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5 <br />2023-2024 San Mateo County Civil Grand Jury <br />The Civil Grand Jury found examples of fraud and waste in government listed in the appendix. <br />Each of these examples likely reflects a failure of internal controls to prevent or detect fraud and <br />waste. In other words, you ordinarily can’t have a problem with fraud and waste without a failure <br />in internal controls. <br />Focus on the Control Environment, Information and Communication and Monitoring <br />principles <br />The Civil Grand Jury focused on the control environment, information and communication and <br />monitoring principles of internal control, seeking information about: <br />● Control Environment Principle - how governing boards oversee internal controls, <br />such as a review of management’s report on its assessment of internal controls. <br />● Information and Communication Principle - how management reports to the <br />governing board regarding its assessment of internal control and how <br />management’s assessment of internal controls is communicated to the public, <br />such as through an agenda item in a public meeting of the governing board. <br />● Monitoring Principle - information about how management monitors its internal <br />control systems, such as management's assessment of internal controls. <br />It is of note that this investigation did not evaluate the quality of any entity’s internal control or <br />the effectiveness of an entity’s internal controls. <br />The Civil Grand Jury sent a survey, received responses and confirmed survey responses via <br />interviews with the 28 entities from whom it requests responses. However, common sense <br />suggests each of the recommendations included in this report apply to all entities in the County. <br />The Civil Grand Jury recognizes that for a variety of reasons, management may not want to <br />publicly report its controls and results of investigations. For example, an internal report might <br />include details of needs for improving controls that might be considered a roadmap for fraud <br />until the improvements are in place. Management reports available to the public through public <br />release or materials for a public meeting could exclude such details, while the report available to <br />the public could include an appropriate summary of information from an assessment. <br />METHODOLOGY <br />Preliminary Research <br />The Civil Grand Jury reviewed the websites of San Mateo County public entities and public <br />media related to fraud and waste in government. <br />Preliminary Interview <br />To better understand, as a baseline, how the County Controller’s Office oversees its internal <br />controls, the Civil Grand Jury interviewed the Controller’s Office of the County of San Mateo. <br />6.C. - Page 9 of 22 <br />88