Auditors are those wonderful people you wait anxiously to see every year, and when they appear it’s just like Christmas morning. Okay, maybe it isn’t exactly that way. You may look at audits as a necessary evil, but they really do serve an important role for your organization.
Here at LAGERS, we have lots of audits. Lots. We have an internal auditor (me), and we have multiple external audits as well. In addition to our regular external financial audit (which many, if not all, LAGERS employers also have), our auditors are now performing an additional audit of internal controls over member data and employer financial data. This is called a Service Organization Control Report, or SOC Report. This additional review is due to a recent pronouncement by the Governmental Accounting Standards Board (GASB). Then for the first time in many years, Missouri’s State Auditor conducted a performance audit of LAGERS and issued a report in August 2015.
Why are we telling you this? Not so you’ll feel sorry for us, really. The fact is that while an audit can be a bit intrusive, it really can be an important part of the oversight of your organization. At LAGERS we are fiduciaries for the trust fund on behalf of all participants, and our ultimate duty is to maintain that trust for the exclusive benefit of members and beneficiaries. As a public entity, we want to be transparent to all stakeholders, including the taxpayers, that help fund the benefits provided. Having independent audits of our finances and operations can help us provide assurance to all parties that we take this responsibility very seriously and are accomplishing our mission. Internal audit reports directly to the Audit and Finance Committee of the Board of Trustees in order to maintain this crucial independence and objectivity. You may have heard us say “LAGERS is getting it right,” and the results of the multiple audits mentioned support that statement.
Generally speaking, auditors aren’t always “skunks at the garden party,” but they can and will be if necessary. Depending on the type of audit though, it shouldn’t be only about finding problems, but hopefully offering ideas for ways to improve. Someone who doesn’t do your job every day but who can objectively observe may be in a good position to offer suggestions. I like to think of the goal as “better,” and auditors can be just the people to help make that happen.
To view the most recent available external financial audit, visit our website. The SOC Report mentioned above will be available when complete (fall 2015) to all LAGERS employers on the Employer Web Portal of ECLIPSE.