Peter’s Take is a weekly opinion column. The views and opinions expressed in this column are those of the author and do not necessarily reflect the views of ARLnow.com.
On June 19, the Arlington County Board unanimously approved County Auditor Chris Horton’s Audit Work Plan.
Serving the independent audit function, Horton prepares performance audits, and reports directly to the County Board (not the County Manager) with guidance from the Audit Committee. The Audit Committee — comprising two County Board members, the County Manager, the Deptartment of Management and Finance Director plus three citizen-volunteers –oversees Horton’s work.
County Board member John Vihstadt played a leadership role in establishing the County Auditor position. He and Erik Gutshall serve as the current Board liaisons to the Audit Committee.
Off to a strong start
Horton’s latest report analyzes overtime payments at Arlington’s Emergency Communications Center (ECC). This audit makes important recommendations to improve efficiencies, and underscores the value and usefulness of performance audits.
Differences between the County Auditor and other auditors
The County Manager’s internal auditors look only for technical problems in the County’s financial and control systems:
- Are things being accounted for and entered into financial systems correctly?
- Are internal control systems operating to catch errors and irregularities?
Even the county’s external auditor issues only periodic, boilerplate opinion letters that reinforce the limited scope of its review.
Reporting responsibility outside of the normal management lines of authority provides an important check on our financial systems. See: “How should the audit committee be structured?”
County Auditor needs more resources
Horton’s Work Plan contains a series of hierarchical audit tiers, totaling approximately 18 potential audits. Based upon Horton’s own comments before the Board and logic, Horton, operating alone, probably will be able to prepare and publish only three, comprehensive audit reports between July 1, 2018 and June 30, 2019.
Thus, it would take Horton — operating alone — about 6 years to complete all 18 of the potential audits. Obviously, there are more than just these 18 audits that could yield significant dollar savings and efficiencies.
Nonpublic information I obtained from an Association of Local Government Auditors (ALGA) member confirms that an organization similar to Arlington County, with a $1.3 billion annual operating budget, should be devoting more than one, full-time, qualified auditor to the independent audit function.
Auditor/inspector general staffs that report directly to elected officials — if adequately funded — can identify savings that would more than cover their operating costs. Fairfax’s Office of Auditor of the Board has three auditors (including the Auditor of the Board). With three full-time auditors, you can see how much work it is possible to accomplish.
Conclusion
With Horton’s current constraints (e.g., no staff, a very limited budget, etc.), the county is underutilizing this important resource at the very moment it is needed most.
This is a concern. See “Why Government Watchdogs Are Worried”:
ALGA deals with these concerns all the time. When performance auditors rile mayors and department heads with negative audits, retaliation can come in the form of budget cuts, slow action on personnel requests or even suggestions that auditor functions be eliminated. David Jones, Seattle city auditor and chair of ALGA’s advocacy committee, says, “We frequently find that local government auditors are under attack.”
To get the best bang from our finite bucks, Arlington must add at least one (and eventually two) full-time, qualified assistant auditors to support the County Auditor and increase the annual performance audit output.