Friday, January 9, 2009

Message from State Auditor Les Merritt - Final Day in Office

Distributed via e-mail today

Dear Friends,

Today is my last day as your State Auditor. It has been a privilege and an honor to serve as The Taxpayers' Watchdog for the past four years, and I believe our team has made a positive difference for the people of North Carolina.

During the past four years, we accomplished a number of important things:

▪ Reduced a backlog of investigative audits -- some more than three years old -- by 76%.

▪ Took steps to ensure that state-funded non-profits, which spend hundreds of millions of your tax dollars, file the required reports disclosing how they spend your money. When I took office, nearly 1,000 of those non-profits had failed to file the required reports. We took action, and within a few months nearly 90% of that group had filed the required reports.

▪ In an effort to be pro-active and prevent problems from developing in the first place, we launched a new initiative to educate personnel from funding agencies and grant recipients on key issues related to compliance and transparency. Our staff has now trained in excess of 10,000 personnel from funding agencies and grant recipients.

▪ We shortened the processing time for non-profit reports from five months in 2005 to approximately three days in 2007.

▪ We exposed 27,000 invalid Social Security numbers being used in six separate state entities.

▪ In another effort to be pro-active, we developed a "strategic auditing" process to help identify unusual trends and potential problems in state spending. The strategic auditing process uses existing hardware, software and skills in the Information System Auditing Division to analyze millions of state transactions -- far more than normally are checked during a regular agency audit.

▪ In another effort to be pro-active, we launched a new initiative in January 2008 to follow up with previously audited agencies to ensure that they are actually making the needed changes identified in earlier audits.

▪ We conducted approximately 50% more performance audits during 2005-2008 than were released during 2001-2004. This increased emphasis on performance audits comes in spite of the fact that in 2005 numerous performance audit staffers were shifted to help clean up the backlog of investigative audits.

Our staff has worked hard to transform the Office of the State Auditor into a more pro-active agency that works to prevent problems rather than simply cleaning them up after the fact, and I am proud of our efforts.

In closing, please join me in congratulating Beth Wood on her election as our next State Auditor. I wish Beth well, and I hope she will continue to make the Office of the State Auditor a more pro-active agency and that she will aggressively hold politicians in both parties accountable for how they spend our tax dollars.

Thank you again for the privilege of serving as State Auditor for the past four years. It has been an honor.


Leslie W. Merritt, CPA
State Auditor of North Carolina

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