(1) Each internal auditor and department management shall report immediately to the department head if the internal auditor or management becomes aware of particularly serious or flagrant problems, abuses, or deficiencies relating to the administration of programs or operations of that principal department or its state agencies. If criminal activity is suspected, the department head shall immediately submit a report to the governor, attorney general, and the auditor general in accordance with reporting requirements established pursuant to section 484. Departments shall establish incident reporting protocols, reviewed and approved by the principal department director, to fulfill the reporting of all suspected serious problems by either internal audit or department management. Incidences warranting reporting under these provisions shall include those perpetrated by state employees or external entities with whom departments come into contact.

  (2) Within 60 days after the receipt of a report filed pursuant to subsection (1), the department head shall submit a plan to correct the problems, abuses, or deficiencies to the state budget director. Within 30 days after the receipt of the plan to correct, the state budget director shall submit copies of the plan to correct to the auditor general and the senate and house appropriations committees.

  (3) This section shall not be construed to authorize the public disclosure of information which is part of an ongoing criminal investigation or which is specifically prohibited from public disclosure by any other provision of law.