Weaknesses in Internal Financial and Accounting Controls at DOE Accounting Stations

AFMD-81-106: Published: Sep 17, 1981. Publicly Released: Sep 17, 1981.

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GAO made a survey of the accounting controls over revenue and expenditure transactions at 10 accounting stations within the Department of Energy (DOE). The survey was based on questionnaires designed to identify potential internal control problems and on interviews and discussions with accounting station officials. When responses indicated potential weaknesses, GAO tested selected transactions to determine if the weaknesses existed but did not attempt to establish their extent or the precise corrective actions which were needed.

The survey identified weaknesses in internal controls over accounts receivable, collections, disbursements, imprest funds, and obligations. In addition, GAO noted a lack of audits of internal control procedures by DOE auditors and a general absence of local operating instructions. GAO found that: (1) accounts receivable were inadequately controlled, many receivables were not entered in the accounting records, and those that were recorded were not monitored to ensure timely collections; (2) collections were ineffectively safeguarded, were not properly logged in, correctly accounted for, or promptly deposited; (3) disbursements were made without complying with established procedures, preaudits were inadequate to preclude duplicate payments or overpayments, single monthly travel vouchers were not used, and Government transportation requests and airline tickets were ineffectively controlled; (4) imprest funds were poorly managed, were not periodically verified or audited, and opportunities to reduce fund balances had not been explored; (5) obligations were not properly handled, commitments were made before funds were certified as being available, and obligations were not validated at yearend; and (6) operating instructions and audit coverage were inadequate, written procedures were nonexistent or in draft form, and internal control audits were not being performed. Adequate internal audit coverage could have detected most of the control deficiencies discussed, thus, providing the agency management with the opportunity to correct them.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Energy should ensure that adequate followup actions are taken to correct the weaknesses GAO has identified.

    Agency Affected: Department of Energy

  2. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Energy should ensure that written procedures covering all aspects of financial and accounting operations, including related internal controls, are developed and issued to all appropriate Department offices.

    Agency Affected: Department of Energy

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Energy should issue instructions emphasizing that the Department's fiscal procedures and instructions must be followed.

    Agency Affected: Department of Energy

  4. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Energy should instruct the Inspector General's office to increase its audit coverage of the Department's internal financial operations with particular emphasis on internal controls.

    Agency Affected: Department of Energy

 

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