To Whom it may Concern:
SANDAG’s Office of the Independent Performance Auditor (OIPA) began the Salaries and Compensation Performance and Compliance audit in April 2020. The authority to complete the audit was provided by the Board of Director’s and Audit Committee’s Approved Audit Plan. In addition, the OIPA was directed by the full Board of Directors to complete the audit by August 2020. The OIPA informed to the Board of Directors that the timeline was attainable based on the OIPA’s time budget.
In accordance with Assembly Bill 805, SANDAG’s Board Policy 039, and as a professional Certified Public Accountant (CPA) and SANDAG’s Independent Performance Auditor (IPA) that audit was conducted in accordance with Generally Accepted Government Auditing Standards (GAGAS). As required by GAGAS, the audit process followed by the OIPA included inquiring with SANDAG’s management and staff to gain an understanding, requesting sufficient, corroborating supporting documentation or documenting a lack there of, and performing analysis. At the completion the aforementioned steps, and taking into account other relative factors, the OIPA uses the work performed to develop a confidential Draft Audit Report.
Once a Draft Audit Report is completed, the OIPA meets with the Executive Director and Management in a formal Audit Exit Conference to provide the Draft Audit Report and discuss the findings and recommendations within the report. The OIPA informs management that the Draft Audit Report is subject to the deliberative process and may be revised based on additional supporting documentation and information provided. The OIPA then provides management with sufficient time to review the Draft Audit Report, provide additional supporting documentation, seek further understanding from the auditors, and provide a written response (Management’s Response). In this case management was given 11 business days. After the auditors receive the Management’s Response, and any additional documentation, the auditors review the response and additional documentation (if provided) and determines if the draft report requires any revisions. This also is in accordance with GAGAS and Board Policy 039. After, the report is issued final with or without revisions.
Also, in accordance with GAGAS and Board Policy 039, if there are material findings, impairment, hindrances or interference with Management or the Audit Committee, the Auditor is required to report it to the governing board. In this case, the governing board, is the SANDAG Board of Directors.
An auditor’s confidential draft report is not obtainable by a CPRA because it is the work product of the auditor’s and until the auditor receives Management’s Response and additional documentation (if any), the report may be revised. The draft document, if provided to the public, may contain information that could be unclear, misunderstood, or incomplete, which is why it is not CPRA obtainable.
OIPA, after reviewing Management’s Response and additional documentation provided, considered these items and revised the draft. The report was then issued final and provided to the Board of Directors on August 26th.
The Final Auditor’s Report on Salaries and Compensation Compliance and Performance Audit and the Management’s Response that stands alone as required by GAGAS, has not been provided to the Public as required under AB805 and Board Policy 039. The documents posted to the SANDAG website was not docketed by the OIPA Committee Liaison, which is standard practice at SANDAG. Further, the 406 pages that have been documented is not OIPA’s final report or work product as Management has manipulated, deleted and redacted information that in parts are OIPA’s work product, but no longer stand alone or is structurally within the guidelines of GAGAS.
The documents posted to the SANDAG website include the following:
1. A revised Management’s Response that is addressed to the Independent Performance Auditor, dated September 2, 2020, after the draft and final report issue dates, and was not provided to OIPA.
2. The Auditor’s work product that is, as marked a confidential draft that should not be shared and has been manipulated and redacted (redaction include dates, dollar amounts, and official titles, that are not confidential).
3. Layers of other documents that have not been provided or reviewed by OIPA.
4. An attorney-client privileged document that provides after-the- fact attorney opinions that lack any basis or evidence and are conflicting to the evidence that was previously provided by SANDAG to OIPA.
5. Numerous pages of previous board meetings, a letter from the previous Board of Director Chair that was recently drafted as more after-the-fact documentation.
6. Other information that has not been previously provide to OIPA.
7. The OIPA Final Report issued to the Board of Directors on August 26, 2020 that has been defaced, manipulated, redacted, and with many parts deleted completely, by Management.
OIPA would like to point out that this incomplete and manipulated inclusion of portions of OIPA’s final report is not OIPA’s work product. It should also be noted and concerning that the report provided, has been redacted for dollar amounts, position titles, dates, and percentages that are not confidential in nature. Further, Management’s Response that was provided to OIPA has been fully deleted as well as other parts of the report. Making the report completely inaccurate and confusing to the public. I have made several requests that the posting be removed or that the OIPA’s official report be posted as a separate agenda item and Management’s 406 pages be included as a separate item and to follow protocol. My requests have been ignored.
In fact, during a executive team meeting, held with SANDAG’s Executive Director and Leadership Team, both senior leadership and the Executive Director stated that they were directed by the Chair of the Audit Committee to docket the documents provided, acknowledging that the documents provided was not a normal practice.
Therefore, having been unsuccessful at all attempts to work with Management and follow both internal reporting to the public procedures that were approved by the Audit Committee, AB805 and Board Policy 39, I as the Independent Performance Auditor am officially releasing the full and complete Final Report that was issued to the SANDAG Board of Directors and the Audit Committee on August 26, 2020.
Mary Khoshmashrab, MSBA, CPA
Independent Performance Auditor
San Diego Association of Governments
401 B Street, Suite 800 San Diego, CA 92101