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Monday, April 15, 2019
Senate: OHA Must Complete Audit of LLCs
By News Release @ 2:22 PM :: 2540 Views :: Ethics, OHA

SENATE RESOLUTION REQUESTING THE OFFICE OF HAWAIIAN AFFAIRS TO COMPLETE THE 2017 INDEPENDENT FINANCIAL AUDIT AND MANAGEMENT REVIEW OF THE OFFICE OF HAWAIIAN AFFAIRS AND ITS SUBSIDIARIES.

SR151: Approved by Vote of State Senate April 12, 2019

WHEREAS, independent audits are used to assess an organization's financial and management performance and to hold agencies accountable for their mission implementation, program management, and expenditures of public funds; and

WHEREAS, the purpose of independent audits of public agencies is to help eliminate waste and inefficiency in government and to ensure that public funds are expended effectively; and

WHEREAS, in February of 2017, the Office of Hawaiian Affairs Board of Trustees voted to authorize the Office's Chief Procurement Officer to issue a request for qualifications for an independent certified public accounting firm to conduct a financial audit and management review of the Office of Hawaiian Affairs and its subsidiaries; and

WHEREAS, the Board's vote was in response to concerns that there was no systematic review of the Office of Hawaiian Affairs' procurement processes, limited liability companies, or loans; and

WHEREAS, in the Office of the Auditor's Report No. 18‑03, Audit of the Office of Hawaiian Affairs, the Auditor raises concerns regarding spending irregularities and possible breaches of the Office's fiduciary duties that involve some of the same concerns raised by the Board of Trustees, including alternate funding processes for limited liability companies created by the Office of Hawaiian Affairs, that the financial audit and management review were meant to assess; and

WHEREAS, Auditor's Report No. 18-03 also notes that while the Auditor was gathering information, reviewing documents, and preparing its report, the Office of Hawaiian Affairs took proactive steps to implement changes, including approving the procurement of an external auditor to examine the Office of Hawaiian Affairs' financial condition and that of its limited liability companies in March 2017 and approving a policy amendment that limits the Chief Executive Officer's budget adjustment discretion; and

WHEREAS, this body believes that the recent steps taken by the Office of Hawaiian Affairs, while encouraging, must be completed in order to effect meaningful change; and

WHEREAS, the financial audit and management review would be an invaluable tool for the Board of Trustees to identify areas of waste and inefficiency and enable the Board to tailor policy changes, strengthen the Board's fiduciary oversight, and improve mission implementation; now, therefore,

BE IT RESOLVED by the Senate of the Thirtieth Legislature of the State of Hawaii, Regular Session of 2019, that the Office of Hawaiian Affairs is requested to complete the 2017 independent financial audit and management review of the Office of Hawaiian Affairs and its subsidiaries; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Chairperson of the Board of Trustees of the Office of Hawaiian Affairs, Chief Executive Officer of the Office of Hawaiian Affairs, and State Auditor.

SR151: Text, Status 

Related: Secret Timeline Shows OHA Lying to Legislature While Stonewalling LLC Audit

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