Michael A. Langley

If you are reading the series, Enrollment: Part One – Appellate Court Ruling discussed the Tumulth Family Tribal Appellate Court ruling. This discussion now turns to the 2012 Enrollment Audit. You can find Part One at my blog site http://www.4michael-langley.com if reading this in print and unable to follow the above link.

As many folks know, I worked for our casino for nine years in Corporate Audit Services, informally known as internal audit. The most important item for any audit is the audit scope. Audit scope defines the amount of effort and documents reviewed in an audit. The audit scope ultimately establishes how deeply an audit is performed and how much labor time will be spent. It can range from simple to complete; including all company documents or a small sample.

When this audit was being proposed I had some concerns. It was important to me that a discussion take place between Tribal Council and the members. That discussion should have included what we were planning to do with any and all of the results of the audit. I would have had been even more concerned had I known the limitations in scope. The focus should have been on making our records complete, accurate, and with proper audit trails. Once they were complete and all issues identified, then a discussion with the members could have resulted with appropriate data points including the numbers and amount of people involved.

When it was decided to pursue an audit of our enrollment files a request for bid was placed. Those bids came in and of course they carried a high price tag. The initial bids were for about $300,000. Leadership of that time said the members desired that the files be made complete and accurate. That was the stated goal of the audit. An audit that was to review all the files and compare to our software (Progeny) would of course require many, many labor hours.

Yet, the leaders at that time must have paused at the price tag. Why do I say that? Because ultimately the audit scope was reduced in order to lower the cost. Remember what I wrote above. The audit scope establishes how deeply an audit is performed. The bid request was redone according to a much more limited scope. As a result, the audit procedures would also be limited. Instead of all of the files, only some were reviewed. Instead of being physically on site for the comparison, microfiche copies were reviewed and these were provided by staff. The time the auditor spent on site was very limited. Links between families, such as cousins were not explored for accuracy. The end result of these reductions in scope had the effect of the final winning bid being reduced to about $90,000. That is a very significant adjustment and left much without examination.

The auditors did not identify some very common audit findings. For most audits, it starts with policy and procedures. It surprised me to learn that the lack of a working and in practice policy and procedures for our enrollment department was not identified as part of the audit findings. Typically, auditors test the controls identified in policy and procedure to give some assurance they are operating as designed. For databases, policy and procedures typically include items such as naming conventions, processes for receiving inquiries, tracking of all correspondence and how that looks, database access controls, database change review, and more.

This is not meant to throw shade on the auditors. As with any engagement, there are standardized statements that list the agreed upon procedures and scope. As a nod to my lawyer friends, I acknowledge that audit-ese language is a distant cousin to lawyer-ese language. (We aren’t that bad, but we are related when it comes to setting up the engagement letter). Part of the standard statement is language such as this: Auditor’s do not attest to the agreed upon procedures as being sufficient to identify all errors. In my opinion, the amount of time and resources committed to the audit was woefully inadequate for such an important undertaking that could potentially impact many lives.

Any findings resulting from a limited scope could still be used to make for a better product and still add value through a change to best practices. These findings could also then be applied throughout the process and not just those files identified in the audit. That’s what all auditors hope for in their engagements; a helpful and positive use of information that is timely and relevant to the client. What clients do with the information is actually more important than the information itself.

To keep this short, as a result of a limited scope, even with the corrections identified as needed, there was no way for this 2012 Enrollment Audit to ever make the enrollment records complete and accurate. Disappointingly, some of the issues that were identified were not even addressed. That is the work we have now tasked staff to do. Every file must be able to clearly demonstrate not only the lineage, but that the math for blood quantum is also supported and follows mathematical properties. Any variation must be accompanied with a document explaining why.

There is still very much more work to do. This Tribal Council is committed to those efforts and committed to doing it in a comprehensive and transparent manner no matter the cost and without disenrollment as a goal. Once staff is comfortable with some initial findings they will be reporting to Tribal Council. They are not ready for that yet. After we meet with staff, everything will then be discussed with the members in order to plan how we as a Tribe move forward.