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 Table of Contents
 Introduction
 Operations
 Audits and other planned revie...
 Summary of reports issued
 Management advisory services
 Investigations
 Follow-up
 Other activities
 Office charter
 Staff development
 Budget and expense analysis
 Time analysis






Group Title: University of Florida Office of Audit and Compliance Review annual report
Title: University of Florida Office of Audit and Compliance Review Annual Report
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Permanent Link: http://ufdc.ufl.edu/UF00072255/00001
 Material Information
Title: University of Florida Office of Audit and Compliance Review Annual Report
Series Title: University of Florida Office of Audit and Compliance Review Annual Report. 2002-2003.
Physical Description: Serial
Language: English
Creator: University of Florida Office of Audit and Compliance Review
Affiliation: University of Florida -- College of Liberal Arts and Sciences
Publisher: University of Florida
Publication Date: 2003
 Subjects
Subject: University of Florida.   ( lcsh )
Spatial Coverage: North America -- United States of America -- Florida
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Bibliographic ID: UF00072255
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: George A. Smathers Libraries, University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida

Table of Contents
    Table of Contents
        Page 1
    Introduction
        Page 2 (MULTIPLE)
    Operations
        Page 2 (MULTIPLE)
    Audits and other planned reviews
        Page 6
    Summary of reports issued
        Page 7
        Page 8
        Page 9
        Page 10
    Management advisory services
        Page 11
    Investigations
        Page 12
    Follow-up
        Page 13
    Other activities
        Page 14
        Page 15
    Office charter
        Page 16
    Staff development
        Page 3
    Budget and expense analysis
        Page 4
    Time analysis
        Page 5
Full Text



























CONTENTS


Introduction ................................. .....2
Operations ................................. ......2

ttaffing alnd ther Resources
Organization Chart
StaffAttributes
Staff Development
Budget and Expense Analyisis
tTime Arnalysis
Audits and Other
Planned Reviews ....................... ........................... h

Trend Analysis
Client Surveys
Summary of Reports Issued .............................7
Management Advisory
Oervices .. .............. ........................................ 11
ERP-Business Reengineering
Special Advisory Reviews
Control Delf-Assessment

nvestigationsd Expense Analsis................................ ...12
A ummary of Significant Issues
Follow-Upanned Reviews ............................ .................. 13
Follow-Up Statistics
SumOther Activities ............................................... 14
Office C harter..................... ....... ..................... .. 16









Annual Report 2002-2003
Annual Report 2002-2003












INTRODUCTION

The Office of Audit and Compliance Review
(OACR) provides a central point for the
coordination of and responsibility for activities that
promote accountability, integrity, and efficiency for
the University of Florida.

In response to changes in applicability of Section
20.055, Florida Statutes (Inspector General's Act),
President Young and the Board of Trustees Audit
Committee approved the Internal Audit Charter in
December 2002. The Charter defines OACR
mission, organizational structure, scope and
authority. It also establishes the professional
standards for the staff and specifies the duties and
responsibilities of the office. The complete Charter
can be found at the end of this report.

To more accurately reflect the mission, the office
name was changed from Inspector General to Audit Staffing and Other Resources
and Compliance Review effective July 1, 2003. At
that time, a new web site, htt ://oacr.ufl.edu was also During most of the 2002-2003 period, OACR was
launched. fully staffed. Staffing grew from nine to twelve
positions with a senior auditor and a staff auditor
recruited using the salary funding for the staff
OPE RATIONS position temporarily assigned to the Enterprise
Resource Planning project. An additional senior
auditor position was also established.
Goals and Objectives Staff Attributes

The department goals and objectives for the 2002- The quality of internal audit service is highly
2003 fiscal year were incorporated in the annual eeet o sffin. Te c arisn of
dependent on staffing. The comparison of staff
work plan. During this period, goals and objectives tt te n e cation, eperience, an certif
wer fuy or s, a, attributes in education, experience, and certification
compares very favorably with those reported by

The devolution from state legacy systems to the peer universities.
PeopleSoft Enterprise Resource Planning System
epeSft Enterprise Resurce anning System We have revised the organizational structure where
(ERP), or UF Bridges, has been an office focus this
year as one full-time employee has been working groups of audos are ee a ed th se
with the implementation team during the initial gou a t
phase. Other staff members have participated in Al OACR professional staff have at least one
committees planning the transition and all audit certiication ont g e n
staff members have attended PeopleSoft training relevant conferences and seminars is romote
relevant conferences and seminars is promoted.
organized by OACR. During 2002-2003, training expenses and training
Section 1011.4105, Florida Statutes, requires that hours per employee increased by more than 100%,
university inspectors general certify transition plans primarily due to the commitment to PeopleSoft
and assess key controls for implemented systems training. Two professional staff members also
and business processes. To that end, the majority of pursued graduate studies in complementary
audit resources will be committed to this endeavor disciplines. Table 1 reflects a listing of staff
during the next two years. participation in formal training programs.




2 Annual Report












INTRODUCTION

The Office of Audit and Compliance Review
(OACR) provides a central point for the
coordination of and responsibility for activities that
promote accountability, integrity, and efficiency for
the University of Florida.

In response to changes in applicability of Section
20.055, Florida Statutes (Inspector General's Act),
President Young and the Board of Trustees Audit
Committee approved the Internal Audit Charter in
December 2002. The Charter defines OACR
mission, organizational structure, scope and
authority. It also establishes the professional
standards for the staff and specifies the duties and
responsibilities of the office. The complete Charter
can be found at the end of this report.

To more accurately reflect the mission, the office
name was changed from Inspector General to Audit Staffing and Other Resources
and Compliance Review effective July 1, 2003. At
that time, a new web site, htt ://oacr.ufl.edu was also During most of the 2002-2003 period, OACR was
launched. fully staffed. Staffing grew from nine to twelve
positions with a senior auditor and a staff auditor
recruited using the salary funding for the staff
OPE RATIONS position temporarily assigned to the Enterprise
Resource Planning project. An additional senior
auditor position was also established.
Goals and Objectives Staff Attributes

The department goals and objectives for the 2002- The quality of internal audit service is highly
2003 fiscal year were incorporated in the annual eeet o sffin. Te c arisn of
dependent on staffing. The comparison of staff
work plan. During this period, goals and objectives tt te n e cation, eperience, an certif
wer fuy or s, a, attributes in education, experience, and certification
compares very favorably with those reported by

The devolution from state legacy systems to the peer universities.
PeopleSoft Enterprise Resource Planning System
epeSft Enterprise Resurce anning System We have revised the organizational structure where
(ERP), or UF Bridges, has been an office focus this
year as one full-time employee has been working groups of audos are ee a ed th se
with the implementation team during the initial gou a t
phase. Other staff members have participated in Al OACR professional staff have at least one
committees planning the transition and all audit certiication ont g e n
staff members have attended PeopleSoft training relevant conferences and seminars is romote
relevant conferences and seminars is promoted.
organized by OACR. During 2002-2003, training expenses and training
Section 1011.4105, Florida Statutes, requires that hours per employee increased by more than 100%,
university inspectors general certify transition plans primarily due to the commitment to PeopleSoft
and assess key controls for implemented systems training. Two professional staff members also
and business processes. To that end, the majority of pursued graduate studies in complementary
audit resources will be committed to this endeavor disciplines. Table 1 reflects a listing of staff
during the next two years. participation in formal training programs.




2 Annual Report












AUDITS AND OTHER

PLANNED REVIEWS



Trend Analysis

Table 4 reflects a three-year analysis of projects
planned and completed. The work plan includes
planned audits and advisory reviews.

Over the last three years, 51 of 52 projects planned
were completed. The 98% completion rate reflects
this year's extraordinary effort.

During 2002-2003, 45% of available time, or 7,746
hours, was spent on audits. Internal audits were
planned based on evaluation of risk and included
input from university management.




Table 4-Trend Analysis of Projects Planned/Completed




2000-2001 19 19 16 2 18
2001-2002 19 17 13 3 16
2002-2003 16 16 14 3 17

'Table 6 lists reports issued this period.





Client Surveys
(17 Responses)

Audit
Client Surveys Audit
Performance
Client surveys completed at the conclusion of
each engagement reflect that OACR services are
well received. Ninety-five percent of survey Audit Report
responses indicated ratings of either good or
excellent in all categories, an improvement from
last year's 88%.
Audit Team


0% 10% 20% 30% 40% 50% 60% 70%
Excellent U Good
OFair 0 Poor



6 Annual Report












SUMMARY OF REPORTS
efficiently, effectively and met program objectives.
ISSUED Motor Pool offers routine automotive repairs,
maintenance services and 24-hour refueling to
university, state agencies and other affiliated units.
The summary of reports profiles major Motor Pool is entirely self-funded. In 2002,
engagements completed during this fiscal year. The revenues and expenditures were $1,001,000.
subjects of the reports illustrate commitment to
proactive and meaningful coverage through audits We found Motor Pool operations to be efficient and
in areas of new implementation such as, GatorLink; effective. Motor Pool pricing was competitive with
technological trends, such as Technology Licensing; external vendors and provided value to the
regulatory scrutiny, such as IFAS Sponsored university units. Management committed to
Programs. Audits of other critical functions of the establish performance measures to benchmark and
University such as motor pool, web-based grade document achievements. Procedures to obtain
processing and retirement plans were also billing authorization and update contact
conducted during the period. information will be improved. Formal competitive
procedures will be used for the procurement of
Office of Technology Licensing (OTL) outsourced services. Fuel pumps will be inspected
nivsit in io w annually and employees will be instructed about
University-developed inventions were
appropriate time card endorsement.
appropriately and effectively evaluated for transfer appropriate ime card endorsemen
to the commercial sector through patent and Grade-a-Gator
licensing. The licensing was administered in
compliance with the Bayh-Dole Act. Overall, OTL An audit of the web-based grade processing
fulfilled its responsibilities for the technology application, Grade-a-Gator, was performed to
transfer process from evaluation of disclosures determine if it had appropriate controls to ensure
through the licensing of inventions. accuracy, completeness, and confidentiality of
grades processed.
Management agreed to address concerns related to grades processed.
documentation of decisions made in the invention Controls were in place to ensure the confidentiality,
disclosure evaluation. Procedures to evaluate accuracy and completeness of data during grade
marketability, processing of patent attorney fees, processing. Management will reiterate the
and monitoring license agreement deliverables will University's expectation that grade accuracy and
be improved as well. integrity are the responsibility of the course
instructor. Grade-a-Gator use guidelines will be
Restricted Gifts updated, a mechanism for grade verification will be
At the request of the University of Florida provided and detection controls for grader identity
Foundation, Inc., we audited five endowed funds and status will be developed.
with disbursements of $358,441 to determine Center for Performing Arts
whether fund use by the University was in
accordance with donor intent. The University Center for Performing Arts (UFPA)
operates the Curtis M. Phillips Center for the
We determined that funds used by University units Performing Arts, the Baughman Meditation Center
were in compliance with donor restridions. and the University Auditorium, for a combined
Management agreed to develop financial need 2,600 seating capacity. The objective of the audit
evaluation for graduate students and to enhance was to assess the adequacy of internal controls in
monitoring for specific funds. place for event accounting, revenues and
colledions, purchases and disbursements, and for
Motor Pool & Vehicle Utilization the accuracy of financial information compiled and
reported.
The primary objective of the audit was to determine
whether Motor Pool operations were conduded



2002-2003 7











Levin College of Law

Policies and practices with regard to teaching loads,
assignments and leave were included in the scope
of this audit. We also evaluated purchasing card,
property and international program administration.

We found strong procedures with respect to
property and purchasing card administration.
Faculty assignments and teaching loads were
generally consistent with College policies and
norms. We identified opportunities for
improvement in the coordination and reporting of
sabbaticals and faculty off-campus employment
and in administration of international programs.
Overall, collections, disbursements and contractsistration
were appropriately processed and there was Voyager Gas Card
compliance with restrictions of selected gift
Accounting for revenues and associated costs, This audit was initiated following investigative
timeliness of billings, collections and deposits, and review of card theft and misuse. We evaluated the
working capital levels needed improvement. UFPA Voyager Fleet System (Voyager) gas card program
management committed to develop, document and for adequate procedures, controls and support for
periodically update policies and procedures, Voyager gas card transactions on campus. The
comply with the University's deposit policies, audit addressed opportunities for improvement in
strengthen oversight of events, improve cost policies and procedures and program
allocation of expenses, improve billing processes administration.
and raise working capital levels. Management agreed to evaluate use, needs and
IFAS Sponsored Programs alternatives relative to the current Voyager card
program. Subjec to the conclusion of that process,
Internal controls and compliance over pre- and efforts to develop and disseminate transaction
post-award processes in the IFAS Office of monitoring, program administration, and Voyager
Sponsored Programs (OSP) were within the scope card use policies may be undertaken.
of this audit. OSP provides support to Institute of Ption Initu tu et
Food and Agricultural Sciences faculty and staff in
the preparation and submission of sponsored We completed an audit of fiscal transactions
program proposals and provides oversight and processed through the Preservation Institute:
accountability in the management of awarded Nantucket (PI:N) local checking account. PI:N, an
projects. IFAS awards were $69.5 million in fiscal historic preservation institute within the College of
year 2002. Design, Construcion and Planning, offers a
summer academic program to historic preservation
Controls over the fiscal management and reporting students along with other programs. The Institute
for sponsored programs needed significant is housed on facilities in Nantucket Island,
improvement. Procedural changes initiated by OSP Massachusetts. The checking account was closed
just prior to and during the audit should address a following this audit and opportunities for improved
number of concerns. Management agreed to processes were identified in a variety of areas.
implement processes and/or reinforce newly
established procedures to facilitate proposal and Concession Fund
contract reviews and ensure timely fiscal
management and reporting. We assessed the internal controls in place for
Concession Fund collections and disbursements.
Commissions from vending contracts for beverages,
food, laundry and games are deposited in the



8 Annual Report











Concession Fund. Commissions for fiscal year 2002
totaled $1,195,000. Concession Fund monies are
held in university local funds and used for
discretionary purchases which are generally not
made with state or grant funds. For the six months
ended December 31, 2002 Concession Fund
expenditures totaled $242,000.

Controls over Concession Fund collections and
disbursements were adequate. The budget was
authorized and effectively monitored. Management
will verify commissions due and evaluate the utility
charging method to appropriately reflect power
consumption of vending machines.

Decentralized Gift Collection oversight. Management will properly classify
projects, ensure payments are accurate and
An audit of gift collection procedures for gifts supported, properly authorize change orders,
received by campus units was conducted to assess follow purchasing bid procedures during selection
the internal controls for decentralized gift collection of sub-contractors, and obtain building permits,
and for the propriety of university-related bank inspections and progress reports.
accounts with vicinity banking institutions.
GatorLink
Most campus units could improve procedures to
provide a higher assurance that collections were An audit of GatorLink was conducted to determine
completely accounted for and were physically if it is a secure and reliable authentication system
safeguarded. Management agreed to disseminate for the University's enterprise resource planning
reminders campus-wide of cash control and (ERP) system and other campus computing
collection policies. Management will re-notify activities. GatorLink was developed to create a
vicinity banks of University policy regarding the single user identifier and password for access to
use of its name and tax ID number and the required University Information Resources. GatorLink
authorization for establishing University bank identifiers (IDs) are required for all students, staff,
accounts. and faculty. As of March 15, 2003, there were 87,869
non-expired GatorLink accounts. GatorLink will be
IFAS Minor Construction used as the authentication control for the ERP
system, to be implemented July 1, 2004.
The budgeting, accounting, and oversight processes system, to be implemented July 1, 2004.
associated with IFAS construction projecs with Controls were generally adequate for a secure and
costs of $1 million or less (minor construction) were reliable authentication system for ERP and other
within the scope of this audit. IFAS Facilities computing services with some exceptions.
Planning and Operations manages IFAS minor Opportunities for improvement were identified
construction on-campus and in each of Florida's 67 over password resets, account maintenance, and
counties made up of extension service offices, contingency processing.
research and education centers, partnerships degree
programs, county unit and 4-H camps. As of International Program Contracts
January 2002, IFAS Facilities Planning & Operations
maintained 1,240 buildings. An audit of International Program Contracts was
conducted to evaluate the adequacy of internal
Controls were generally adequate to ensure that control procedures over contracts. Thirteen
projects were properly funded, authorized and colleges supplement their international area studies
completed according to the approved scope of the curricula with international program contracts. As
work. Management reports were accurate and of December 31, 2003, the UF International Center
useful. Opportunities were identified to improve maintained and coordinated 67 exchange program
compliance with policies and construction contracts in over twenty countries, twenty-two



2002-2003 9











study abroad programs in more than fifteen negotiation, event budgeting, and disbursement
countries and 122 general cooperative international policies. We also recommended creating a checklist
agreements in over 40 countries. of minimum requirements for off-campus venues
and creating a work contract for SGP officers.
Authority to sign international contracts needed
clarification and internal controls over contract Florida Veterinary Medicine Faculty
initiation and monitoring needed improvement. Association, Inc.
Management will inform the university community
of policy regarding administrative processing and The specific objective of the review was to
execution of international program contracts. determine the proper classification and accounting
Procedures to formally document the review of program revenues. Florida Veterinary Medicine
process will be established. Management will Faculty Association, Inc. (FVMFA) was created for
continue to monitor exchange contract reciprocal the orderly collection and distribution of faculty
balances, update policies and procedures for practice activities. Prior to the creation of the plan,
oversight of contracts and use of the database, and faculty practice activities and associated hospital
establish guidelines to ensure the timely completion revenues were accounted for in the University of
of the contract initiation process. Florida Health Operations & Maintenance (O&M)
Trust Fund, subject to the budgetary and spending
Retirement Plans & Options oversight exercised by the University and
governing authorities.
Retirement plans were audited to determine if governing authorities.
employees were enrolled timely and appropriately Only 36 percent or $2,323,933 of program revenues
in retirement plans to which they were eligible. As accounted for in the Practice Plan met the plan's
part of this audit, we also evaluated the accuracy definition of practice income. The remainder, or 64
and completeness of retirement records and percent, should have been accounted for under the
compliance with retention policies. O&M trust fund appropriately matching the
expenses that generated these revenues. Changes
Our analysis reflected that adequate controls were will be intitiated to only include physician related
in place to ensure the proper administration of the income in the FVMFA. An analysis of revenue
University's retirement plans and options. codes will be completed to properly identify the
Improvement opportunities existed in monitoring physician fee component of program revenues.
employee voluntary contributions and in record
retention practices.

Student Government Productions

We audited Student Government Productions
(SGP), an agency of the Student Government
executive branch, to evaluate controls over
contracting and disbursement activities. SGP
provides free and reduced price entertainment to
the University community. Student Government
Productions is 86% funded by Activity and Service
Fee allocations generated from tuition fees and 14%
by ticket sales. As of April 2003, SGP received
$581,000 and spent $563,000 for fiscal year 2002-
2003.

Expenditures were reasonable, allowable and
compliant with applicable contract terms. We
found opportunity for improvement in
disbursement controls to minimize over-
commitment of funds. Management agreed to
update or establish procedures for contract



10 Annual Report












MANAGEMENT ADVISORY
SERVICES

financial processes including general ledger,
OACR is committed to providing proactive, accounts receivable, travel and expense, customer
preventive advice on internal controls, operations relations and asset management will be
and compliance. Requests for management implemented. New systems for human resource
advisory services (MAS) usually come from various management, payroll processing, and time and
management levels throughout the university. The labor data collection will also be implemented. The
information provided through these services assists state systems that the University has been using
management in decision making and in improving will no longer be available to state universities and
operations. Results of these types of services are the PeopleSoft systems are scheduled to replace
usually communicated through management them on July 1, 2004. In addition, new student
letters. systems will be implemented in 2006 and 2007.

During fiscal year 2002-2003, 4,226 hours were Other management advisory activities included
spent on MAS. This represented 24% of available participation in Advisory User Council, Stakeholder
hours and is four times the hours spent in fiscal and Team meetings and researching governance
year 2001-2002. The significant increase in hours is requirements and best practices.
attributable to OACR's participation in the
Enterprise Resource Planning (ERP)-Business Sp l Ay
Reeng Special Advisory Reviews
Reengineering Process.
Saiv proid c in i OACR provided proactive assistance on matters of
OACR actively provides consulting assistance, r c ,
training and training tools, and post-audit internal controls, system design changes, and
training and training tools, and post-audit
governance on the following areas:
assistance. The following chart illustrates the type governance on the following areas:
of MAS performed and the percentage of time Application Fees By Credit Card (Office of
spent. Admissions)

Extended Pay Plan Procedures (University Police
Effort Distribution Department)
control self Housing Freshman Online Application (Division of
Consultations Assessment Housing)
9% 6%
Other ERP-Business DOCE Non-Credit Agreement (Department of
18% Reengineering Continued Education)
47%
Intern Participation Certificates (Office of Academic
Speca Affairs)
Advisory
20% Financial Aid Reporting (Office of Academic
Affairs)
ERP-Business Reengineering Employee Time Cards (Center for Instructional
&Research Computing Activities)
The UF Enterprise Resource Planning (ERP) Project, &Research Computing Aivities)
or UF Bridges, is a multi-year effort to improve UF Payroll Cost Transfers (Finance & Accounting)
business processes. PeopleSoft systems will
provide the framework for integrated real-time Fischer Scientific Contract Overcharge (Finance &
information using common tools across a wide Administration)
range of university activities. These systems will
provide web-based, real-time access to work Trade Agreements Policy Review (Stephen C.
processes and information. New systems for O'Connell Center)


2002-2003 11











Unclaimed Property (Finance & Accounting) communicated to management and are monitored
for implementation.
Student Body Law 2002-142 Activity & Service
Funds (Student Government Finance) Twenty-two separate complaints, some containing
multiple allegations, were addressed during the
Control Self Assessment fiscal year.

The university's fiscal and administrative structure In total, 1448 hours, or 8% of available hours were
is based on a decentralized model in which deans, committed to investigative efforts.
directors, and unit heads are responsible for unit
procedures and internal controls. Previously, Significant issues from these reviews are
OACR developed and accumulated the results of a summarized below.
university-wide self-assessment survey of
compliance with university procedures and Inappropriate Internet Content
appropriate internal controls. The survey was
limited to just over 100 questions that addressed A complainant alleged that a vendor was delivering
most business functions and included links to online gambling websites and software from
supporting policies and suggested practices to computers located on the University of Florida
provide unit administrators with an educational campus.
resource on controls as well as a tool to evaluate the
controls within their own environments. OACR has We determined that the specific content was no
kept the Control Self-Assessment Tool available on longer contained on the servers. However, based
our web site as a permanent reference and training on documentation submitted and public discussion
tool for units at http://oacr.ufl.edu. of similar allegations at other universities, we
concluded that the vendor servers on the University
Newsletter campus were used as alleged. Management
decided to terminate the contract.
Quarterly newsletters were distributed campus-
wide with regular features that include highlights Payroll Abuse
from projects and campus-wide issues. Copies are
available at htt://loacr.ufl.edu. An employee had full-time employment with an
affiliated organization and was at the same time a
Post-Audit Assistance part-time employee of the University.

We routinely provide support and guidance on the We determined that the two positions involved
implementation of planned actions. similar job duties. Biweekly, an average of 63 hours
were paid in addition to the 80 hours full-time
INVESTIGATIONS assignment. We concluded that a minimum of 590
hours, representing $8,976, was paid in excess of the
authorized assignment.
The OACR receives complaints and allegations of Gas Credit Card Abuse
fiscal improprieties from a variety of internal and
external sources, induding hotline calls, direct OACR was informed of misuse of a state gasoline
correspondence, and referrals from other university credit card. Between July 26 and August 21, 2002
offices and state agencies. The investigative $6,200 in charges was processed for a state vehicle
reviews conducted by OACR have dual objectives described as remaining on-campus.
of responding to facts of allegations and addressing
relevant fiscal and administrative control Merit was found in the misuse of the gas card in the
weaknesses. amount of $8,908. Procedures and oversight of
credit card use and billing were not timely or
Where appropriate, recommendations for adequate to detect and preclude misuse. The
improvements of internal controls are employee responsible for fueling the vehide
terminated employment from the University and



12 Annual Report












criminal investigation was pursued. An audit was for their implementation. Reports issued by the
initiated to evaluate card use policies and external auditors, including the Office of Auditor
procedures. General and Office of Program Policy and
Government Accountability, contain
Research Income Diversion recommendations for which university management
also provides a corrective implementation plan.
Concerns regarding diversion of research by-
products using university resources by a former Standard 2500, Standardsfor the Professional Practice of
College of Medicine faculty member was Internal Auditing, promulgated by the Institute of
addressed. Internal Auditors, requires that the internal auditor
determine that management has taken appropriate
We determined that revenues generated had been action regarding reported audit comments.
inappropriately deposited to the faculty member's
personal account. The former faculty member Quarterly follow-up procedures were conducted
currently resides outside of the United States and throughout the year and their results were
the case was transferred to the University Police communicated to University management. For the
Department. report period, the OACR staff expended 973 hours,
6% of available hours, to evaluate the implementation
status of 118 action plans, 37 of which required two or

FOLLOW-UP more follow up visits.
Table 5 summarizes the results of our follow-up
activities as of June 30, 2003.
Audit reports include auditor's comments and
planned actions developed and agreed to by the
audit team and management with estimated time



Table 5 Follow-up Activities





Academic Affairs 34 27 6 1 79% 75%

Finance &
.Adm o 45 39 6 0 87% 87%
Administration

Sponsored Research 11 9 2 0 82% 88%

Health Affairs 2 2 0 0 100% 94%

Agricultural and
10 5 4 1 50% 100%
Natural Resources

Student Affairs 10 9 1 0 90% 83%

Development and
6 5 1 0 83% 50%
Alumni Affairs









2002-2003 13











Planned Action
Implementation Percentage
As reflected by the summarized
information, management 7
generally reacted timely and in an
effective manner to implement 6
audit recommendations and A
planned actions.
E4
Oversight by:
7 Student Affairs E 3
6 Agriculture & Natural Resources C
5 Health Affairs 2 8
4 Sponsored Research
3 Development 1 7
2 Finance & Administration
1 Academic Affairs 0 10 20 30 40 50
Number


OTHER ACTIVITIES


Professional Activities University Service

OACR staff participated in various national During 2002-2003, OACR members participated in
initiatives, training and organizations including: various university-wide initiatives and assignments
including:
Board member Association for College
and University Auditors (ACUA) Member ERP General Ledger Committee

Member Institute of Internal Auditors Member ERP Vendor Relations
Committee
Member Association of Healthcare
Internal Auditors Member ERP Vision Team

Member American Institute of Certified Member Information Technology Security
Public Accountants Policy Committee

Member ACUA Information Exchange Member UF Bridges Information
Committee Technology Advisory User Committee

Member IIA North Central Florida Member Auxiliary Review Committee
Chapter Steering Committee
Member Selection Committee for
Treasurer IIA North Central Florida University Controller
Chapter
Member Selection Committee for
Board Member IIA North Central Florida Director for Campus Safety
Chapter
Co-Presenters Research Administration
Proofing Team ACUA magazine, CandU Training
Auditor


14 Annual Report















Table 6-Reports Issued 2002-2003




Office of Technology Licensing 7/1/01-12/31/01 9/30/02 UF-02-361-03 Internal Audit



Motor Pool & Vehicle Utilization As of 6/30/02 12/6/02 UF-03-381-02 Intemal Audit



Center for Performing Arts 7/1/01-6/30/02 1/28/03 UF-02-372-14 Internal Audit



Levin College of Law As of 8/31/02 3/14/03 UF-03-382-03 Internal Audit



Nantucket Preservation Institute As of 6/30/02 4/18/03 UF-03-394-15 Intemal Audit



Decentralized Gift Collection As of 6/30/02 5/16/03 UF-03-380-01 Intemal Audit



Gator Link As of April 2003 6/18/03 UF-02-377-19 Intemal Audit


Florida Veterinary Medicine As of 6/30/02 7/17/03 MAS 72-03-04 Advisory
Practice Plan Review*


Student Govemment
7/1/02-3/31/03 8/8/03 UF-03-395-16 Intemal Audit*
Productions
Substantially completed as of June 30, 2003.

















2002-2003 15


















Audit & Operations Review Committee Members


























Joelen Merkel, Chair Cynthia O'Connell Alfred Warrington, IV











Universy of Florida
Office ofAudit and Compliance Review
Charter



Introducton (b) Condut, asuperi, r oornate other atitS r bs Ctrred out or ftnanced by th
university fo the purp e o pro lng aconomy and effcency In the admlnistraoton
Intenal audlting is an indCepndent, objectie assuriane and consiltig act3iy desiined lo of, prevnttn and detecting fraud an iabuse In, its programs an operatlors.
add value and improv an oranliatonI s opraton. It helps an organizatiFo to acmpOlih its
objectlv by brining a systenatic, dsciplincd approach to evalate and impr~ e the (c) Reelv mplalns coine oI actvlte the UnlVersity as ,equil by the
effectiven f rink magnaement, control, ard govmeranc pfesse. The Offiw of Auit and Whiste-bloweur AIt ~urunt to Setlons 1123187-112.31895, Florda StLutes.
Conpliance l Riew (OACR) at the UniveRty of FoDnd administer the nterial audit program
for the Unlveray ithe te objectve to aslst mmwnbes of the Uniersitv and the Beord of (d) In ar rdal~ei* wl te LfUnslrsiy' s P Mic on Fraudulenl and DIshknest Ats, reaeive
Tmnte in t eff eive dl sharge oa thmer repn5ibllitle. To tMs end the OAACR iurnishes rw Cbleolwer cmpnts do nd mneet h Crieria for an (nea*stigatn under the
whatvle-blowc'$ a onluet, wper,, vr .gun dndte Inqulle
thenm with ainlys, aPPraisals. reonimendations, counsel, and Informnation cncming the Wile-blowers Act and corfut, suervis, or coordnte such Inqul,
a dhltles and gannizatons ravlweed. nmnetga~ains, or nvviews as (prorrate,
Minafon (e) K"p the Uniersity presaibt, management and the audit comltee for the
Unliersi's Boa` d of Trustees nfmmrin oncernkng fraud, abses, irnd Intemal contr
deriancu s relating t progrms iand operati ns, irlate a iretive aactrs, arnd repcrt
The Oflic of Audit and Cmtpliarce Review erves the Universlt of Florid and its support on the progress mde irn imnlemenrin carrecti aaons.
oranizations, IndudIEng it direct %Uport a ganizations and Faculy Practce Plan conaputlions.
It prvndes a cenr'al point for coordilniaut of and overaight frw activltle that promote (f) Ensurs ef ,tti c I denitin and cooperaBion lnteen the Audtor General, fewtral
acount~ality, Inltegrity efclency, and compllance auditorsa and other govermental bodles a1n external audlors with a view toward
avcdlng dupllucion.
Organzafon, Idependence Autrt (9 U) Review, m appmprate, rule and procedures reatin tto e prorams and operatois
of the unlvesity and make recommenratlM cones rmn their Impact.
The unilerity preident appoin tt Chlef Audit Executive. The (ACR operates under the
general supervlsiln al he univerity president and reports t he Presdent for admnnistrative In the peformancet o these rvices, Offle cf AudIt and CmpBance Revlew wll ensure that
support and retrts to the Board o Twrstees thugi Its audit Committee as to Te press an appropi balae is htanet betne auit. nvestlgatve, and other activ1ies.
arnd cnten oml Its rert This reparting relatlnshp promotes indepndenc an aM ures Detall operatlOBnl procedures for th OACR will be establislhe arn prsented for the
sequate ronsideration of audit flrings and planned atons a proval of the prsident and the audit cnmmttee.
In perorming its functdbw, the OACR hws no dirt responsIbtlIty or authoiy eer any of the
aMtites It reviewn Therefe, the audit, revew anid appralsal do not reieve other perons in
the unhersty of the responsiiIlties assigned t thiem. The OACR Is authoried ftll and
unreIcted aIcess t0 all areas and ini ation sourcts inecesry to carry out its actvltes.
Doiuments and Informaton pnvied to OACR 5taff during an engaement are handled In the
same p~det marnr as by those employees nrmally accountable for them. Nur Erenguc, trpar Geeral

Professional Standards

The OACR staff memrbers have a reponbllty to te interest of thos t0hey serve and -hould
refrain "rom enterting nt any artivlty that m ay ceate a cnoflct of Intere Thmey ha- an
bidgaibon of seldisdpline above and beyond Ite nreuirements of law and retulatlos. They wh --
oinfldcntillth CaOsdtent wll thq Inetlute of Intenal Auditor Code Ethlgs. The lnstIuts BOT Audit &L Opeathins Review
5Mda'trd for the Profesna Pt a~tice of Internal Auditng shall mtntitute Ic operang Committee
procedures the Office.

Duties and Responsiblltles
(a) Conduct and cmnate audits, Investlions, and marBaement evles relatib APIOVEO DATE: /i 2
the proprans and operatons f the u tlersity and its sup~pot a.anizatIons.








16 Annual Report













Organization Chart



Chief Audit Executive
Nur S. Erenguc
Coordinator.
Administrative
Services
Suzanne Newman
Director. Auditing &
Management Advisory
Services
Anne E. Burt




IT & IC Consulting
Services sSponsored Research & Auxiliary & Support
Dalymar Berrios Extension Services Services
Jeff Capehart Cheryl J. Bell Kayl S man
Liana Hadjigeorgiou Dwight L. Hulse J V Hite
John "Vito" Hite


Health Center & Academic Mgmt &
Clinical Liaison Affiliated Services
Lori Christiansen Carole S. Silverman






Table 1-Staff Training




PeopleSoft Education 424 12



Association of College and
University Auditors





Association of Inspectors 32 2
General




National Association Student
Financial Aid Administrators




Florida Audit Forum 6 1










2002-2003 3











Time Analysis

Table 2 provides a comparison between time projects. Actual project hours available, including
available as planned and actual time available for 213 hours worked in excess of normal workweek
hours, exceeded 7% of planned available hours.



Table 2-Planned/Actual Hours


Time Available 9 x 2,080 18,720 12x2,080 24,960 (6,240)
Less: Adjustment for Position
Vacancies 3,680 3,680
Training/ Leave Use/ Operational (5,242) 7,100 1,858
Support
Total (10,780)
Excess hours worked 213 (213)






Operating Expenses

19% 32%
Budget

The OACR budget by category is illustrated in
19% Table 3. The highest budgetary commitment is
professional staff salaries representing 92% of
2% 9% 19% total expenditures. The increase in operating

Copying/Supplies a Telephone/Postage expenditures is attributable to travel and
o Dues/Subscriptions o Maintenance recruitment.
Computer Supplies a Travel/Other





Table 3-Analysis of Expenditures

Salaries $610,778 $620,468
Other Personal Services 13,396 7,329
OCO & Other Fixed Assets 4,581 8,741
Operating Expenses 10,947 15,016
Training 12,000 26,318








4 Annual Report













Time Allocation

Chart A represents the planned activity mix for the ERP project. Direct time percentages are
time available for projects and actual effort established as a productivity goal for each
expended. Chart B provides a comparison professional position and for the office as a whole.
between prior year and current allocation of time Direct time excludes administration, service support,
available for projects. In comparison with the leave and training. Chart C compares direct time
prior year, more time was spent on advisory achieved in the last two fiscal years. Total office
services, mostly attributable to our commitment to direct time remained at 67%. Direct service goal was
established at 72%.




Chart A-Allocation of Time Available for Projects Chart B-Allocation of Time Available for Project
Planned vs. Actual Prior vs. Current Year


Training/Leave Training/Leave/
Use/Operational Use/Operational
Support Support

Follow Up Follow Up


Investigations Investigations


MAS
MAS


Audits Audits O
90

0% 10% 20% 30% 40% 50% 0% 10% 20% 30% 40% 50%

U Planned 0 Actual E 2001-2002 0 2002-2003





Chart C-Office Direct Time by Fiscal Years
100%

80%

60%

40%

20%

0%
Quarterl Quarter2 Quarter3 Quarter4 Total Office
FY 01-02 FY 02-03 Goal 72%







2002-2003 5




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