This Week
  • Architect David Hanlon has worked with some of the area's leading developers.

  • For startup companies, legal and accounting missteps can prove costly.

  • Wilmorite hopes soon to win approval for $425M casino in Seneca County.

  • ID Signsystems Inc. has grown from a local company into an international business.

  • Robert Linton guides Jazz 90.1 through a new era in media.

  • The RBJ 75 supplement presents a list of the 75 largest private-sector employers.

Auditing the comptroller

Rochester Business Journal
August 23, 2013

In his capacity as state comptroller, Thomas DiNapoli issues a steady stream of audits that highlight lax practices at state agencies and local government offices. It's a useful and important function, providing oversight of public officials throughout the state.
 
This week, however, Mr. DiNapoli found himself at the other end of a critical audit by a state watchdog. In the first of a series of audits of the New York State Common Retirement Fund, which the comptroller manages and for which he is sole trustee, the Department of Financial Services "uncovered serious information technology problems ... that are putting retirees and taxpayers at significant risk."
 
The Common Retirement Fund, with an estimated value of nearly $160 billion, is the third-largest pension plan in the United States. More than 3,000 state and local government employers participate in the system, and its members, retirees and beneficiaries exceed 1 million.
 
Effective management of this fund clearly is a huge responsibility and no simple task. But the job is even harder, the DFS auditors determined, because of antiquated technology, outdated software and other IT shortcomings.
 
For example, the DFS examination revealed that the mainframe computer the comptroller's office uses to process pension transactions is more than 25 years old and runs on even older computer code—written in 1959—in which few programmers are still trained. In addition, the report states, DFS auditors found that "two key operating systems were beyond their manufacturer's support date so they no longer were being updated to protect against ever-evolving security threats."
 
Fund officials acknowledged that its technology programs are "approaching a point of failure," DFS auditors say, but "the replacement process has been halted by 'higher-ups in the comptroller's office.'"
 
Without question, some of these IT problems predate Mr. DiNapoli's tenure as comptroller. And it's true he has worked to implement a number of reforms to increase the accountability and transparency of Common Retirement Fund transactions.

Nonetheless, the auditors' findings point to serious flaws that cannot be ignored. Indeed, as the report states, these deficiencies "must be addressed immediately."

8/23/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


What You're Saying 

There are no comments yet. Be the first to add yours!

Post Your Own Comment

 
Username:
Password:

Not registered? Sign up now!
 

To Do   Text Size
Post CommentPost A Comment eMail Size1
View CommentsView All Comments PrintPrint Size2
ReprintsReprints Size3
  • E-mailed
  • Commented
  • Viewed
RBJ   Google