April 1, 2002

COMPTROLLER'S MEMORANDUM NO. 08 (2001-2002)

SUBJECT: ACCOUNTABILITY FOR PUBLIC FUNDS

Section 17.04, Florida Statutes, directs the Comptroller to audit and settle the accounts of officers and those indebted to the State. The Comptroller is to use generally accepted auditing procedures for testing or sampling on a pre-audit and post-audit basis.

A number of post audits have been completed, the results of which give us concern regarding agency cooperation and the monitoring of contracts and grants. Agencies are responsible for ensuring the accountability over state funds and the delivery of goods and services paid for with state funds. In order to accomplish this, agencies must have established appropriate internal controls, which include written policies and procedures, adequate training and monitoring of contractors/grantees. We expect agency staff to cooperate with our audit staff during the performance of audits and to take appropriate and timely corrective action to resolve audit findings.

With regard to specific contract and grant issues, we intend to take the following actions as appropriate:

Hold up of funds-If an audit reveals that an agency does not have sufficient procedures in place to ensure compliance with the provisions of contracts/grants or the audit reveals that appropriate deliverables have not been received, future payments will be withheld until corrective actions have been made.

Offset of funds-In the event an audit reveals that improper payments or overpayments have been made to a contractor/grantee and a continuing relationship exists with the contractor/grantee, overpayments will be offset against future payments.

Recovery of funds-If an audit reveals that an agency cannot document that the State received the deliverables provided in an expired contract or grant, the agency will be required to recover funds paid. If the State has another contract/grant with the entity, procedures will be initiated to stop or reduce payments to the offending contractor/ grantee until the agency has recovered the funds.

In the event an audit reveals the lack of accountability and uncooperativeness on the part of the Agency as a whole, the following actions will be taken:

Letter to agency head-A letter will be issued to the agency head seeking cooperation from agency staff.

Letter to Governor/Cabinet responsible for function/agency-If the agency fails take appropriate actions based on a letter to the agency head, a letter addressing the issues will be sent to the Governor or Governor and Cabinet as appropriate.

Legislative Notification-If the above correspondence does not achieve the desired results, the Legislature will be notified of the problems in order to provide an opportunity to consider necessary Legislative action.

We are willing to work with agencies and provide any assistance needed. We all have the same goal – to provide the citizens of Florida with the most efficient and effective government possible. If you have any questions, please call Bob Spooner at 410-9363 or SUNCOM 210-9363.