OPM's Revolving Fund Policy Should Be Clarified and Management Controls Strengthened

GGD-84-23: Published: Oct 13, 1983. Publicly Released: Oct 13, 1983.

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GAO reported on activities financed by the Office of Personnel Management's (OPM) revolving fund, focusing on the planning, budgeting, and other financial management aspects of the fund.

GAO noted that the two major activities of the fund, personnel investigations and training, had created revenues of $28.2 million and $37.3 million respectively for fiscal year (FY) 1982. Although the fund has produced revenue from training activities, personnel investigations have caused deficits in the fund. OPM did not make substantial progress in resolving financial problems in the investigations activity until early in FY 1982. Further, OPM did not operate its training activity on an actual cost basis in the past because it did not recover all operating costs of executive training. GAO believes that revolving fund budgets could not be used effectively for monitoring and controlling activities before FY 1982, since budget guidance was inadequate.

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 Director, OPM, should clearly define the terms "actual cost basis" and "reasonable period of time." The clarification should: (1) state the period of time over which actual costs must be recovered; (2) require activities to account for and recover their full costs; and (3) prohibit using appropriated funds to pay for revolving fund expenses.

    Agency Affected: Office of Personnel Management

  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 Director, OPM, should: (1) establish financial performance standards for revolving fund activities and require written plans for correcting deviations from the standards; and (2) require that plans and budgets for subsequent years recognize past financial performances and identify how and when financial problems will be corrected.

    Agency Affected: Office of Personnel Management

 

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