University at Albany
Internal Control Program
Manager Training
Internal Control Officer: Steve Beditz
Internal Control Coordinator: Darri Scalzo
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Objective
Brief overview of internal controls what they are and why we need them
Why Internal Controls?
It is the LAW!
The NYS Governmental Accountability,
Audit and Internal Control Act of 1987
• Also called the “Internal Control Act”
• Made permanent in Chapter 510 of Laws of 1999
• Requires all state agencies, including SUNY
campuses, to institute an internal control program
Why Internal Controls?
It is the LAW!
The Division of Budget’s Budget Policy and
Reporting Manual Item B-350,
Governmental Internal Control and Internal
Audit Requirements
• Requires all state agencies to perform certain
internal control responsibilities
• Requires all state agencies to certify each year that
they are in compliance with these internal control
requirements and the Internal Control Act.
History of Internal Controls
at UAlbany
• Internal Control Program on campus since 1989,
but not very far reaching in the late 1990’s and
early 2000’s.
• Nearly found non-compliant in spring 2005
• Program revamped, Steering Committee
appointed, action plan put into place as required
by System Administration
• Currently in second phase of action plan –
Employee training and internal control reviews
Definition of Internal Controls
Internal controls are the integration of the
activities, plans, attitudes, policies, and
efforts of the people of an organization
working together to provide reasonable
assurance that the organization will achieve
its mission.
Examples of Internal Controls
Used Every Day
• Separating duties among employees so that
no one employee controls all aspects of any
transaction or process
• Locking office doors each evening
• Traffic lights and stop signs located at each
intersection
• Painted signs or stickers on glass doors and
plate glass windows
In work environments, we use the
term Internal Controls because:
• They are used to ensure that our internal
operations work the way we want so that we
accomplish what we want
• They are managed and used by people
within the organization
• They are built into our work activities
Internal Controls help us to:
• Operate effectively and efficiently - or in other
words to do the right things in the right way
• Provide quality products and services
• Ensure that we comply with all applicable laws,
regulations, policies, and contracts
• Protect our assets and resources
• Develop, maintain, use, and provide
data that is accurate and reliable
Internal Controls help protect us
from risks - the things that could go
wrong and prevent us from
accomplishing our goals
Internal Controls and
Risk Management
• First we must identify our goals
• Then we need to determine what could go
wrong in trying to achieve those goals those things are Risks
• Next we decide how to manage those risks
Implement internal controls to decrease the
chance that something will go wrong;
OR
 Live with the risk

Internal Controls - What we use to
decrease risks and help make sure
things happen the way we want
• People doing things
• Things put into place
by people
Internal Controls - What we use to
decrease risks and help make sure
things happen the way we want
• Preventive - stop
unwanted events from
happening
• Detective - identify
unwanted events that
have occurred
Examples of Internal Controls
Preventive
• Segregation of duties -
Detective
• Physical inventories -
dividing responsibilities so
that no one person
controls an entire activity
and thereby could cause
and conceal errors or fraud
inspect assets on hand
and match to assets
recorded in the books to
detect any missing items
• Safety procedures precautions taken to help
prevent accidents
• Supervisory reviews review of work
performed to detect any
errors
Why Internal Controls?
Good Business Sense
• In order to succeed, an organization must
manage its operations effectively
• Internal controls provide reasonable
assurance that an organization meets
established objectives and goals
• Internal controls decrease the risks to an
organization
What if we do not have
Effective Internal Controls?
• We could fail to meet our goals and
objectives
• We might violate laws or regulations
• We may lose assets and/or opportunities
Can Things Really Go Wrong Here?
Unfortunately - Yes!
They can and have.
In the past few years, there have been a
number of disciplinary and legal situations
on campus that at their core involved a
breach of internal controls.
Recent Examples of Internal
Control Breaches at UAlbany
1. An employee falsely claimed to be going on a
business trip and signed out a state vehicle for that
trip. He actually went to visit family, and got into
a car accident in the state vehicle. He attempted to
cover it up but the vehicle was damaged and an
investigation revealed there was no business
purpose for the trip or vehicle use.
Recent Examples of Internal
Control Breaches at UAlbany
2. An employee used a state vehicle to go off campus
to dine without the knowledge or approval of his
supervisor. The employee also did not use break
time but rather stayed on the clock while dining
off campus.
Recent Examples of Internal
Control Breaches at UAlbany
3. State owned property and equipment is for official
University business only. Several instances of
inappropriate use of state assets have been
uncovered, including use of fax machines and
copiers to support a political candidate and use of
laundry equipment for personal wash.
Recent Examples of Internal
Control Breaches at UAlbany
4. Employees who are “on the clock” are expected to
be working as they are being paid by the state to
work. Several recent cases have arisen of
employees being caught sleeping on the job either
by other employees or by students.
Recent Examples of Internal
Control Breaches at UAlbany
5. Employees are expected to be honest on their job
applications, but supervisors must thoroughly
check references and backgrounds before hiring an
applicant. One employee checked on his
application that he had never been convicted of a
felony but then was overheard remarking that he
had. An investigation revealed that he had in fact
been convicted and falsified his application.
Recent Examples of Internal
Control Breaches at UAlbany
6. Reports containing personal identifiable
information for students were being left in
recycling bins without any assurance or guarantee
that the information was being shredded or
properly secured before disposal.
Internal Controls are
IMPORTANT
for every area of the University
• No matter how big or how small the
department is
• No matter whether or not the department
handles money
• No matter whether or not the department
handles confidential information
Who has a role in
Internal Controls?
Everyone!
Who is responsible for
Internal Controls?
• Every employee has the responsibility to help
ensure that internal controls are effective by
following controls and reporting problems or
suggesting improvements
• The greatest amount of responsibility rests with
deans, department chairs, and managers to assure
appropriate controls are in place for all operations
• The President has the ultimate responsibility, and
must sign the annual certification that UAlbany is
in compliance with the Internal Control Act
Internal Control Program Contacts
Darri Scalzo, Internal Control Coordinator
Phone: 956-8092
E-mail: dscalzo@uamail.albany.edu
http://www.albany.edu/internalcontrol/
Other Important Contacts
Martin Manjak, Information Security Officer
Phone: 437-3813
E-mail: mmanjak@uamail.albany.edu
http://www.albany.edu/its/besecure.htm
Janet Thayer, Associate Counsel
Phone: 956-8050
E-mail: jthayer@uamail.albany.edu
To provide an audit trail of
who has received this state-required
Internal Control training, please click on
the link below and complete the attached
form before closing this presentation.
www.albany.edu/internalcontrol/ICTrainingRecord.shtml
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Thank you for your participation!