The OIG will be alert for new or revised areas of ARC operations based on the priorities and emphasis of ARC management, including results of strategic planning initiatives. Audit planning will include consideration of such initiatives with the overall goal being to ensure coverage of high priority, including high dollar, areas in order to assist management to fulfill their responsibilities for effective and efficient program operations.

Of particular importance is maintaining the flexibility of the audit plan to address changing needs and priorities. Coordination with ongoing ARC efforts to implement an entity-wide strategic plan is considered an important element of planning, and discussions with ARC management have identified several areas for review.

The OIG's strategies and objectives for the next 5 years are defined in a strategic plan. The FY 2003 Annual Plan provides the operational details for OIG activities during FYs 2002-2005 to implement this strategic plan. We expect to revise this strategic plan periodically until our experiences validate our planning assumptions and a comfort level with how we have programmed activities over this extended time period has been achieved.

Planned FY 2003 audit work included about 30 individual grant audits in the Appalachian States; additional followup on grants with completed budget periods, grant extensions, and project results; and tests of the J-1 Visa Waiver program. The work not performed during the past fiscal year will be carried over to the upcoming fiscal year. Continued emphasis will be placed on audit followup and corrective action plans, including working with agency management to address open issues and achieve audit resolution and closure. Further emphasis will be placed on audits performed prior to grant completion. This method will allow the auditors to spot problems during the period of performance and will allow the grantees, who are usually smaller entities, to correct problems mid-stream and avoid grant closeout problems that, in many cases, the grantee cannot afford to remedy. The proactivity with the grantees serves not only the grantee but also the Commission as it allows for a better use of funding and a greater likelihood of mission accomplishment.

In order to maximize use of available resources directed at reviewing ARC activities, emphasis will continue to be placed on nonstandard reporting formats including memorandum, letter, and survey reports. Although such reporting formats reduce the time and resources necessary for review completion, the results and information included in such reports are based on evidence and supporting documentation consistent with generally accepted auditing standards.