ADP Management Controls:

Farmers Home Administration Can Improve Reporting of Weaknesses

IMTEC-88-38: Published: Jul 25, 1988. Publicly Released: Jul 25, 1988.

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GAO determined whether the Farmers Home Administration (FmHA) identified, corrected, and reported its automatic data processing (ADP) weaknesses in compliance with the Federal Managers' Financial Integrity Act of 1982 (FMFIA).

GAO found that FmHA failed to: (1) submit for inclusion in the Department of Agriculture's (USDA) annual FMFIA reports the specific ADP management weaknesses which USDA and Treasury identified in their management reviews; (2) identify widespread patterns of weaknesses occurring among states in its management control reviews of field offices; (3) report that field office internal controls over loan servicing and collection activities were inadequate; (4) correct two ADP weaknesses concerning access controls and its priority-setting process for system design requests, which it had previously reported as corrected; or (5) verify the implementation or effectiveness of corrective actions for uncorrected weaknesses.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: FmHA implemented a process whereby the Internal Control Audit Liaison Branch requires specific documentation supporting a corrected weakness before reporting the weakness as corrected. For example, if the weakness is the need for additional training, documents such as course agenda and participants would be required.

    Recommendation: To ensure that the FmHA FMFIA process identifies, corrects, and reports all FmHA ADP management weaknesses, as called for by USDA implementation of that act, the Secretary of Agriculture should ensure that proposed actions to correct weaknesses are adequate, by verifying their implementation and effectiveness before reporting that the weaknesses are corrected.

    Agency Affected: Department of Agriculture

  2. Status: Closed - Implemented

    Comments: FmHA and USDA both reported in their 1988 FMFIA reports that inadequate loan supervison contributed to delinquent loans and other problem cases. Additional internal control weaknesses were reported in FmHA and USDA 1989 reports. All weaknesses were identified either through OIG audits or agency internal control reviews. Weaknesses continue to be reported until corrective actions are completed.

    Recommendation: To ensure that the FmHA FMFIA process identifies, corrects, and reports all FmHA ADP management weaknesses, as called for by USDA implementation of that act, the Secretary of Agriculture should include in future USDA FMFIA reports the specific weakness that FmHA field office internal controls over loan servicing and processing are inadequate, until the weakness is corrected.

    Agency Affected: Department of Agriculture

  3. Status: Closed - Implemented

    Comments: During fiscal year 1988, one unit, the Internal Control Audit Liaison Branch, became responsible to receive all reports and analyses of which internal control is a part. FmHA believes that this will provide a more complete picture of the internal control system in FmHA.

    Recommendation: To ensure that the FmHA FMFIA process identifies, corrects, and reports all FmHA ADP management weaknesses, as called for by USDA implementation of that act, the Secretary of Agriculture should ensure that field office evaluations are an integral part of the FmHA FMFIA process by requiring that evaluation results be fully analyzed so that widespread patterns of weaknesses are properly identified and included in the USDA FMFIA reports.

    Agency Affected: Department of Agriculture

  4. Status: Closed - Not Implemented

    Comments: In 1988, FmHA reported to the Secretary of Agriculture, as a corrected weakness, that management oversight and control of its strategic financial systems could be improved. USDA does not believe that other weaknesses included in the referenced studies are appropriate for including in the USDA FMFIA report.

    Recommendation: To ensure that the FmHA FMFIA process identifies, corrects, and reports all FmHA ADP management weaknesses, as called for by USDA implementation of that act, the Secretary of Agriculture should include in the USDA FMFIA annual report specific ADP management weaknesses identified by the 1986 and 1987 USDA and Treasury studies, along with planned corrective actions.

    Agency Affected: Department of Agriculture

  5. Status: Closed - Implemented

    Comments: FmHA issued a directive that sets a strategy to determine priority and specifies standards in this area. This issue was not included in the USDA FMFIA report. Therefore, this issue did not undergo the FmHA process for ensuring that a corrective action is effective.

    Recommendation: To ensure that the FmHA FMFIA process identifies, corrects, and reports all FmHA ADP management weaknesses, as called for by USDA implementation of that act, the Secretary of Agriculture should include in future USDA FMFIA reports the weakness and planned corrective actions concerning the ineffective priority-setting process for reducing the backlog of system change requests until the weakness is corrected.

    Agency Affected: Department of Agriculture

 

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