Agenda 06/26/2018 Item #5A06/26/2018
COLLIER COUNTY
Board of County Commissioners
Item Number: 5.A
Item Summary: Presentation of the County Manager’s Corporate Compliance and Internal
Control Program. (Michael Nieman, Corporate Compliance and Internal Review Manager)
Meeting Date: 06/26/2018
Prepared by:
Title: Executive Secretary to County Manager – County Manager's Office
Name: MaryJo Brock
06/18/2018 4:59 PM
Submitted by:
Title: County Manager – County Manager's Office
Name: Leo E. Ochs
06/18/2018 4:59 PM
Approved By:
Review:
County Manager's Office Leo E. Ochs County Manager Review Completed 06/19/2018 10:12 AM
Board of County Commissioners MaryJo Brock Meeting Pending 06/26/2018 9:00 AM
5.A
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Corporate Compliance and Internal
Control Program
June 26, 2018
Collier County, Florida
Collier County GovernmentCounty Manager ’s Office
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Packet Pg. 18 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
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•Ethics and Anti-fraud
•Advise County staff on ethics questions
•Educate County staff on the relevant agency policies and
regulations involving ethics and anti-fraud
•Conduct internal investigations and disciplinary hearings
•Internal Control Program
•Implement and manage the internal control program
•Create process improvements and best practices throughout
the County
Compliance Program
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Packet Pg. 19 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Who is Responsible for Internal Controls?
“Management is responsible for establishing and maintaining the control environment.
Auditors play a role in a system of internal controls by performing evaluations and making recommendations for improved controls.
Furthermore, every employee plays a role in either strengthening or we akening the Institution’s internal control system.
Therefore, all employees need to be aware of the concept and purpose of internal controls.”
Va nderbilt University, Office of Risk Advisory Services
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Packet Pg. 20 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Why Internal Control?
•CS/HB 11 (2018)
•Narrowly defeated in Tallahassee
•Wi ll mandate local governments, state attorneys, courts
and other governmental units establish a system of
internal controls
•Streamline operations to create efficiency, reduce
duplication, and thereby save taxpayer money
•Promote transparency, productivity, and accountability
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Packet Pg. 21 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
“A udits do not relieve County management of their responsibilities. It is the
responsibility of County management to understand and implement proper
procedural controls in order to reduce and limit the risk of fraud, error, and
misappropriation of County assets. Internal Audit may recommend improvements in
audit reports, but ultimately it is the duty and decision of County management to
formulate processes and controls to ensure compliance with Federal Regulations,
Florida Statutes, County Ordinance, and County Policies.”
Collier County Clerk of Courts, Internal Audit Department, Audit Report 2017-5
(2017)
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Packet Pg. 22 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Who is Responsible For Internal
Controls?
“Management is responsible for establishing and maintaining the control environment. Auditors play a role in a system of internal controls by performing evaluations and making recommendations for improved controls. Furthermore, every employee plays a role in either strengthening or weakening the Institution’s internal control system. Therefore, all employees need to be aware of the concept and purpose of internal controls.” Vanderbilt University, Office of Risk Advisory Services.
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Packet Pg. 23 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Internal Controls –Myths & Facts
Myth Fact
“Internal Controls are a waste of time and
unnecessary”
-Internals Controls create efficiencies by streamlining
processes and procedures to maximize staff
productivity
“Internal Controls add more work to my already busy
schedule”
-Internal Controls formalizes and simplifies standard
operating procedures and processes
“Why do we need Internal Controls, we already have
an Internal Audit Department”
-Internal Controls assist senior management in
providing reasonable assurance, not absolute
assurance that the organization’s objectives will be
achieved.
-Department and Division personnel are the owners
of Internal Controls
“Internal Controls are essentially negative, like a list of
‘thou shalt nots’”
-Internal Controls provide the framework for staff to
complete tasks correctly the first time
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Packet Pg. 24 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
“If you can’t describe what you are doing as a process, you don’t know what you are doing.”
Dr. W. Edwards Deming
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Packet Pg. 25 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Leo E. Ochs Jr.
County Manager
Michael Nieman
Compliance Counsel
Larry Tracz, CPA, CFE,
FCPA
Senior Internal Controls
Manager
Michael Stark, MBA
Internal Controls
Manager
Sahar Dajani-Jones, MS,
PMP, LSS BB
Internal Controls
Analyst
Rose Burke, CPA,
CGMA, MBA
Internal Controls
Manager
Darren Hutton
Internal Controls
Analyst
Nancy Zikmanis, MBA,
PMP, CHMM
Internal Controls
Manager
Roger Stack
Internal Controls
Analyst
Internal Control
Organizational
Chart
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Packet Pg. 26 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Vi sion
Facilitate seamless and high-quality Internal Control services toward
achieving objectives in operations, reporting, and compliance today
and into the future.
Establish, implement, and manage a system of Internal Controls based
on the Committee of Sponsoring Organizations (COSO) Internal
Control Framework (Green Book) to provide reasonable assurance that
the Agency will achieve its objectives and mission.
Mission
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Packet Pg. 27 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
What is Internal Control?
Internal Control is the integration of
activities, plans, attitudes, policies, and
efforts of the people of an organization
wo rking together to provide reasonable
assurance that the Agency will achieve
its objectives and mission.
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Packet Pg. 28 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Most recognized and authoritative Internal Control Framework
•Committee of Sponsoring Organizations (COSO) is comprised of:
•AICPA -American Institute of CPA’s
•IIA –Institute of Internal Auditors
•AAA -American Accounting Association
•FEI –Financial Executives International
•IMA –Association of Accountants and Financial Professionals
•ACFE –Association of Certified Fraud Examiners
Aligned with the Federal Government’s United States Code 3512 c and d
Title 31.
Committee of Sponsoring Organizations (COSO)
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Packet Pg. 29 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
COSO Integrated Framework Cube
•Operations –Effectiveness and efficiency of operations
•Reporting –Reliability of reporting (Internal and External)
•Compliance –Adherence with applicable laws and regulations
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Packet Pg. 30 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
•Complete Internal Control COSO Implementation
•1,800 Control Certifications on an Annual Basis
•123 Process Improvements to Date
•Quarterly Division Reviews
•Three Year COSO Recertification Cycle
•Enhancing the Fraud Risk Assessment
•Creation of Agency Best Practices
Office of Internal Control Strategic Plan
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Packet Pg. 31 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Administrative
Services
Bureau of
Emergency
Services
Emergency
Medical Services
Communication
and Customer
Relations
Fleet
Management
Human
Resources
Information
Technology
Procurement
Services
Risk
Management
COSO Certification
Public Utilities
Facilities
Management
Utilities Finance
Engineering and
Project
Management
Solid &
Hazardous
Waste
In-Ground
Services
Water
Treatment &
Distribution
Growth
Management
Building Plan
and Inspection
Capital Project
Planning
Code
Enforcement
Development
Review
Operations &
Regulatory
Mgmt.
Operations
Support
Road
Maintenance
Transportation
Engineering
Zoning
•13 Divisions
Completed
•9 Divisions
In-Process
•10 Divisions
Remaining
Public Services
Domestic
Animal Services
Health Division
Community &
Human Services
Library
Museum
Operations &
Veterans
Services
Parks and
Recreation
University
Extension
Services
Public Transit &
Neighborhood
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Packet Pg. 32 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
1,800
Control
Ta sks on
Annual
Basis
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Packet Pg. 33 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
Administr ativ e S er vices Department 27
Growth Management Department 21
Public Services Department 16
Public Utilities Department 59
Total P rocess Improvements 123
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Packet Pg. 34 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
•Standardized Inspection Forms and Checklists
•Pa rks & Recreation, EMS, & Fleet Management
•Contract Development & Oversight
•Procurement Services, Risk Management, & Information Te chnology
•Inventory Reconciliation & Revenue Va riance Analysis
•Operations Support
•Project Hand-off (Design à CEI)
•Tr ansportation Engineering
•Recycle Material Revenue Process
•Standardizing SOP Review and Communication
•Utilities Finance Operations, Solid Waste, Water, and Wastewater
Process Improvements
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Packet Pg. 35 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
•Certification Status
•Timeliness
•Quality of Documentation
•Process Improvements
•Remediation Actions
•Control Frequency
•Control Enhancement based on risk, technology,
business needs, and changes in the operations
Quarterly Reviews with Division
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Packet Pg. 36 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
•Pa yroll
•Contract Administration Oversight
•Purchase Requisition
•P-Card
•Cash Handling
•Tr aining and Development
•Inspections
•Invoice Approval
Agency Best Practices
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Packet Pg. 37 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s
•Process Improvement
•Ongoing Internal Control Monitoring
•Enhanced Fraud Mitigation Management
Next Steps
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Packet Pg. 38 Attachment: Internal Controls Presentation - 6-18-18a (6000 : Presentation of the County Manager’s