# Presentation: 536291

## Government Accountability in Times of Crisis

**Government Accountability in Times of Crisis**

**Federal Financial Management Conference, March 10, 2006**

## Risks, Opportunities, and Challenges

**Risks, Opportunities, and Challenges**

- Recent hurricanes have presented an unprecedented need for government assistance
- Significant amounts of taxpayer funds will be used to assist victims and begin a long and costly reconstruction effort
- Coordination among all levels of government will be critical
- Government auditors’ skills and experience can help provide accountability and control over the relief effort

## Issue 1:  Leadership 

**Five Key Issues Related to Accountability in Times of Crisis**

- Issue 1:  Leadership
- Issue 2:  Preparation and strategy
- Issue 3:  Forensic auditing
- Issue 4:  Auditing standards
- Issue 5:  Lessons learned

## Panel Members

**Panel Members**

- The Honorable Richard Skinner, Inspector General, Department of Homeland Security
- Thomas Gimble, Acting Inspector General, Department of Defense
- Greg Kutz, Managing Director, Forensic Audits and Special Investigations, Government Accountability Office
- Jeff Steinhoff, Managing Director, Financial Management and Assurance, Government Accountability Office

## Issue 1: Leadership

**Issue 1: Leadership**

- “The federal government, our sister states, private citizens and companies are overwhelming us with their help.  And that’s crucial because it will take a joint effort, a magnificent collaboration to rebuild.”
- Haley Barbour, Governor of Mississippi

## Issue 1: Leadership

**Issue 1: Leadership**

- As of mid-December 2005, the Inspector General community had assigned 578 staff (418 full time and 160 part time) to the effort. The staff includes auditors, investigators, managers, and others.
- Of the 19 federal agencies, DOD OIG has assigned the most staff--a total of 153 staff.
- The task of coordinating these efforts is the responsibility of the Department of Homeland Security OIG’s Gulf Coast Hurricane Recovery Office.

## Leadership Questions

**Leadership Questions**

- How was a structure for collaboration developed for the IG community?
- How are the competing interests of 19 OIGs managed?
- “The key to being a good manager is keeping the people who hate me away from those who are still undecided.” – Casey Stengel
- How has DOD managed its large effort?
- What kind of coordination is there with state and local governments?

## Issue 2: Preparationand Strategy

**Issue 2: Preparation****and Strategy**

- “Though still in the midst of conducting their traditional audit products, auditors proactively support hurricane recovery managers to help them manage resources and to avoid the obvious and unexpected pitfalls of what may become the largest disaster recovery initiative in American history.”
- PCIE/ECIE Oversight of Gulf Coast Hurricane Recovery, A 90-day Report to Congress, Dec. 30, 2005

## Preparation and Strategy Questions

**Preparation and Strategy Questions**

- Was the audit community ready to help provide accountability for this crisis?
- How was a strategy and methodology developed to tackle this enormous task?
- How was the work prioritized?
- How are resources being leveraged?
- How has the role of the auditor changed to deal with this disaster?

## Issue 3: Forensic Auditing

**Issue 3: Forensic Auditing**

- "There is no kind of dishonesty into which otherwise good people more easily and frequently fall than that of defrauding the government.”Benjamin Franklin
- “We have absolutely no tolerance for fraud – not against FEMA, not against the American taxpayer, our voluntary partners and certainly not against the victims of this disaster."Acting FEMA Director R. David Paulison

## Forensic Auditing Questions

**Forensic Auditing Questions**

- What kinds of problems have forensic auditors uncovered?

## Slide 12

## Forensic Auditing Questions

**Forensic Auditing Questions**

- What kinds of problems have forensic auditors uncovered?
- How are the auditors working with the Department of Justice?
- What sorts of techniques have been most useful to forensic auditors?
- Has the more proactive role of auditors in reviewing contracts up-front helped to stem abuses?

## Issue 4: Auditing Standards

**Issue 4: Auditing Standards**

- There will be situations in which an entity’s records and supporting documentation are lost or destroyed or in which audit documentation has been lost or destroyed prior to completion of the audit.
- Professional judgment is needed to determine how to proceed.
- The Comptroller General has issued temporary exemptions and guidance.

## Auditing Standards Questions

**Auditing Standards Questions**

- What prompted GAO’s actions to address auditing standards in this situation?
- What situations do the temporary exemptions and guidance cover?
- What are the options in the area of peer review?

## Issue 5: Lessons Learned

**Issue 5: Lessons Learned**

- “No question we should have done a better job on Katrina, and no question that the pictures coming out of New Orleans...   affected our conscience...I mean, people were wondering, in this great country of ours, how come we couldn’t have responded better, and that’s why we’re taking a look at lessons learned so it won’t happen again.”  President George W. Bush, *CBS News’ Face the Nation*, Jan. 29, 2006

## Lessons Learned Questions

**Lessons Learned Questions**

- Is the audit community now in a better position to deal with these types of crises?
- What has worked and what hasn’t?
- How can the lessons learned be applied to other areas?
- What are the key bodies of work in this area going forward?