OSAE sets the PACE: Premier Auditing Consulting and Evaluations! American Recovery and Reinvestment Act (ARRA) Readiness Review

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Topics What is ARRA? OSAE Readiness Review Findings Other issues Recent developments What you can do now Group discussion: Risks, challenges and recommendations Online resources

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! What is ARRA? Public Law authorized $787 billion in expenditures. Signed in to law February 17, 2009 Purpose: Preserve and create jobs Assist those most impacted by the recession Invest in science and health-care technology Invest in infrastructure Stabilize state and local government budgets

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! What is ARRA? Approximately $48 billion allocated to California* Billions Health & Human Services15.4 Education11.8 Labor8.5 Transportation4 Science & Technology1.9 Energy1.3 Other1.1 Housing0.9 Water & Environment0.7 Public Safety0.4 * Source: Recovery.ca.gov

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! OSAE Readiness Review Reviewed 6 departments that have received ARRA funding. Criteria developed from OMB guidance M dated 3 April Core readiness areas included: –Oversight and Fraud Prevention –Grants Management and Accountability –Reporting Requirements –Transparency

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Findings Departments need to self-assess their risks on an ongoing basis and implement corrective action on prior audit findings. Departments need to identify high risk sub- recipients (grantees) and provide them with additional training and increase monitoring. Contracts/grant agreements need ARRA specific language.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Findings  Development statewide standards for the form and content of reporting ARRA information on departmental websites is needed.  Development of a statewide plan to coordinate and communicate data collection efforts among the various ARRA funded departments is needed.  Coordination between federal, state and local auditors is needed to minimize overlap.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Other issues Lack of federal oversight agency guidance on contract/grant agreement language, reporting requirements, and performance measures (e.g. jobs created) Lack of funding for administrative and audit costs.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Recent developments OMB A-133 Single Audit Requirements –Changes proposed to increase accountability of ARRA funds. Audit and administrative costs –Proposed bill would provide funding for audit and administrative costs. Gov. Schwarzenegger appointed Laura Chick as the State Inspector General to oversee ARRA funding and ensure accountability is maintained.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! What you can do now Clear prior audit findings Conduct a departmental risk assessment focused on ARRA funding. Document findings and corrective action taken. Conduct a risk assessment of sub-recipients. Encourage sub-recipients to clear their prior audit findings and conduct their own self assessment of ARRA related risks. Provide additional training and increase monitoring of high risk sub-recipients.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! What you can do now Develop contract/grant agreement language. Coordinate with other departments that have overlapping responsibilities. Establish a departmental task force and meet regularly. Read OMB guidance and GAO reports related to ARRA. Obtain clear written guidance from your federal oversight agency on your role and responsibilities. Focus on preventive controls.

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Group Discussion: What risks have you identified? What new controls are you implementing? What challenges will your department need to overcome? Have you found any useful resources that other departments could use? What recommendations would you make to other departments that are receiving ARRA funding?

OSAE sets the PACE: Premier Auditing Consulting and Evaluations! Online resources