According to Professor Wheat in "The Activist Auditor: A New Player in State and Local Politics" (Public Administration Review, September/October 1991, Vol. 51, No. 5) our impact and our approach to our work entitles us to wear the badge of the "activist auditor". I willingly embrace those concepts and even credit our success to activist auditing. Rather than being known as activist auditors, I believe we are more effective if our unit is primarily perceived by program managers and department heads in Cincinnati as a resource in their quest for performance improvement.

As Audit Manager, I report to the City Manager. His bosses are the nine members of City Council who serve simultaneous two-year terms. With the exception of three departments reporting to independent boards (Health, Parks, Recreation) all city agencies report to the City Manager. The city is also responsible by contract for management and operation of both a computer center and a sewer district serving the entire metropolitan area.

A five-member Operational Audit Advisory Committee is comprised of two citizen members and three members of City Council. As the name suggests their role is advisory only. This arrangement has been in place since the legislative authorization for the Internal Audit function in 1982.

This structure has some risks in that City Council properly holds the City Manager responsible for the performance of his subordinates. In fact, in most cases it is the City Manager that has the ultimate authority to direct that operational changes occur. However, any criticism of an operating department by the performance auditor can be construed as criticism of the City Manager who is also the auditor's boss. Thus there is no apparent incentive for the City Manager to approve or release a negative performance audit report implying that his administration is ineffective in some way. Logically, save professional integrity, there is no incentive for the performance auditor to prepare a report containing bad news. Similarly, program managers hoping to avoid negative findings and the expected displeasure of their boss, could be reluctant to cooperate with audit or acknowledge any findings. Predictably, past audits were contentious and typically resolved only by involving the City Manager as mediator or arbiter.

When I was appointed audit manager in 1988, my office had become a toothless watchdog by virtue of this system of disincentives. We were hardly the protector of public interest or the advocate of economy and efficiency once envisioned. In rethinking the performance audit program and its role in the City of Cincinnati, we determined the inherent adversarial thrust was not always necessary. Given that the primary purpose of a governmental entity is to maintain or improve the well-being of its citizens, there should be little difference between the goals of the audit organization and the organization being audited. Both seek to achieve program effectiveness; operational efficiency; and compliance with applicable laws, regulations or policies.

Instead of trying to put the teeth back into the audit program legislatively, we determined to grow th back. We thought that we could do a better job if we were viewed as a resource to management rather than an annoyance. We sought to become an integral part of the city's management control system. We began to sell our findings and recommendations as opportunities to deliver city services better, cheaper, or faster. We edited our general audit program and republished it as a "Self-Audit Guide" so that management would know what criteria were applied in developing our annual work plan, what we meant when we referred to management controls, and what to expect from us when we started a performance audit. We provided citywide training in developing and communicating goals, objectives and performance criteria to address common weaknesses identified in previous audits.

At audit entrance conferences we more aggressively solicited management's input on audit objectives and the tests or standards that might be applied. Instead of thrashing out findings in front of the City Manager, we began to resolve them at the lowest management level (the program managers) capable of effecting change. Higher levels of management (department directors) would be involved only as necessary when agreement could not be reached or to reflect concurrence with the resultant implementation plan. We also extended the time between the formal exit conference and report publication to allow inclusion of the agency's implementation plan. A summary of the implementation plan is now incorporated in the report's executive summary. This emphasis on the responsiveness of management and the plan for corrective action connotes that the control system is working to identify and fix the city's accountability, compliance, effectiveness, or efficiency problems.

Is it working? We firmly believe so!

In 1987, staff productivity was estimated at .5 significant audit reports annually per full time equivalent auditor. We are now at 1.7 and hope to reach 2.0 in 1993. Agency officials are requesting audit services and our assistance in completing self audits. Instead of "meeting by phone" once per year, the audit committee takes its charge more seriously. It now meets quarterly with the audit manager and city manager.

The emphasis on cooperation does not seem to have impaired our independence or our objectivity. We still find and correct waste, fraud and abuse. Recent reports have pointed out:

n A Fire Chief who dispensed $85 thousand in extra pay to himself and his four assistants for being "on call".

n A Superintendent of Industrial Pretreatment that ignored both state and federal environmental laws in administering his program.

n A senior health official that took no action for two years to correct problems identified by a state spot-check of the restaurant inspection program.

n An official entrusted with $10 million in automotive fleet who had abandoned preventive maintenance and other accepted fleet management practices.

n $2 million in excessive overtime paid to city staff.

n An ineffective employee safety program.

Although we do not measure our performance by the number of personnel changes influenced by audit reports, we believe it is further evidence that we have not compromised our objectivity or professionalism by emphasizing cooperation. More than 20 senior management changes have occurred following our post-1988 audits. At least three of these were dismissals, another dozen were accelerated retirements, and the rest were "reassignments". For two managers, positive audit reports may have been a factor in their subsequent promotions.

I suspect that most performance auditors were attracted to the profession to identify and oust derelict public managers; detect and correct waste, fraud, and abuse; and generally right wrongs. As a practical matter most public managers want to be considered as doing a good job. Many, in fact, do remarkable work, others need a little (to a lot of) help, and some just need to be prodded. Fortunately, the public managers that violate the pubic trust are few. As a consequence, performance auditors provide value when they demonstrate a good manager's success, act as consultants to managers needing help, or strengthen a control so that a manager can be held accountable.

It is in this context that the activist audit concepts espoused by Professor Wheat are most relevant.

Proactive and Holistic Unless there is a market for widgets it does the widget manufacturer little good to become more efficient at producing them. Similarly, if housing code compliance is a problem in certain areas of your city, more aggressive code inspection is not the answer. However, the inspection program might be more effective if housing inspectors know of and make referrals to social programs for tenant education, low and moderate income home ownership, rental rehabilitation loan subsidies or guarantees.

Go Beyond Scope/Mandate It is important to have a time budget, work plan, and specific objectives for every audit. Without these, audit projects can literally continue indefinitely. It is just as important that work plans be flexible enough to extend testing or change objectives when necessary and appropriate. No matter how good your planning you will always find something you did not expect that will warrant additional attention. Some new findings will have such broad implications that you will want to define a separate audit project to pursue them.

Self Initiate Audits In Cincinnati we use a vulnerability assessment to establish our annual work program which is then reviewed with the city manager and audit committee. During the course of the year we may be redirected by council or the city manager to emergent issues. We feel that audit should be responsive but not whipsawed.

Trends, Surveys, Special Reports Audit organizations should concentrate on audit work. However, we have found it very cost effective to pursue some objectives such as overtime pay, sick leave and employee safety on a citywide basis. Similarly, we have long advocated SEA type reporting and use various trends in developing our annual work plan. A particularly useful audit technique is for us to compare the approaches of multiple agencies performing like responsibilities such as construction, fleet management, and cost accounting. We have learned to be careful with reports of any kind that identify problems unless we simultaneously present viable solutions.

Government Audit Standards Cincinnati's audit work has been criticized by those who did not like the findings as "bureaucratic blob", "all wet", and "goofy". But because we follow Government Audit Standards, anything that we report is supported by the best evidence available. We have eventually prevailed over every one of our critics. We now enjoy tremendous credibility with elected officials, management and the media.

Public or Elected Representative is Ultimate Client The public should be served by everything the audit organization does. Remember that your interface with the public or their elected representatives is through your published reports and the media. Write reports that inform and will be read and quoted. Avoid trivial issues. Use graphics, an executive summary, an implementation plan, and a table of contents. Edit carefully for typos and clarity. Enlist the media by cooperating with them. Explain your press policy up front and follow it.

Conclusion

Sure, it is your responsibility to ferret out fraud, waste and abuse. But it is also your job to help good managers do a better job and to improve the quality of policy decisions by elected officials.

Be an activist auditor but don't tell anyone.