Financial Management: Status of BIA's Efforts to Resolve Long-Standing Trust Fund Management Problems

GAO discussed the Bureau of Indian Affairs' (BIA) management of Indian trust funds, focusing on: (1) BIA actions to correct past trust fund operational problems; and (2) proposed trust fund legislation. GAO noted that: (1) BIA could not meet its fiduciary responsibility of ensuring that proper controls and accountability are maintained over Native American trust fund accounts; (2) the Office of Management and Budget has classified BIA trust fund accounting as high-risk because of its poor accounting record; (3) although BIA has improved trust fund management by issuing a trust fund management strategic plan, reconciling backlogs, distributing past oil and gas royalties, and completing an organizational and staffing analysis, BIA has not timely implemented recommendations or realistically estimated the time needed for its reconciliation project; (4) BIA lacks adequate accounting policies and procedures and sufficient staff; (5) BIA needs to work with other Interior departments to correct its trust fund management problems; and (6) proposed trust fund legislation requires the Secretary of the Interior to provide adequate accounting systems, reconciliation controls, account statements to account holders, annual trust fund audits, and a program to assist and train Native Americans in trust fund management.