Cash Management:

Diners Club Business Travel Management Program Needs Improvement

AFMD-90-66: Published: Apr 30, 1990. Publicly Released: May 30, 1990.

Additional Materials:

Contact:

Jeffrey C. Steinhoff
(202) 512-9454
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Pursuant to a legislative requirement, GAO studied the difficulties surrounding the government's use of credit cards, focusing on the key benefits and problems associated with the Diners Club business travel management program.

GAO found that: (1) agencies believed that they benefited from employees' use of individual charge cards; (2) some agencies reduced employees' need for travel advances and improved the government's cash flow by using the charge card; (3) the charge card enabled employees to carry less cash when travelling on business; (4) most agencies did not take full advantage of program benefits; (5) agencies did not survey employees to assess their concerns about the charge card program; (6) some employees used charge cards for unauthorized purposes or did not pay their bills on time; (7) some agencies experienced increased interest costs because they had problems reconciling their centrally billed accounts; and (8) the automatic teller machine (ATM) program may not be the most cost-effective method of issuing cash travel advances and needs improved controls.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: GSA issued regulations on December 3, 1990 providing for the use of ATMs. These regulations require agencies interested in implementing the ATM program to develop program controls to ensure that ATM withdrawals are for authorized purposes and within allowable amounts.

    Recommendation: The Administrator of General Services and the Secretary of Defense should establish regulations for the Diners Club ATM program. Those regulations should include provisions requiring agencies interested in implementing the Diners Club ATM program to establish controls to ensure that ATM withdrawals are for authorized purposes and within allowable amounts.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: The Office of the Comptroller, Department of Defense (DOD), issued guidance directing components considering the adoption of the ATM program to conduct cash-benefit analyses. These are to be submitted to the Office of the Comptroller for review and forwarding to GSA.

    Recommendation: The Administrator of General Services and the Secretary of Defense should establish regulations for the Diners Club ATM program. Those regulations should include provisions requiring agencies interested in implementing the Diners Club ATM program to perform a cost analysis comparing the ATM method with other methods of issuing travel advances, such as travelers checks, imprest funds, and Treasury checks. Agencies should be required to submit their analysis to GSA for its review and consideration when deciding whether or not to approve an agency for participation in the ATM program.

    Agency Affected: General Services Administration

  3. Status: Closed - Implemented

    Comments: GSA issued an amendment to the Federal Travel Regulation (FTR) requiring agencies interested in implementing the program to submit to GSA for review a cost analysis comparing the ATM method with other methods of issuing travel advances.

    Recommendation: The Administrator of General Services and the Secretary of Defense should establish regulations for the Diners Club ATM program. Those regulations should include provisions requiring agencies interested in implementing the Diners Club ATM program to perform a cost analysis comparing the ATM method with other methods of issuing travel advances, such as travelers checks, imprest funds, and Treasury checks. Agencies should be required to submit their analysis to GSA for its review and consideration when deciding whether or not to approve an agency for participation in the ATM program.

    Agency Affected: General Services Administration

  4. Status: Closed - Implemented

    Comments: Diners Club initiated development of a GTS Reconciliation/Account Balancing System to assist federal agencies in reconciling their Diners Club centrally billed accounts.

    Recommendation: The Director, OMB, should issue, as part of the directive regarding the government's use of the Diners Club business travel management program, a requirement to the heads of agencies and departments to ensure prompt review of past due amounts on the Diners Club centrally billed accounts. This requirement should ensure that unsupported items on those accounts are researched to determine the validity of charges.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  5. Status: Closed - Implemented

    Comments: OMB did not take any action on this recommendation and is relying on GSA. GSA, however, has no policy oversight over defense agencies on this matter.

    Recommendation: To ensure effective implementation of the Diners Club individual charge card program and to realize additional cash management benefits offered by this program, the Director, Office of Management and Budget (OMB), should issue a directive to the heads of agencies and departments on the government's use of the Diners Club business travel management program. This directive would require that the General Services Administration (GSA) survey federal employees on their views regarding the program and that agencies comply with existing policies governing the Diners Club individual charge card program and related travel policies and procedures, including: (1) limiting travel advances to meals and incidental expenses and miscellaneous expenses, such as taxis, tolls, and parking; (2) paying employee travel reimbursements within 25 working days after the completion of a trip; (3) developing a program to encourage employees to use their Diners Club individual charge cards to purchase transportation tickets; and (4) quantifying the cash management benefits attributable to the Diners Club individual charge card program. The directive should also clearly define the agencies' role and responsibilities with respect to employees who use their Diners Club individual charge cards for personal purposes or are delinquent in paying Diners Club bills.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  6. Status: Closed - Not Implemented

    Comments: DOD partially concurred in this recommendation. It felt that abusers can be identified only after the fact. Thus, it plans to identify abusers in reviewing travel vouchers.

    Recommendation: The Administrator of General Services and the Secretary of Defense should establish regulations for the Diners Club ATM program. Those regulations should include provisions requiring agencies interested in implementing the Diners Club ATM program to establish controls to ensure that ATM withdrawals are for authorized purposes and within allowable amounts.

    Agency Affected: General Services Administration

 

Explore the full database of GAO's Open Recommendations »

Nov 20, 2014

Nov 17, 2014

Nov 12, 2014

Nov 10, 2014

Nov 7, 2014

Nov 6, 2014

Sep 22, 2014

Looking for more? Browse all our products here