountability. No later than 6 months
  215  after the Auditor General or the Office of Program Policy
  216  Analysis and Government Accountability publishes a report on the
  217  state agency, the inspector general shall provide a written
  218  response to the agency head or, for state agencies under the
  219  jurisdiction of the Governor, the Chief Inspector General on the
  220  status of corrective actions taken. The inspector general shall
  221  file a copy of such response with the Legislative Auditing
  222  Committee.
  223         (i) The inspector general shall develop long-term and
  224  annual audit plans based on the findings of periodic risk
  225  assessments. The plan, where appropriate, should include
  226  postaudit samplings of payments and accounts. The plan shall
  227  show the individual audits to be conducted during each year and
  228  related resources to be devoted to the respective audits. The
  229  Chief Financial Officer, to assist in fulfilling the
  230  responsibilities for examining, auditing, and settling accounts,
  231  claims, and demands pursuant to s. 17.03(1), and examining,
  232  auditing, adjusting, and settling accounts pursuant to s. 17.04,
  233  may use audits performed by the inspectors general and internal
  234  auditors. For state agencies under the jurisdiction of the
  235  Governor, the audit plans shall be submitted to the Chief
  236  Inspector General. The plan shall be submitted to the agency
  237  head for approval. A copy of the approved plan shall be
  238  submitted to the Auditor General.
  239         (8)
  240         (c) The final reports prepared pursuant to paragraphs (a)
  241  and (b) shall be provided to the heads of the respective
  242  agencies and, for state agencies under the jurisdiction of the
  243  Governor, the Chief Inspector General. Such reports shall
  244  include, but need not be limited to:
  245         1. A description of activities relating to the development,
  246  assessment, and validation of performance measures.
  247         2. A description of significant abuses and deficiencies
  248  relating to the administration of programs and operations of the
  249  agency disclosed by investigations, audits, reviews, or other
  250  activities during the reporting period.
  251         3. A description of the recommendations for corrective
  252  action made by the inspector general during the reporting period
  253  with respect to significant problems, abuses, or deficiencies
  254  identified.
  255         4. The identification of each significant recommendation
  256  described in previous annual reports on which corrective action
  257  has not been completed.
  258         5. A summary of each audit and investigation completed
  259  during the reporting period.
  260         6.Any increase or decrease in expenditures estimating 10
  261  percent or more of the inspector general’s total budget during
  262  the preceding state fiscal year and any significant increase or
  263  decrease in the number of permanent, temporary, loaned, or
  264  grant-funded, full-time equivalent staff within the office of
  265  the inspector general.
  266         Section 3. Paragraph (a) of subsection (2) of section
  267  20.121, Florida Statutes, is amended to read:
  268         20.121 Department of Financial Services.—There is created a
  269  Department of Financial Services.
  270         (2) DIVISIONS.—The Department of Financial Services shall
  271  consist of the following divisions and office:
  272         (a) The Division of Accounting and Auditing. Any auditor
  273  employed within the division is included in the Selected Exempt
  274  Service as provided in chapter 110.
  275         Section 4. Present paragraphs (d) and (e) of subsection (2)
  276  of section 215.44, Florida Statutes, are redesignated as
  277  paragraphs (e) and (f), respectively, and a new paragraph (d) is
  278  added to that subsection, to read:
  279         215.44 Board of Administration; powers and duties in
  280  relation to investment of trust funds.—
  281         (2)
  282         (d)The board shall appoint an inspector general who shall
  283  perform the duties and responsibilities required in s. 20.055.
  284  The office of inspector general shall assess and resolve
  285  grievances and conduct internal affairs investigations and
  286  management reviews. The inspector general, or his or her
  287  designee, may enter any place where the board has an office and
  288  may review files, consult with employees, or obtain any
  289  information as necessary to conduct an investigation.
  290         Section 5. This act shall take effect July 1, 2017.