Office of Thrift Supervision:

Stronger System Controls Needed to Prevent Call Report Delays

IMTEC-92-22: Published: Feb 14, 1992. Publicly Released: Feb 14, 1992.

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Pursuant to a congressional request, GAO reviewed the Office of Thrift Supervision's (OTS) delay in issuing quarterly data on thrifts' operating conditions, focusing on the: (1) cause and extent of the delay; and (2) adequacy of OTS steps to correct the problem.

GAO found that: (1) during the processing of thrifts' call report data for the quarter ending September 30, 1990, a contractor experienced a communications failure and inadvertently destroyed data maintained on the system; (2) an OTS attempt to restore the data unintentionally erased data tapes; (3) OTS did not ensure, before attempting to restore tapes, that it had backup tapes, and used software that was not designed or authorized for restoration; (4) OTS had to re-edit and verify the data it received from thrifts, and the National Technical Information Service did not receive the data until 39 days after the target date for issuance; and (5) OTS lacks formal policies and procedures for system maintenance, system backup, and data restoration. GAO also found that, since the delay, OTS has: (1) developed draft policies and procedures for systems maintenance; (2) issued a manual formally documenting policies and procedures for system operation, backup, and restoration; (3) shifted maintenance duties from the contractor to OTS staff for closer control and supervision; and (4) assigned quality assurance responsibilities to OTS technical staff responsible for systems operation. GAO believes that the steps do not adequately address quality assurance weaknesses, since: (1) assigning quality assurance duties to OTS staff responsible for systems operation presents conflicting duties and impairs the independence of quality assurance; and (2) operational responsibilities would be given priority over quality assurance.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: OTS: (1) finalized its system maintenance policies and procedures; and (2) hired two data-base administrators to improve the backup and restoration procedures for quarterly thrift call reports. However, the OTS Director has decided against committing the resources to establish a quality assurance function, citing other priorities such as hiring additional thrift examiners.

    Recommendation: To ensure the timely release of thrift call reports, the Director, OTS, should strengthen system controls. Such action should include: (1) finalizing policies and procedures on system maintenance; and (2) establishing a quality assurance function independent of operations.

    Agency Affected: Department of the Treasury: Office of Thrift Supervision

 

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