UCSC FY 2001-2002 AUDIT PLAN

UCSC FY 2001-2002 AUDIT PLAN

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Risk Based Audit Work Group FY 2002 GUIDELINES-DEFINTIONS & ANNUAL RESOURCE ALLOCATIONS Annual Resource Allocations ATTACHMENT F UNIVERSITY OF CALIFORNIA INTERNAL AUDIT PLAN 2001-2002 NARRATIVE & ASSUMPTIONS (Santa Cruz “Obviously, the best audit office in the system”) ______________________________________________________________________________ 1. Available Hours--Describe the basis for the number of FTE’s in the plan including any change from current year staffing levels, time frame for filling open positions, assumed turnover and impact on available hours, and any positions authorized but intentionally left open for necessary salary savings. Separately describe the basis for any hours in the “Other Resources category; e.g. temporary assistance, interns, paid or unpaid overtime, or re-charge to another internal audit department (negative). The staffing for 2001-2002 is based upon our budget request issued last month to campus administration. VC-Vani stated that we should assume receiving the funds to enable us to increase the FTE for auditor Dougherty from .75 to 1.0 FTE and to fund increases in salaries for the remaining staff. We have one open provision that is inadequately funded currently for a non-professional (administrative analyst). We will not recruit for this position until we receive final budget approval during May or June. Thus, except for employing a student intern, we have been without administrative support since Cindy ...

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Risk Based Audit Work Group
FY 2002 GUIDELINES-DEFINTIONS & ANNUAL RESOURCE ALLOCATIONS
Annual Resource Allocations
ATTACHMENT F
UNIVERSITY OF CALIFORNIA
INTERNAL AUDIT PLAN
2001-2002 NARRATIVE & ASSUMPTIONS
(Santa Cruz “Obviously, the best audit office in the system”)
______________________________________________________________________________
1.
Available Hours
--
Describe the basis for the number of FTE’s in the plan including any change from
current year staffing levels, time frame for filling open positions, assumed turnover and impact on
available hours, and any positions authorized but intentionally left open for necessary salary savings.
Separately describe the basis for any hours in the “Other Resources category; e.g. temporary assistance,
interns, paid or unpaid overtime, or re-charge to another internal audit department (negative).
The staffing for 2001-2002 is based upon our budget request issued last month to campus
administration. VC-Vani stated that we should assume receiving the funds to enable us
to increase the FTE for auditor Dougherty from .75 to 1.0 FTE and to fund increases in
salaries for the remaining staff. We have one open provision that is inadequately funded
currently for a non-professional (administrative analyst). We will not recruit for this
position until we receive final budget approval during May or June. Thus, except for
employing a student intern, we have been without administrative support since Cindy
Fernandez-Cohn left during September 2000. We just hired everyone and I am assuming
that we can keep them at least for this year! (Thus, no turnovers are assumed in my
budget).
This summer, we will employ full-time Kevin Lagenberger, our student intern. This is
shown as the temporary 1.0 FTE for first quarter. We are not budgeting for his assistance
outside of this time, as most of his assistance is clerical or administrative.
2.
Indirect Hours
--
Describe any unusual variances from expected norms. For example, Non-
Controllable time which is budgeted differently from leave permitted by H.R. policies, Professional
Development different from guidelines, or other reflecting the impact from an office relocation etc.
Comment on the manner in which Director’s time is allocated to administration versus audit projects,
especially if the overall indirect percentage is unusually high (greater than 20%) or low (less than 10%).
The non-controllable hours budgeted are low, because the staff have few hours
accumulated yet for leave.) Administration is higher than our usual, because of the new
staff and time allocated for supervision. Training is budgeted at 60 hours per staff, as
staff are new.
3.
Audit Program
--
Comment on coverage of the Audit Universe and its high-risk components, using
statistics from Attachment F-4 (Schedule 4 Plan Statistics), as appropriate. Comment also on the basis for
the hours assumed in Supplemental Audits.
Note
that while Supplemental Audits is intended to
acknowledge the dynamic nature of our environment--and also our on-going risk assessment--it is not
intended to undermine our ability to audit highly ranked risks or mask accountability for our time.
Comment also on the extent of obligated time versus time freely available to assign by the Audit Director
on a risk assessment basis.
This year, we will cover all the times in the high-risk area (12 new items and 3 high risk
items from carryover reviews). We also will cover 7 of the 17 core elements or 41
percent. This will be accomplished during 3 new audits, one carryover audit and one
Page 1 of 4
UCSC 2002 Plan Narrative.doc
Risk Based Audit Work Group
FY 2002 GUIDELINES-DEFINTIONS & ANNUAL RESOURCE ALLOCATIONS
Annual Resource Allocations
ATTACHMENT F
advisory service. Core audit subjects in the plan are: G.b.05 backup and recovery (data
center audit), Data center operations and operating system software (G.b04); logical
security (G.b.02), Payroll Processing E.g.01; Physical Security Data Center and
Networks (G.b06); Software acquisition (G.b.01)(AIS consultation) and Student fees and
receivables (H.f.06).
We budgeted 465 hours for supplemental audits, which is about 9.7 percent of our
planned audit program (of 4775). We are fully funded by 19900 and indirect/
administrative overhead. Thus, we are not obligated to do any special audits such as
auxiliary services. We are fully able to allocate audit time to risk ranked items.
4.
Advisory Services
--
Note IPA (Information Practices Act) and COI (Conflict of Interest Coordination)
activities would be reported here and are reflective of the roles assigned to UCSD and UCSC respectively.
However, any location expecting to spend time on these matters (outside of project specific time that should
be charged to the project) can budget and charge time here. Comment on material changes from historical
patterns if any are projected. Comment also if any projected change is a result of recharacterizing hours
historically charged elsewhere or on any efforts to promote Advisory Services in your environment.
Here at UCSC, I am the Conflict of Interest Coordinator. We have budgeted 160 hours
for this activity. Other planned consultations are: AIS system implementation team,
external audit coordination, Space inventory, MBEST financial statements,
Whistleblower policy implementation, and policy and procedures reviews. Hours for
advisory services are approximately the same as last year. I have very little flexibility to
devote more hours in my budget here, unless investigative time is less than budget.
5.
Investigations--
Comment on material changes from historical patterns if any are projected. If a basis
other than historical patterns was used to estimate investigations comment on that basis.
I have budgeted the recommended 10 percent of our direct time for investigations. This
year, our percent is a low of 5.4 percent to date. However, I am cautious about not
having more time allocated in case we do have an investigation.
6.
Support Activities
--
Quality Assurance may be used for local QA programs as well as the systemwide
program. However, care should be taken to charge time only for formal QA program efforts such as post
issuance report reviews, post completion checks for documentation and compliance with standards and
local procedures. It should not be charged for any project specific time that belongs in the project and is
not a substitute for supervision, secondary review or pre report issuance quality assurance measures.
Comment on the assumptions that drive significant hours in these categories and any variances from
historical or “normal” commitments of time in these categories. Examples might include an increase in
commitments to Quality Assurance teams, managers’ new assignments to systemwide workgroups and the
like.
I am scheduled for the Davis peer review in July and we will have our peer review during
the third quarter 2002. Since we have implemented TeamMate, our hours for computer
support have increased from 0 to 200. I plan on 160 hours for the system wide IT
committee efforts, which I hope is enough to cover the large amount of work that is
needed.
Page 2 of 4
UCSC 2002 Plan Narrative.doc
Risk Based Audit Work Group
FY 2002 GUIDELINES-DEFINTIONS & ANNUAL RESOURCE ALLOCATIONS
Annual Resource Allocations
ATTACHMENT F
7.
Total Direct Hours & Percent
--
Comment on the overall allocation of Direct Hours and the
commitment to an audit program aimed at providing basic audit coverage with principal audit emphasis on
highly ranked risks. Comment on the Direct Hour Percentage as a performance measure and the variance
from a benchmark of 85%.
UCSC is direct budget is 84.39 percent. This is close to the guide of 85 percent. We are
a little under on direct because of having new staff to train.
8.
Time Phasing Assumptions
--
Predictable variances from period to period should be accounted for
in your spread of hours. For instance, the holiday hours are predictable based on the local holiday
schedule. Other items, such as vacations, illness and other authorized time off are less predictable, but it
may nevertheless be your assumption that they do not flow evenly by quarter. It is suggested that you first
estimate total available hours by period, then estimate non-controllable and controllable hours (for such
things as scheduled CPE) to arrive at total hours available for direct audit activities before spreading the
annual plan total for Planned Audits and other direct activities. Remember that it is not necessary to
spread individual audits by quarter--time phasing is only requested at the Schedule 2 (Attachment F-2), not
Schedule 3 (Attachment F-3) level. Comment on significant assumptions made in spreading the annual plan
by quarter.
We assume that we will work primarily on carry forwards during the first quarter.
Vacations will be heavy during the summer. UCSC also has campus closure for a week
at Christmas time, thus the down time during second quarter. I anticipate the least
amount of vacations and training during 4
th
quarter and having an emphasis of
completing planned audits during this time. Thus, 4
th
quarter audit program budget is a
little higher than during the other quarters.
9.
Core Audit
--
Comment on recent (last three years) coverage of core audit topics, plans for core
coverage in the current year and any areas not covered by recent or planned coverage.
We will cover the core adequately if we establish this current plan.
Topic
Year done (due)
Audit number
Financial Aid
00-01
01-01
Back-up Recover
01-02
02-04
Data Center Operations
01-02
02-04
Logical Security
01-02
01-05
Payroll
96-97 and 01-02
02-12
Physical Security
01-02
01-05
Software acquisition
yearly
AIS consult
Student fees
01-02
01-07
Bank Accounts
99-00
00-98
Business Contracts
97-98
98-071
Cashiering
99-00
00-98
Database sys. Mgmt
None
Extramural accounting
96-97
96-004.25
Fund Raising
99-00
00-19
Low value purchasing
99-00
99-037
Purchase orders
98-99
99-037
Major Construction
00-01
00-09
Page 3 of 4
UCSC 2002 Plan Narrative.doc
Risk Based Audit Work Group
FY 2002 GUIDELINES-DEFINTIONS & ANNUAL RESOURCE ALLOCATIONS
Annual Resource Allocations
ATTACHMENT F
10.
Other Matters
--
Comment on the biggest variables that will drive the ultimate determination of your
ability to complete the annual plan. Such things may include significant contingencies that can’t be
predicted at this time; e.g. staffing contingencies, major external investigations on the horizon such as
PATH II, DOE directives, Internal Audits role in a CSA program, and the like. Comment also on the
capacity to handle additional work; e.g. to what extent do you consider the plan to be a stretch goal or
what level of contingency availability is built into the plan. Comment on any other matters that you deem
relevant to an understanding of your Annual Audit Plan.
UCSC has very little flexibility due to its small staffing size. If I lose any one person, I
lose approximately 25 percent of my audit time. In this year’s budget proposal, I have
requested about $86,000 to make up for low staff salaries and to permanently fund Susan
Debeling’s salary. Next year, I plan to ask for at least one more auditor. I will get some
flexibility by being creative and by use of interns and soft money when available.
* * *
Page 4 of 4
UCSC 2002 Plan Narrative.doc
UC-Santa Cruz
2001-2002 Audit Plan
Schedule 1 - Personnel
Gross & Net Available Hours Calculation
Total Year FTE's
1st Quarter
9/30/2001
2nd Quarter
12/31/2001
3rd Quarter
3/31/2002
4th Quarter
6/30/2002
Lab 9/30/02
Number of authorized professional staff
4.60
4.60
4.60
4.60
4.60
Number of Permanently OPEN Authorized Professional Staff
Positions
0.00
0.00
0.00
0.00
Number of professional positions at full staffing
4.60
4.60
4.60
4.60
4.60
PLANNED ACTUAL FTEs
Beginning of Period
4.60
4.60
4.60
4.60
4.60
Additions--Permanent
0.00
0.00
Additions--Temporary
0.00
0.00
0.00
0.00
0.00
Left--Within UC
0.00
(0.00)
Left--Outside UC
0.00
(0.00)
Retirements
0.00
(0.00)
Long-Term Leave
0.00
(0.00)
Estimated Staff Turnover
0.00
(0.00)
End of Period
4.60
4.60
4.60
4.60
4.60
0.00
GROSS & NET AVAILABLE HRS CALCULATION
Total Year Hours
1st Quarter
9/30/2001
2nd Qtr 12/31/2001
3rd Quarter
3/31/2002
4th Quarter
6/30/2002
Lab 9/30/02
Weighted Avg. FTE's
4.6
4.60
4.60
4.60
4.60
Hours in the period - Campus
2,080
520
528
512
520
Hours in the period - Lab
2,088
528
512
520
528
Subtotal - Lab / Campus
9,568
2392
2429
2355
2392
0
Other Resources:
Overtime
0
Contract Labor/Interns
520
520
Recharge In (or Out)
0
Admin. & Other
0
Subtotal
520
5
2
0
0
0
0
0
Gross Available Hours
10,088
2912
2429
2355
2392
0
Non Controllable Hours
1,160
320
320
320
200
Non Controllable Hours Percent
11.50%
10.99%
13.17%
13.59%
8.36%
-
Net Available Hours
8,928
2592
2109
2035
2192
0
Schedule 2 - Activity Report
Distribution of Net Available Hours
UCOP % Guideline Total Year Hours
1st Quarter
9/30/2001
2nd Quarter
12/31/2001
3rd Quarter
3/31/2002
4th Quarter
6/30/2002
Lab 9/30/02
INDIRECT HOURS
Administration
5--10%
1,083
393
230
230
230
Professional Development
2--5%
310
100
70
70
70
Other
0--3%
0
Total Indirect Hours
1,393
493
300
300
300
0
Total Indirect Percent
15%
15.61%
19.02%
14.23%
14.74%
13.70%
-
DIRECT HOURS
Audit Program
Planned Carried Forward Audits, PC
610
610
0
0
0
Planned New Audits, PN
3,700
834
939
785
1142
Supplemental Audits, PS
Approx 10%
465
0
145
145
175
Unplanned Carried Forward Audits, PU
0
0
0
0
0
Total Audit Program Hours
4,775
1444
1084
930
1317
0
Total Audit Program Percent
40--60%
53.48%
55.71%
51.40%
45.70%
60.08%
-
Advisory Services
Consultations/Spec. Projects, SC
730
160
220
200
150
Ext. Audit Coordination, SE
60
15
15
15
15
Internal Control & Accountability, SI
0
0
0
0
0
IPA, COI & Other, SP
160
40
40
40
40
Systems Dev., Reeingineering Teams, etc., SR
200
50
50
50
50
Total Advisory Services Hours
1,150
265
325
305
255
0
Total Advisory Services Percent
10--25%
12.88%
10.22%
15.41%
14.99%
11.63%
-
Investigations Hours, IN
900
200
300
200
200
Investigations Percent
10--20%
10.08%
7.72%
14.22%
9.83%
9.12%
-
Audit Support Activities
Audit Planning
100
0
0
80
20
Audit Committee Support
40
10
10
10
10
Systemwide Audit Support
160
40
40
40
40
Computer Support
200
50
50
50
50
Quality Assurance
210
90
0
120
0
Total Audit Support Hours
710
190
100
300
120
0
Total Audit Support Percent
5--10%
7.95%
7.33%
4.74%
14.74%
5.47%
-
Total Direct Hours
7,535
2099
1809
1735
1892
0
Total Direct Percent
85%
84.39%
80.98%
85.77%
85.26%
86.30%
-
Total Net Available Hours
8,928
2592
2109
2035
2192
0
Total Net Available Percent
100%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
Schedule 1,2 - Cross Check
Total Year Hours
1st Quarter
9/30/2001
2nd Quarter
12/31/2001
3rd Quarter
3/31/2002
4th Quarter
6/30/2002
Lab 9/30/02
Total net available hours (From Sch 1)
8928.00
2592.00
2109.00
2035.00
2192.00
0.00
Total net available hours (From Sch 2)
8928.00
2592.00
2109.00
2035.00
2192.00
0.00
Total A+AS+IN (Scd 3 Check)
6825
1909
1709
1435
1772
0
Actual FTEs, End of Period (Check down)
4.60
4.60
4.60
4.60
4.60
0.00
Avail. Hours, Other Res., Subtotal (Check Down)
5
2
0
5
2
0
0
0
0
0
Gross Available Hours
10088
2912
2429
2355
2392
0
Net Available Hours
8928
2592
2109
2035
2192
0
Indirect Hours
1393
493
300
300
300
0
Audit Program
4775
1444
1084
930
1317
0
Audit Support Activities
710
190
100
300
120
0
Investigations Hours
900
200
300
200
200
0
Advisory Services
1150
265
325
305
255
0
Total Direct Hours
7535
2099
1809
1735
1892
0
Net Available Hours
8928
2592
2109
2035
2192
0
UCSC Sched 1 thru 4.xls
Page 1
10/24/2001
UNIVERSITY OF CALIFORNIA
INTERNAL AUDIT PLAN DETAIL
SCHEDULE 3
FY 2002
UC-Santa Cruz
High Risk*
Planned
Primary
Additional
Project
Name/Title of Audit
1, 2, 3
Hours
Index Code Index Code(s) Number
Planned Carry Forward
Housing, Dining, and Childcare Services
1
210 A.a.04
A.c.01
01-02
Student Fees, Receivables, Admissions
Registrar Service Center
1
200 H.f.06
01-07
Network Security
1
200 G.b.01
01-05
Subtotal Planned Carry Forward
610
Planned New Audits
Arts Division Service Center and Shakespeare
Santa Cruz
1
250 H.c.01
02-01
Chancellors Business Office and Administrative
Funds
1
250 E.c.01
B.a.01
02-02
Community Health Service Center and Process
Controls
1
350 H.f.07
02-03
Data Center Operations/ Operating Sys.
Software Controls
1
300 G.b.04
G.b.05
02-04
Disclosure Statements/ Federal Reports
1
250 E.k.01
E.k.02
02-05
Emergency Preparedness and Fire Dept.
Controls
1
250 C.a.02
C.b.01
02-06
Library, Media Services, Service Center and
Computing Controls
2
300 A.a.05
02-07
Maintenance Expenses
1
400 D.d.02
D.a.02
02-08
Natural Sciences Business Office and Marine
Sciences Financial Controls
1
350 H.d.04
H.c.15
Hd.o3
Ei.o5
02-09
OPERS/ Athletics
2
350 A.a.01
H.f.04
02-10
Parking Accounting and Recharge Rate
1
300 A.a.07
02-11
Payroll Processing and Time Reporting
1
350 E.g.01
E.g.04
02-12
Subtotal Planned New Audits
3,700
Subtotal Planned Supplemental Audits
(lump sum only)
465
Total Planned Audit Program
(1)
4,775
Planned Advisory Services
AIS Systems Development Team
2
200 G.b.01
Conflict of Interest Coordination
160
External Audit Coordination
60
Space Inventory for Capital Planning
3
200 D.a.01
MBEST Financial Statements
3
200 H.d.05
Whistleblower Policy Implementation
80
Policy and Procedures Review
80
other as requested
170
Subtotal Planned Advisory Services
1,150
*1 = Top 10 scores
2 = Next top 10 scores
3 = All others
Schedule 3 FY 2002 Plan
FUNCTIONAL AREAS
CATEGORY
HOURS
PERCENT
Auxiliary, Business, & Employee Support Services
A
1,160
24%
Development & External Relations
B
-
0%
Environmental and Public Safety
C
250
5%
Facilities, Construction & Maintenance
D
600
12%
Financial Management
E
850
17%
Human Resources & Benefits
F
-
0%
Information Technology & Communications
G
700
14%
Campus Research Departments & Instruction
H
1,350
27%
Healthsciences, Research, Instruction & Clinical Services
I
-
0%
Lab Research Programs & Processes
J
-
0%
UCOP
K
-
0%
4,910
100%
See attached Chart
FY 2001-02 Annual Plan - Functional Areas
UC-Santa Cruz
G
Information Technology &
Communications
14%
A
Auxiliary, Business, &
Employee Support Services
24%
C
Environmental and Public
Safety
5%
D
Facilities, Construction &
Maintenance
12%
E
Financial Management
17%
H
Campus Research
Departments & Instruction
28%
UNIVERSITY OF CALIFORNIA
SCHEDULE 4
INTERNAL AUDIT PLAN STATISTICS
FY 2002
UC-Santa Cruz
Annual
I
Coverage of High Risk
Hours
Number
Hours
Number
Hours
Number
Goal
In Planned:
Includes carryover high risk
Top 10 High Risk (if not 10 insert correct #)
15
0
15
Audits
3660
15
3660
15
Advisory Services
0
0
0
0
Total
3660
15
0
3660
15
Percentage
100%
#DIV/0!
100%
80--100%
Coverage of CORE
Annual
II
Hours
Number
Hours
Number
Hours
Number
Goal
Number of Core elements in Universe
17
17
In Planned:
Audits ( 02-04/2,1-05/2,02-12,01-07)
6
Advisory Services (AIS)
1
Total
0
7
0
0
0
7
Percentage
41%
#DIV/0!
41%
Approx. 33%
III
Distribution of Tier 1 Audit Coverage
Hours
Percent
Hours
Percent
Hours
Percent
A
Auxiliary, Business, & Employee Support Services
510
14%
#DIV/0!
510
14%
B
Development & External Relations
0%
#DIV/0!
0
0%
C
Environmental Safety and Security
250
7%
#DIV/0!
250
7%
D
Facilities, Construction & Maintenance
400
11%
#DIV/0!
400
11%
E
Financial Management
850
23%
#DIV/0!
850
23%
F
Human Resources & Benefits
0%
#DIV/0!
0
0%
G
Information & Communications
500
14%
#DIV/0!
500
14%
H
Campus Research Departments & Instruction
1150
31%
#DIV/0!
1150
31%
I
Health Sciences Research, Instruction & Clinical Services
0%
#DIV/0!
0
0%
J
Lab Research Programs & Processes
0%
#DIV/0!
0
0%
K
Office of the President
0%
#DIV/0!
0
0%
Total
3660
100.00%
0
#DIV/0!
3660
100.00%
Camp/Lab/OP
Health Sciences
Combined Total
Camp/Lab/OP
Health Sciences
Combined Total
Camp/Lab/OP
Health Sciences
Combined Total
Schedule 4 FY 2002 Plan
Page 1