Weak Internal Controls Make the Department of Labor and Selected CETA Grantees Vulnerable to Fraud, Waste, and Abuse
AFMD-81-46
Published: Mar 27, 1981. Publicly Released: Mar 27, 1981.
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Highlights
GAO reviewed activities in the Department of Labor and selected Comprehensive Employment and Training Act (CETA) grantees to determine: (1) whether Labor had a system of internal controls to protect adequately against fraud, waste, and abuse; and (2) how grantees of the CETA program protect against improper use of federal funds and assets.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Labor | The Secretary of Labor should require regional offices to establish and/or effectively implement controls over separation of duties for those employees handling Comprehensive Employment and Training Act cash receipts from prime sponsors. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require the Department to seek competitive bids on proposed procurements and to evaluate the results of a contractor's ongoing performance before granting additional funding. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require Labor headquarters, regional offices, and all grantees to thoroughly review vendor-submitted invoices and compare them with supporting documentation to determine whether they are legitimate or have already been paid. |
Closed – Not Implemented
The CETA program ended October 1, 1983, therefore, the recommendations concerning CETA are no longer valid.
|
| Department of Labor | The Secretary of Labor should require that the payroll system include data on employees' outstanding travel advances so advances can be liquidated promptly through deduction from wages. |
Closed – Not Implemented
OIG is doing a review of this area.
|
| Department of Labor | The Secretary of Labor should more aggressively impose sanctions upon grantees who have not corrected previously known management and internal control deficiencies. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require Labor's Comptroller to write and implement procedures governing the operation and maintenance of imprest funds and require periodic surprise audits of these funds. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require the Office of the Inspector General (OIG) to examine the automated procurement system and, after it is fully operational, determine whether controls built into the system are adequate to protect against payment of duplicate invoices. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require the Department's payment services group to review disbursements to vendors who have previously received duplicate payments to determine whether more have occurred and, if so, take steps immediately to collect these duplicate payments. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require the Department's Comptroller to implement consistently the employee termination procedure so that the office responsible for controlling travel advances must indicate whether a departing employee has an outstanding advance. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require OIG to audit the regular and supplemental payroll systems to ensure that improvements have been made and to determine whether they provide adequate controls over payroll disbursements. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require OIG to conduct reviews of prime sponsor independent monitoring units to ensure that: (1) Employment and Training Administration regulations are followed; and (2) they are properly staffed with personnel skilled in evaluating internal controls. |
Closed – Not Implemented
The CETA program ended on October 1, 1983, therefore, the recommendations concerning CETA are no longer valid.
|
| Department of Labor | The Secretary of Labor should require headquarters and regional office property staff to: (1) promptly enter newly purchased property into inventory records and into the general ledger system and to reconcile the records periodically; (2) take regular physical inventories; (3) segregate duties to provide adequate checks and balances; and (4) attend training courses that will increase their understanding of sound controls over property. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require headquarters and regional office staff to ensure that audits of subgrantees are performed when required and that they include an evaluation of internal controls. |
Closed – Not Implemented
The CETA program ended on October 1, 1983, therefore, the recommendations concerning CETA are no longer applicable.
|
| Department of Labor | The Secretary of Labor should require OIG to determine the amount of resources necessary to perform needed audits as soon as the Department's responsibility under the single audit concept becomes clear. Resources should include the Labor audit staff and the funds necessary to engage independent public accountants and state or local government auditors. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
| Department of Labor | The Secretary of Labor should require headquarters and regional office staff and prime sponsors to aggressively enforce existing requirements that cash collections be safeguarded, recorded, and promptly deposited upon receipt. |
Closed – Implemented
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
|
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Topics
EducationFederal fundsFederal grantsFraudFunds managementInformation systemsProgram abusesProgram managementProperty and supply managementRisk managementCETA programs