State of Hawai’i Audits OHA!

by Trustee Keli’i Akina PhD, Ka Wai Ola October, 2017

As an elected Trustee of the Office of Hawaiian Affairs, I have pledged to work for greater transparency within OHA and accountability to the public. I want to urge OHA beneficiaries and citizens of Hawai‘i to be on alert for the upcoming release of a report from the Hawai‘i State Office of the Auditor. The state performance audit of OHA will contain important information for all stakeholders who care about the effectiveness of the organization.

With so much talk of audits nowadays, I want to share exactly what the state audit aims to accomplish. I also want to share how it differs from the independent audit initiated by the OHA Trustees and crafted by the Audit Advisory Committee, which I led as chairperson.

What is the purpose of the state performance audit?

The state performance audit, conducted at least once every four years, is designed to examine the effectiveness of programs or the efficiency of agencies, or both. This year, the state Auditor has decided to focus generally on grants and spending.

What should we look for in the state performance audit?

The first thing worth examining will be how OHA has improved since the last state audit in 2013. The Auditor found in 2013 that inadequate monitoring failed to ensure that grants were achieving their intended results, and issued recommendations for OHA’s Transitional Assistance Program to implement. The upcoming state audit will assess OHA’s efforts to implement those 2013 recommendations.

A second thing to look for is how well OHA has strengthened its own internal policies and followed external government regulations in spending and managing the finances with which it is entrusted. It will be important to see what the forthcoming report says about OHA Administration and Trustee spending practices.

A third item to note will be what OHA has to say in response to the state Auditor, who has already informed OHA of its preliminary findings. OHA’s response will be published as part of the performance audit report.  Keen observers will want to know how OHA evaluates and plans to deal with any concerns the forthcoming report may raise.

What will the state performance audit NOT tell us?

While the state performance audit will be a valuable tool, it is limited in at least two ways.  First, the state auditor is limited by time and resources, and will focus only on selected areas of OHA operations. Secondly, the state audit will not specifically search for fraud, waste and abuse, although it may uncover some irregularities which OHA, the public, or other government agencies might choose to pursue further.

What this means is that the state audit cannot be the basis of issuing an overall “clean bill of health” for OHA. That leads us to our final question.

How does the independent audit differ from the state performance audit?

The upcoming independent audit has the opportunity to go further than the state performance audit. It will look at every OHA contract in excess of $100,000 over the last five years and a sample of smaller contracts.  This could cover the full range of OHA operations, including its LLCs.  Furthermore, the independent audit will specifically look for fraud, waste and abuse.

Currently, the independent audit is in the final stages of the procurement process designed to attract the best qualified firm from a national field.

Once published, the state performance audit will be available for review at auditor.hawaii.gov.

Trustee Akina welcomes questions, comments and opportunities to engage with the community. Contact him at (808) 594-1976 or TrusteeAkina@oha.org.

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