Custodial System Case Study
As the new Commissioner of the New York City Department of Education you will charged in changing the structure of this organization. Therefore, address the following issues within DOE.
1) As Commissioner how will you change the organization culture that creates fraud, waste abuse and corruption? (According to the Article). Why were the procedures in place created FWA&C opportunities?
To begin with these procedures in place created FWAC opportunities (according to the article) because the custodian system had no oversight. The custodians or superintendents manipulated and controlled the entire budget for buildings’ maintenance and all the employees, which later on turned into big fraud such as bribery, extortion, theft, and nepotism. According to Lydia Segal’s article there was no accountability present at custodian system where custodians employed relatives, friends, and lovers for no-show jobs by giving them a lot of overtime and thousands of dollars. Segal stated that in 1993 …show more content…
the state wanted to create some type of oversight and passed the law that custodians must be accountable to the principal, but this system did not work. As a result, the custodian system lacked oversight by giving the opportunity for malfeasance.
As a commissioner to change this fraudulent organizational culture I would create a reporting system by making an extra position and hire an Inspector General (IG) to oversight custodian system. Also, this reporting system would include the semiannual reports of the performance and budgetary statements of cash flow.
2) As Commissioner how will you plan and/or make procedures to ensure the public, students, parents of other workers within the DOE that fraud, waste, abuse and corruption will not occur or be mitigated according to the article?
According to the article by Lydia Segal the internal controls for custodians was principal; however, principals oversight was worthless because principals were frightened of custodians because custodians could always turn off the heat and hot water, or if there were any events at school they would lock the auditorium and bathrooms. According to Segal, custodian system is also known as indirect system that granted custodians no supervision. Therefore, as a commissioner to prevent FWAC within the DOE, I would set up internal controls that would oversight the organization. By doing so, there first must be established the accountability techniques such as compliance accountability – which is to ensure conformity with the carefully written rules and regulations; performance accountability – which centers on the desired outcomes, such as to prevent abuse and have an impact before something happens; and capacity based accountability – which involves the creation of organizational competence through people, systems, and structures. Moreover, according to Segal’s article there are thousands of dollars involved in the custodian system; therefore, I would create a separation of duties or responsibilities because there must be a sufficient separation of duties and responsibilities among workers who execute accounting procedures or control activities and those who handle the assets. This would create the check and balances which would be one of the roles of the employees to even oversight each other. In addition, I would make a reconciliation of bank accounts and management review to create an insight into the differences between agency’s assets equilibrium per the balance sheet and per the bank statement and the accurateness of the recorded data.
3) As Commissioner how will you measure performance within the custodial system?
Identify what were the problems with performance and what would be your solutions to this issue?
The problems with performance, within the custodian system were the nonfeasance. As Segal stated in the article that the custodians’ central purpose is to maintain a clean, safe learning environment but it was the opposite. Also there was nobody to measure the performance but principal. As a commissioner to measure performance within the custodial system I would hire an IG to execute the performance audit – to evaluate if the organization does what has to be done; and financial audit – to insure if custodians spent the money on what they were supposed to spend it. My solution for preventing the problems with performance is to have internal controls that oversight the procedures of this culture by establishing a bureaucracy where an annual audit must be performed and compliance review if
necessary.
1) As Commissioner how will you change the organization culture that creates fraud, waste abuse and corruption? (According to the Article). Why were the procedures in place created FWA&C opportunities?
To begin with these procedures in place created FWAC opportunities (according to the article) because the custodian system had no oversight. The custodians or superintendents manipulated and controlled the entire budget for buildings’ maintenance and all the employees, which later on turned into big fraud such as bribery, extortion, theft, and nepotism. According to Lydia Segal’s article there was no accountability present at custodian system where custodians employed relatives, friends, and lovers for no-show jobs by giving them a lot of overtime and thousands of dollars. Segal stated that in 1993 …show more content…
the state wanted to create some type of oversight and passed the law that custodians must be accountable to the principal, but this system did not work. As a result, the custodian system lacked oversight by giving the opportunity for malfeasance.
As a commissioner to change this fraudulent organizational culture I would create a reporting system by making an extra position and hire an Inspector General (IG) to oversight custodian system. Also, this reporting system would include the semiannual reports of the performance and budgetary statements of cash flow.
2) As Commissioner how will you plan and/or make procedures to ensure the public, students, parents of other workers within the DOE that fraud, waste, abuse and corruption will not occur or be mitigated according to the article?
According to the article by Lydia Segal the internal controls for custodians was principal; however, principals oversight was worthless because principals were frightened of custodians because custodians could always turn off the heat and hot water, or if there were any events at school they would lock the auditorium and bathrooms. According to Segal, custodian system is also known as indirect system that granted custodians no supervision. Therefore, as a commissioner to prevent FWAC within the DOE, I would set up internal controls that would oversight the organization. By doing so, there first must be established the accountability techniques such as compliance accountability – which is to ensure conformity with the carefully written rules and regulations; performance accountability – which centers on the desired outcomes, such as to prevent abuse and have an impact before something happens; and capacity based accountability – which involves the creation of organizational competence through people, systems, and structures. Moreover, according to Segal’s article there are thousands of dollars involved in the custodian system; therefore, I would create a separation of duties or responsibilities because there must be a sufficient separation of duties and responsibilities among workers who execute accounting procedures or control activities and those who handle the assets. This would create the check and balances which would be one of the roles of the employees to even oversight each other. In addition, I would make a reconciliation of bank accounts and management review to create an insight into the differences between agency’s assets equilibrium per the balance sheet and per the bank statement and the accurateness of the recorded data.
3) As Commissioner how will you measure performance within the custodial system?
Identify what were the problems with performance and what would be your solutions to this issue?
The problems with performance, within the custodian system were the nonfeasance. As Segal stated in the article that the custodians’ central purpose is to maintain a clean, safe learning environment but it was the opposite. Also there was nobody to measure the performance but principal. As a commissioner to measure performance within the custodial system I would hire an IG to execute the performance audit – to evaluate if the organization does what has to be done; and financial audit – to insure if custodians spent the money on what they were supposed to spend it. My solution for preventing the problems with performance is to have internal controls that oversight the procedures of this culture by establishing a bureaucracy where an annual audit must be performed and compliance review if
necessary.