Florida Board of Governors

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Florida Board of Governors

The Value of an Effective Compliance Program

November 3, 2010

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Value of an Effective Compliance Program

Why Measure Compliance? Increased Scrutiny on Boards and Governance

Effort

Proliferation of Laws and Regulations

Increased Fines/Penalties for Noncompliance

Increasing Complex Environments/New Threats

Measuring Success

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Value of an Effective Compliance Program

Audits by Third PartiesSurvey of Board EffectivenessExternal Quality Assessments of Compliance

Program – Institute of Internal AuditorsDevelop and maintain a quality assurance and

improvement programPeriodic assessments, ongoing monitoring,

and compliance assurance

Measuring Success

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Value of an Effective Compliance Program

Value Proposition

Robust Compliance Program = Internal Controls to ensure Compliance with laws and regulations

Promotes efficient and collaborative compliance activities

Minimizes instances of noncomplianceReduced fines/penalties if instances of

noncompliance are detectedEarly identification of systemic compliance issuesEnterprise view of compliance

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Establishing a Framework for Identifying Adverse

Trends

Develop Summary of Lessons Learned and Risk Issues

Develop A Dashboard of Early Indicators Identify and report high risk areas, audit trends

and University financial trends to the Board of Governors

Recommendations that allow management to benchmark and monitor and mitigate shared risks - system wide

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Trend Analysis – Example

0

2

4

6

8

10

12

14

16

18

FAMU FAU FGCU FIU FSU NCF UCF UF UNF USF UWF

Number of Material Findings

Findings by State University

Schedule of Expenditures of Federal Awards

Student Financial Aid Cluster

Research & Development Center

Special Education - Grants for Infants & Families with Disabilities

Temporary Assistance for Needy Families

Totals

#1 #2 #3 #4 #5 #6 #7 #8 #9 #10 #11

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Trend Analysis - Example A133 Audit Issues

Findings By State Universities in Florida

(Source AG A133 Audit for 6/30/xx "Index of Findings by State Universities and Community Colleges." )

University Finding Type 1 2 3 4 5 6 7 8 9 0 11 Totals

Schedule of Expenditures of Federal Awards 1 1 1 1 1 5 7%

Student Financial Aid Cluster 12 2 4 6 1 1 4 1 6 1 3 41 59%

Research & Development Center 4 1 2 1 4 5 2 1 20 29%Special Education - Grants for Infants & Families with Disabilities 1 1 2 3%

Temporary Assistance for Needy Families 1 1 1%

Totals17 4 4 9 2 1 8 8 6 6 4 69 100%

25% 6% 6% 13% 3% 1% 12% 12% 9% 9% 6% 100%

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Value of an Effective Compliance Program

Managing Risk Before It Manages YouProvide reasonable assurance that potentially

significant risks have been identifiedStrategic level objectives linked to controlsKey decisions are being made with the evaluation

of risk/reward tradeoffsRisks are managed on an aggregate basisIndividual universities across the system are

managing risks in the same manner

The Next Level: Enterprise Risk Management

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Thank You!

Thank You!

Contact Information

Thomas M. King CPAVice President – Florida Market Leader(904) [email protected]