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Tuesday, April 25, 2006

Site Visits seem to target Internal Connections

The BearingPoint site visit report for April 2006 is available online at:
The numbers in the report are troubling.

When the Extended Outreach Site Visits were started, the SLD claimed that site visits would be assigned by plucking invoices at random from the stream of invoices being processed. That does not seem to be the case. The preponderance of site visits connected to Internal Connections invoices indicates that the SLD is targeting those FRNs.

By my calculations, over 50% of the Site Visits to date were for Internal Connections. Meanwhile, less than 25% of FRNs for 2005 were for Internal Connections (and that includes unfunded FRNs), and less than 14% of approved 2004 FRNs were for Internal Connections. So Internal Connections FRNs are somewhere between 2 and 4 times as likely to be selected for a Site Visit.

I am in complete agreement with focusing audit resources on Internal Connections (despite BearingPoint and SLD protestations to the contrary, the Site Visits are audits). However, I am not in agreement with telling participants that site visits are selected randomly when they are not.

Of course, we can't know how site visits are assigned: that information is part of "internal controls," the secret set of rules by which the SLD operates.

There are some variations in the numbers of site visits by entity type (libraries got off easy, schools had it hard) and by state, but those variations don't look statistically significant to me.

Don't know much about the site visits? For more information on audits of all types, see my article in this month's School Business Affairs magazine.

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