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Approaches to Maximize Accountability, Minimize Risks, Improve Transparency, and Reduce Fraud in the Government
Manuel Díaz SaldañaComptroller of Puerto Rico
May 2, 2005
Commonwealth of Puerto RicoOFFICE OF THE COMPTROLLER
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Every entity has to develop different methods or strategies to maximize accountability, minimize risks, improve transparency and reduce fraud. This is even more important when government entities are involved. The administrators or managers in public service assume a fiduciary responsibility in administering the governments’ resources. This fiduciary responsibility entails that the administrator of the goods will hand them over at the end of his tenure with an added value, improved or augmented, in quality and in quantity.
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Programs developed in the Comptroller’s Office to maximize
accountability, minimize risks, improve transparency and
reduce fraud in the Government.
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Mission, Vision and Values
Mission – To oversee the transactions of public funds
and property – To promote the effective and efficient use of
government resources
Vision– To be a world-class model for public office – To serve Puerto Rico as a true agent of
change, integrating the efforts of the public and private sectors
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Cont. Mission, Vision and Values
Values
Commitment We are dedicated to our work .
Integrity We work in a responsible manner.
Sensibility We respect the dignity of all human beings.
Justice We watch for the strictest compliance with the law.
Excellence We are constantly improving ourselves.
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COMMONWEALTH OF PUERTO RICO CONSTITUTION
Article III, Section 221952
The Controller shall audit all the revenues, accounts and expenditures of the Commonwealth, of its agencies and instrumentalities and of its municipalities, in order to determine whether they have been made in accordance with law. He shall render annual reports and any special reports that may be required of him by the Legislative Assembly or by the Governor.
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Total Quality Management
Based on principles of continuous revision of existing processes and constant measurement of the results
– We have identified 230 processes
– We have revised 151 (65 %)
– 715 recommendations have been received and 80% of these recommendations have been complied with
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Cont. Total Quality Management
• First Strategic Plan (1997)
• Third Strategic Plan 2004 to 2007 - composed of five focus areasOverseeingPreventionHuman CapitalTechnologyCustomer Services
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“If you have failed to plan, you are planning to fail.”
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StrategiesDirected towards :
– Each of the focus areas and
– Promoting the objectives or goals of maximizing accountability, minimizing risks, improving transparency in transactions and detecting and preventing or reducing fraud in the Government
Two dimensions:– Internal –External
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Internal Strategies
• Anticorruption Policy (2000)
– Ethic’s Committee - receives, investigates and decides the merits of ethics-related grievances or complaints
– Hot-line
– Internal Audit Advisory Committee (2000)
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Cont. Internal Strategies
• ISO 9000 certification
• Comprehensive Annual Financial Report (beginning on 1997-98)
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Cont. Internal Strategies
• Promoting the use of technology
– Virtual Office
– TeamMate Program in the audit function
– Payroll payments by electronic means, using direct deposits
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“That which isn’t measured can’t be improved.”
Anonymous
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Cont. Internal Strategies
• Project Management Official
– 116 active projects
“The vision must be followed by the venture. It is not enough to stare up the steps – we must step
up the stairs.” Vance Havner
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Cont. Internal Strategies
• Human Capital
– A strict recruitment process
– Continous education requirements
– Reduction of employee turnover
– Assessment of working environment
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External Strategies Identified six strategies geared to improve public administration and fight corruption
1. Rigorous and constant oversight2. Promoting education and training of public
employees3. Promoting an excellent administrative and
financial system with emphasis on effective internal controls
4. Fair laws5. Dissuasive punishments6. Strategic alliances between related agencies
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“Leadership and learning are indispensable to each other.”
John F. Kennedy
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Cont. External Strategies • Promoting education and training of
public employees
– Training of elected public officials on good management practices (Law Num. 222 of August 6, 1999)
– Orientations and training on good management practices
– Expositions in large commercial establishments
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Cont. External Strategies
• Massive disclosure of the role of the Comptroller’s Office
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Cont. External Strategies
“Education must stimulate the development of the capacity to create in human beings and their devotion to spiritual values. Education must also forge citizens with moral integrity
and a will of service to the community. Education must be inspired by a demanding
sense of excellence.”Luis A. Ferré, Former Governor of Puerto Rico
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Cont. External Strategies
“There is nothing
permanent except change.” Heraclitus
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Cont. External Strategies• Oversight function
– Traditional oversight – New oversight methodology
(periodic evaluations) • Property Registers• Internal Audit Offices• Government University• Legislator’s Offices• Municipalities
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COMPARISON OF MUNICIPALITIES (78) COMPLIANCE WITH ESTABLISHED CRITERIAS
FISCAL YEARS 1997-98 AND 2003-04
Source: Special Reports M-99-4A and M-05-4G dated May 25, 1999 and April 14, 2005.
(26%)
(58%)
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MUNICIPALITIES COMPLIANCEPREPARATION OF AUDITED FINANCIAL STATEMENTS WITHIN SIX MONTHS AFTER THE END OF FISCAL YEAR
74
20
10
25
50
75
100
oct. 1997 1997-98 2003-04
(95%)
(26%)
Source: Special Reports M-99-4A y M-05-4G dated May 25, 1999 and April 14, 2005.
Due date extended to Jan. 2005 to comply with GASB 34
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Cont. External Strategies - oversight
• Annual evaluation of financial actions that adversely affect, from an economic point of view, government administration
– Collecting information regarding civil suits
against the government for unlawfully
removing government employees – Our
reports reflect that the loss of economic
resources amounted to $65,066,295 in a ten
year period ending on December 2004.
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Cont. External Strategies
• Actively participated in the approval of laws – In the year 2003-2004 and until March
2005, we have received and submitted comments on 105 drafts of legislative bills
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Cont. External Strategies - lawsCont. Actively participate in the approval of laws
– Continuous education and training of public servants
– Contractual and ethics requirements for those who do business with the government
– Controls and disclosure of governmental transactions
– Oversight and protection of informants (whistle-blowers)
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Cont. External Strategies
• Recommend and promote that all government agencies use technology
– Filing copies of all government contracts and other documents by electronic means
– Use of the Internet to disseminate information of interest
• Complaint register
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“Leaders challenge the status quo. Continuous
challenge produces continuous improvement.”
Paul B. Thornton
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WE COUNT ON YOUR
COOPERATION TO IMPROVE
THE OVERSIGHT FUNCTION
AND ADMINISTRATION OF
PUBLIC FUNDS AND
PROPERTY