Florida Senate - 2017                             CS for SB 1478
       By the Committee on Governmental Oversight and Accountability;
       and Senator Baxley
       585-03974-17                                          20171478c1
    1                        A bill to be entitled                      
    2         An act relating to inspectors general and auditors;
    3         amending s. 14.32, F.S.; requiring the Chief Inspector
    4         General to meet specified qualifications applicable to
    5         agency inspectors general, to have open and direct
    6         access to the Governor, and to prepare an annual
    7         report containing specified information; amending s.
    8         20.055, F.S.; revising the qualifications of agency
    9         inspectors general; revising the auditing duties and
   10         responsibilities of agency inspectors general to
   11         include the performance of information technology
   12         audits; authorizing an agency inspector general and
   13         staff to take and record testimony or statements
   14         necessary to conduct an investigation or a review;
   15         requiring each agency inspector general to include
   16         specified budgetary and staffing information in an
   17         annual report; revising terminology; amending s.
   18         110.205, F.S.; exempting employees of an office of an
   19         agency inspector general and auditors of the Division
   20         of Accounting and Auditing of the Department of
   21         Financial Services from the Career Service System;
   22         providing an effective date.
   24  Be It Enacted by the Legislature of the State of Florida:
   26         Section 1. Subsection (1) of section 14.32, Florida
   27  Statutes, is amended, and paragraph (l) is added to subsection
   28  (2) of that section, to read:
   29         14.32 Office of Chief Inspector General.—
   30         (1) There is created in the Executive Office of the
   31  Governor the Office of Chief Inspector General. The Chief
   32  Inspector General is responsible for promoting accountability,
   33  integrity, and efficiency in the agencies under the jurisdiction
   34  of the Governor. The Chief Inspector General shall be appointed
   35  by and serve at the pleasure of the Governor and must meet the
   36  qualifications specified in s. 20.055(4). However, upon a change
   37  in Governors or reelection of the Governor, the Governor shall
   38  appoint, or may reappoint, a Chief Inspector General before
   39  adjournment sine die of the first regular session of the
   40  Legislature that convenes after such change in Governors or
   41  reelection of the Governor. The Chief Inspector General shall,
   42  at all times, have open and direct access to the Governor.
   43         (2) The Chief Inspector General shall:
   44         (l) Prepare an annual report that summarizes the activities
   45  performed in compliance with this section and includes an
   46  aggregate of significant budgetary or administrative changes
   47  contained in annual reports prepared by inspectors general for
   48  state agencies under the jurisdiction of the Governor pursuant
   49  to s. 20.055(8).
   50         Section 2. Subsections (4), (6), and (7), paragraph (c) of
   51  subsection (8), and subsection (10) of section 20.055, Florida
   52  Statutes, are amended to read:
   53         20.055 Agency inspectors general.—
   54         (4)(a) To ensure that state agency audits are performed in
   55  accordance with applicable auditing standards, the inspector
   56  general or the director of auditing within the inspector
   57  general’s office shall possess the following qualifications:
   58         1. A bachelor’s degree from an accredited college or
   59  university with a major in accounting, or with a major in
   60  business which includes five courses in accounting, and 5 years
   61  of experience as an internal auditor or independent postauditor,
   62  information technology electronic data processing auditor,
   63  accountant, or any combination thereof. The experience shall at
   64  a minimum consist of audits of units of government or private
   65  business enterprises, operating for profit or not for profit; or
   66         2. A master’s degree in accounting, business
   67  administration, or public administration from an accredited
   68  college or university and 4 years of experience as required in
   69  subparagraph 1.; or
   70         3. A certified public accountant license issued pursuant to
   71  chapter 473 or a certified internal audit certificate issued by
   72  the Institute of Internal Auditors or earned by examination, and
   73  4 years of experience as required in subparagraph 1.
   74         (b) For agencies under the jurisdiction of the Governor,
   75  the inspector general shall be selected on the basis of
   76  integrity, leadership capability, and experience in accounting,
   77  auditing, fraud examination, financial analysis, law, management
   78  analysis, program evaluation, public administration,
   79  investigation, criminal justice administration, or other closely
   80  related field. The inspector general is subject to a level 2
   81  background screening pursuant to chapter 435. The inspector
   82  general shall have a 4-year degree from an accredited
   83  institution of higher learning or have at least 5 years of
   84  experience in at least one of the following areas:
   85         1. Inspector general.
   86         2. Supervisory experience in an office of inspector general
   87  or an investigative public agency similar to an office of
   88  inspector general.
   89         3. Local, state, or federal law enforcement officer.
   90         4. Local, state, or federal court judge.
   91         5. Senior-level auditor or comptroller.
   92         6. The administration and management of complex audits and
   93  investigations.
   94         7. Managing programs for information security, prevention,
   95  examination, detection, elimination of fraud, waste, abuse,
   96  mismanagement, malfeasance, or misconduct in government or other
   97  organizations.
   99  An advanced degree in law, accounting, public administration, or
  100  other relevant field may substitute for 1 year of required
  101  experience.
  102         (c) The inspector general shall possess at appointment, or
  103  obtain within the first year after appointment, a certification
  104  from the Association of Inspectors General as a certified
  105  inspector general. The inspector general must have one or more
  106  other professional certifications, such as certified inspector
  107  general investigator, certified inspector general auditor,
  108  certified public accountant, certified internal auditor,
  109  certified governmental financial manager, or certified fraud
  110  examiner, certified financial crimes investigator or other
  111  related certification, or be a licensed attorney.
  112         (d) The inspector general may not hold, or be a candidate
  113  for, an elective office of the state or a municipality, county,
  114  or other political subdivision of the state while inspector
  115  general, and a current officer or employee of an office of
  116  inspector general may not hold, or be a candidate for, an
  117  elective office of the state or a municipality, county, or other
  118  political subdivision of the state. The inspector general shall
  119  be appointed without regard to political affiliation. The
  120  inspector general may not hold office in a political party or
  121  political committee. An employee of an office of inspector
  122  general may not hold office in a political party or political
  123  committee while employed in the office of inspector general.
  124         (6) In carrying out the auditing duties and
  125  responsibilities of this section act, each inspector general
  126  shall review and evaluate internal controls necessary to ensure
  127  the fiscal accountability of the state agency. The inspector
  128  general shall conduct financial, compliance, information
  129  technology electronic data processing, and performance audits of
  130  the agency and prepare audit reports of his or her findings. The
  131  scope and assignment of the audits shall be determined by the
  132  inspector general; however, the agency head may at any time
  133  request the inspector general to perform an audit of a special
  134  program, function, or organizational unit. The performance of
  135  the audit shall be under the direction of the inspector general,
  136  except that if the inspector general does not possess the
  137  qualifications specified in subsection (4), the director of
  138  auditing shall perform the functions listed in this subsection.
  139         (a) Such audits shall be conducted in accordance with the
  140  current International Standards for the Professional Practice of
  141  Internal Auditing as published by the Institute of Internal
  142  Auditors, Inc., or, where appropriate, in accordance with
  143  generally accepted governmental auditing standards. All audit
  144  reports issued by internal audit staff shall include a statement
  145  that the audit was conducted pursuant to the appropriate
  146  standards.
  147         (b) Audit workpapers and reports shall be public records to
  148  the extent that they do not include information which has been
  149  made confidential and exempt from the provisions of s. 119.07(1)
  150  pursuant to law. However, when the inspector general or a member
  151  of the staff receives from an individual a complaint or
  152  information that falls within the definition provided in s.
  153  112.3187(5), the name or identity of the individual may not be
  154  disclosed to anyone else without the written consent of the
  155  individual, unless the inspector general determines that such
  156  disclosure is unavoidable during the course of the audit or
  157  investigation.
  158         (c) The inspector general and the staff shall have access
  159  to any records, data, and other information of the state agency
  160  he or she deems necessary to carry out his or her duties. The
  161  inspector general may also request such information or
  162  assistance as may be necessary from the state agency or from any
  163  federal, state, or local government entity.
  164         (d) At the conclusion of each audit, the inspector general
  165  shall submit preliminary findings and recommendations to the
  166  person responsible for supervision of the program function or
  167  operational unit who shall respond to any adverse findings
  168  within 20 working days after receipt of the preliminary
  169  findings. Such response and the inspector general’s rebuttal to
  170  the response shall be included in the final audit report.
  171         (e) At the conclusion of an audit in which the subject of
  172  the audit is a specific entity contracting with the state or an
  173  individual substantially affected, if the audit is not
  174  confidential or otherwise exempt from disclosure by law, the
  175  inspector general shall, consistent with s. 119.07(1), submit
  176  the findings to the entity contracting with the state or the
  177  individual substantially affected, who shall be advised in
  178  writing that they may submit a written response within 20
  179  working days after receipt of the findings. The response and the
  180  inspector general’s rebuttal to the response, if any, must be
  181  included in the final audit report.
  182         (f) The inspector general shall submit the final report to
  183  the agency head, the Auditor General, and, for state agencies
  184  under the jurisdiction of the Governor, the Chief Inspector
  185  General.
  186         (g) The Auditor General, in connection with the independent
  187  postaudit of the same agency pursuant to s. 11.45, shall give
  188  appropriate consideration to internal audit reports and the
  189  resolution of findings therein. The Legislative Auditing
  190  Committee may inquire into the reasons or justifications for
  191  failure of the agency head to correct the deficiencies reported
  192  in internal audits that are also reported by the Auditor General
  193  and shall take appropriate action.
  194         (h) The inspector general shall monitor the implementation
  195  of the state agency’s response to any report on the state agency
  196  issued by the Auditor General or by the Office of Program Policy
  197  Analysis and Government Accountability. No later than 6 months
  198  after the Auditor General or the Office of Program Policy
  199  Analysis and Government Accountability publishes a report on the
  200  state agency, the inspector general shall provide a written
  201  response to the agency head or, for state agencies under the
  202  jurisdiction of the Governor, the Chief Inspector General on the
  203  status of corrective actions taken. The inspector general shall
  204  file a copy of such response with the Legislative Auditing
  205  Committee.
  206         (i) The inspector general shall develop long-term and
  207  annual audit plans based on the findings of periodic risk
  208  assessments. The plan, where appropriate, should include
  209  postaudit samplings of payments and accounts. The plan shall
  210  show the individual audits to be conducted during each year and
  211  related resources to be devoted to the respective audits. The
  212  Chief Financial Officer, to assist in fulfilling the
  213  responsibilities for examining, auditing, and settling accounts,
  214  claims, and demands pursuant to s. 17.03(1), and examining,
  215  auditing, adjusting, and settling accounts pursuant to s. 17.04,
  216  may use audits performed by the inspectors general and internal
  217  auditors. For state agencies under the jurisdiction of the
  218  Governor, the audit plans shall be submitted to the Chief
  219  Inspector General. The plan shall be submitted to the agency
  220  head for approval. A copy of the approved plan shall be
  221  submitted to the Auditor General.
  222         (7)(a) In carrying out the investigative duties and
  223  responsibilities specified in this section, each inspector
  224  general shall initiate, conduct, supervise, and coordinate
  225  investigations designed to detect, deter, prevent, and eradicate
  226  fraud, waste, mismanagement, misconduct, and other abuses in
  227  state government. For these purposes, each inspector general
  228  shall:
  229         1.(a) Receive complaints and coordinate all activities of
  230  the agency as required by the Whistle-blower’s Act pursuant to
  231  ss. 112.3187-112.31895.
  232         2.(b) Receive and consider the complaints that which do not
  233  meet the criteria for an investigation under the Whistle
  234  blower’s Act and conduct, supervise, or coordinate such
  235  inquiries, investigations, or reviews as the inspector general
  236  deems appropriate.
  237         3.(c) Report expeditiously to the Department of Law
  238  Enforcement or other law enforcement agencies, as appropriate,
  239  whenever the inspector general has reasonable grounds to believe
  240  that there has been a violation of criminal law.
  241         4.(d) Conduct investigations and other inquiries free of
  242  actual or perceived impairment to the independence of the
  243  inspector general or the inspector general’s office. This shall
  244  include freedom from any interference with investigations and
  245  timely access to records and other sources of information.
  246         5.(e) At the conclusion of each investigation in which the
  247  subject of the investigation is a specific entity contracting
  248  with the state or an individual substantially affected as
  249  defined by this section, and if the investigation is not
  250  confidential or otherwise exempt from disclosure by law, the
  251  inspector general shall, consistent with s. 119.07(1), submit
  252  findings to the subject that is a specific entity contracting
  253  with the state or an individual substantially affected, who
  254  shall be advised in writing that they may submit a written
  255  response within 20 working days after receipt of the findings.
  256  Such response and the inspector general’s rebuttal to the
  257  response, if any, shall be included in the final investigative
  258  report.
  259         6.(f) Submit in a timely fashion final reports on
  260  investigations conducted by the inspector general to the agency
  261  head, except for whistle-blower’s investigations, which shall be
  262  conducted and reported pursuant to s. 112.3189.
  263         (b) The inspector general and his or her staff may take and
  264  record testimony or statements of any person as reasonably
  265  necessary for the furtherance of an investigation or a review
  266  undertaken by the inspector general.
  267         (8)
  268         (c) The final reports prepared pursuant to paragraphs (a)
  269  and (b) shall be provided to the heads of the respective
  270  agencies and, for state agencies under the jurisdiction of the
  271  Governor, the Chief Inspector General. Such reports shall
  272  include, but need not be limited to:
  273         1. A description of activities relating to the development,
  274  assessment, and validation of performance measures.
  275         2. A description of significant abuses and deficiencies
  276  relating to the administration of programs and operations of the
  277  agency disclosed by investigations, audits, reviews, or other
  278  activities during the reporting period.
  279         3. A description of the recommendations for corrective
  280  action made by the inspector general during the reporting period
  281  with respect to significant problems, abuses, or deficiencies
  282  identified.
  283         4. The identification of each significant recommendation
  284  described in previous annual reports on which corrective action
  285  has not been completed.
  286         5. A summary of each audit and investigation completed
  287  during the reporting period.
  288         6. Any increase or decrease in the total allocations or
  289  total expenditures in the inspector general’s budget for the
  290  preceding state fiscal year compared to the total allocations or
  291  total expenditures in the budget for the prior state fiscal year
  292  and any increase or decrease in the number of permanent,
  293  temporary, loaned, grant-funded, or full-time equivalent staff
  294  within the office of the inspector general.
  295         (10) Each agency inspector general shall, to the extent
  296  both necessary and practicable, include on his or her staff
  297  individuals with information technology electronic data
  298  processing auditing experience.
  299         Section 3. Paragraphs (y) and (z) are added to subsection
  300  (2) of section 110.205, Florida Statutes, to read:
  301         110.205 Career service; exemptions.—
  302         (2) EXEMPT POSITIONS.—The exempt positions that are not
  303  covered by this part include the following:
  304         (y) All employees of an office of an agency inspector
  305  general shall be assigned to the Selected Exempt Service, except
  306  for agency inspectors general, who shall be included in the
  307  Senior Management Service.
  308         (z) Auditors employed within the Division of Accounting and
  309  Auditing of the Department of Financial Services. Unless
  310  otherwise fixed by law, the Department of Financial Services
  311  shall establish the salary and benefits for these positions in
  312  accordance with the rules established for the Selected Exempt
  313  Service.
  314         Section 4. This act shall take effect July 1, 2017.