Economics & Trade Policy Politics and Governance

Auditor’s Paradise: Coolio’s Elements of an Audit Finding

If, to paraphrase Justice Louis Brandeis, a little publicity is “the best of disinfectants,” then consider government auditors the cleaning people. These auditors help focus the public and their leaders’ attention on all aspects of government in order to root out waste, fraud, and abuse.

By allowing the public and their elected leaders to scrutinize government’s inner workings, auditors help keep government clean. Given government’s longstanding reputation for complexity, this may seem like an almost impossible task.

Indeed, auditing is not an easy job. To help them effectively examine government programs, auditors have developed certain procedures that help them break down their research into smaller, more manageable pieces.

One of the main ways auditors do this is by organizing their planning, research, and reports around something they call a ‘finding.’ Essentially, a finding is a statement that summarizes what auditors discovered during their research. Each finding is composed of four main elements: criteria, condition, cause, and effect.

Together, these elements let auditors lay out how government should ideally be functioning (criteria), how it actually is functioning (condition), why it is functioning that way (cause), and the consequences of how it is functioning (effect).

To understand each of these elements, we look to the greatest auditor of all: Coolio. [1] In one of his finest reports, “Gangsta’s Paradise,” Coolio presents his findings regarding the failures of inner-city schools:

“They say I gotta learn, but nobody’s here to teach me. If they can’t understand it, how can they reach me? I guess they can’t, I guess they won’t, I guess they front. That’s why I know my life is out of luck, fool”

In this brief passage, Coolio succinctly presents all the elements of a finding. Let’s take a look.

Criteria: They say I got to learn.

Here, Coolio lays out the criteria against which he will evaluate what he is observing. Criteria essentially describe what an auditor should find when he evaluates a program. Auditors use these criteria like measuring sticks to assess whether that program is functioning the way it should. Usually, auditors use generally accepted criteria, like industry standards or goals from the program they are auditing.

In this case, Coolio is evaluating the inner-city education system and has selected as his criterion the generally accepted principle of compulsory education. Per this criterion, he should be learning – but what is actually happening?

Condition: Nobody’s here to teach me.

After laying out his criteria, Coolio takes a look at the facts on the ground. This is the condition: a description of what auditors are finding when they examine a program. Sure, Coolio’s criteria say he should be learning, but the fact of the matter is that nobody is here to teach him – at least, nobody that can identify with him enough to get through to him.

Cause: If they can’t understand it, how can they reach me?

In order to address the condition, auditors try to figure out what is causing it. Often, there are many different causes contributing to the condition. An auditor’s job is to narrow those causes down to the ‘root causes.’

This can be an auditor’s most difficult task. In Coolio’s case, it could be that no one has been able to get through to him because he “was raised by the streets” and “had to get down with the hood team” or because “too much television watching got [him] chasing dreams.”

Coolio considers those causes when he looks at the situation that they have him facing, but he ultimately identifies a different root cause. His supposed teachers do not understand what his life is like.

Effect: I guess they can’t, I guess they won’t, I guess they front.

Finally, Coolio describes the effects of everything he has observed so far. He has already told us that he does not have any effective teachers because these individuals do not understand his life. What are the consequences of this situation?

Coolio says the result is that his teachers are unable to educate him and instead try to act like they understand him, which only compounds the problem. Without that education, -Coolio knows his life is out of luck.

As Coolio demonstrates, the finding is an incredibly powerful auditing tool. It allows auditors to structure their thoughts effectively and efficiently – and in doing so, it helps them communicate their conclusions to the public and to government leaders in a way that makes sense. Also, laying out the criteria, condition, cause, and effect in a structured manner helps auditors develop effective recommendations for how to address the auditee’s issues.

As Coolio notes, “Everybody’s running, but half of them ain’t looking.” For auditors, ‘looking’ is their job – and taxpayers are the better for it.

[1] Coolio, to my knowledge, has not received any formal auditor training.

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