69-16 Internal Controls Ordinance

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Figure 1. Internal Control: A Brief Timeline controls was clear; the challenge, however, was the introduction and implementation of new controls in a small but very busy office, in which most employees were unfamiliar with , control concepts. =z Training began at monthly staff meetings, with internal control topics introduced in small segments. Initially, training focused on the defi- nition of internal control as stated in the Uniform Internal Control Standards for Indiana Political Subdivisions, a docu- ment prepared by the SBOA following adoption of the 2015 state law. The SBOA's standards emphasize the role — that employees play in controls: "Ultimately, it is the people at every level of the orga- nization that are instrumental in ensuring the success of the internal control process. Accordingly, internal controls integrate the attitudes and actions of people within the orga- nization into the processes .112 The county auditor's office emphasized that even though management has profound responsibilities in internal control, staff involvement is crucial. By emphasizing that internal control is not a set of rigid rules but a process that needs a buy -in from staff to make it work, employees were given owner- ship of this impor- tant endeavor. It makes little sense for management to adopt policies that staff find unwork- able. Employees need to know that their input is valu- able and that for controls to be effec- tive, "we are all in this together." Early training efforts in the county - - - auditor's office also introduced staff to key developments in the regulatory history of controls, as illustrated in Figure 1. Staff discussions explored the accounting scandals that led to the Sarbanes -Oxley Act and the internal control audit requirements that resulted. By tying events that had national significance to their It makes little sense for management to adopt policies that staff find unworkable. Employees need to know that their input is valuable and that for controls to be effective. we are all in this together! daily workplace, the local auditor staff gained a deeper understanding of the need for, and benefits of, internal control. Employees were also introduced to the GAO's "Green Book;' including the GAO's efforts to make the federal standards appli- cable to state and local governments .3 While internal control concepts were presented to the auditor staff in a concise, summary manner, the topic wasn't dumbed down, either. Employees were treated as profes- sionals who were expected to help make a significant contribution toward the effective and efficient operation of their office. Implementation Challenges Getting employees to understand what internal control is, -and what it isn't, is one matter. Actually imple- menting controls is another. To intro- duce the five control - components, employees in-the- county- and -itor office learned -about the- control cube, as pictured in Figure -2, which gives a visual representation of how the components interrelate with each other, with the entity's orga- nizational structure, and with the reporting, compliance and opera- tions objectives. Discussion topics included an analysis of how most of us implement controls in our daily 22 JOURNAL OF GOVERNMENT FINANCIAL MANAGEMENT FALL 2016