How the Farm Credit Administration Can Improve Its Use of Auditing

GGD-81-22: Published: Jan 28, 1981. Publicly Released: Jan 28, 1981.

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The Farm Credit Administration (FCA) is given the authority to supervise and coordinate the activities of the cooperative Farm Credit System. An evaluation was performed of the use of auditing by FCA and its support of the use of auditing within the System.

Although FCA has recognized the need for an independent internal review of its management activities, it has not done enough to encourage the development of internal audit activities throughout the System. Specifically, FCA has not: (1) provided leadership for the development of System-wide internal auditing standards; (2) furnished active, consistent support to the System's Internal Auditors Conference; and (3) consistently reported on the progress and problems of internal auditing activities in its reviews of bank operations.

Recommendations for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Federal Farm Credit Board should direct the Governor of FCA to monitor the implementation of the revised internal control policy to insure that independent bank internal audit functions are maintained.

    Agency Affected: Farm Credit Administration: Federal Farm Credit Board

  2. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Federal Farm Credit Board should direct the Governor of FCA to require that the Office of Examination reports to a bank's Board of Directors comment on the quality of the internal auditing system.

    Agency Affected: Farm Credit Administration: Federal Farm Credit Board

  3. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Federal Farm Credit Board should direct the Governor of FCA to furnish active, consistent support for the FCS Internal Auditors' Conference.

    Agency Affected: Farm Credit Administration: Federal Farm Credit Board

  4. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Federal Farm Credit Board should direct the Governor of FCA to provide leadership to the FCS to develop a set of professional internal auditing standards which will provide a basis for a more thorough evaluation of internal audits by both FCA and bank management as well as encouraging professionalism within bank internal audit units.

    Agency Affected: Farm Credit Administration: Federal Farm Credit Board

  5. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Governor of FCA should augment his financial examination efforts by using external auditors to ensure that financial examination procedures are in conformance with generally accepted auditing standards.

    Agency Affected: Farm Credit Administration

 

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