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    Subject Term: "Financial management"

    93 publications with a total of 272 open recommendations including 50 priority recommendations
    Director: Asif A. Khan
    Phone: (202) 512-9869

    2 open recommendations
    Recommendation: The DHS Under Secretary for Management should develop and implement effective processes and improve guidance to reasonably assure that future AAs fully follow AOA process best practices and reflect the four characteristics of a reliable, high-quality AOA process. (Recommendation 1)

    Agency: Department of Homeland Security
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: The DHS Under Secretary for Management should improve the Risk Management Planning Handbook and other relevant guidance for managing risks associated with financial management system modernization projects to fully incorporate risk management best practices, including (1) defining thresholds to facilitate review of performance metrics to determine when risks become unacceptable; (2) identifying and analyzing risks to include periodically reconsidering risk sources, documenting risks specifically related to the lack of sufficient, reliable cost and schedule information needed to help properly manage and oversee the project, and timely disposition of IV&V contractor-identified risks; (3) developing risk mitigation plans with specific risk-handling activities, the costs and benefits of implementing them, and contingency plans for selected critical risks; and (4) implementing risk mitigation plans to include establishing periods of performance for risk-handling activities and defining time intervals for updating and certifying the accuracy and completeness of information on risks in DHS's risk register. (Recommendation 2)

    Agency: Department of Homeland Security
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Dawn B. Simpson
    Phone: (202) 512-3406

    3 open recommendations
    including 3 priority recommendations
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary to develop and implement procedures and metrics for monitoring the federal government's year-to-year progress in resolving intragovernmental differences for significant federal entities at the reciprocal category and trading partner levels.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, we identified this control deficiency related to monitoring intragovernmental differences. Treasury stated that it will continue to evolve its processes as deemed necessary to ensure that appropriate and effective metrics are deployed to measure and monitor agency performance. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of September 2017.
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary to develop and implement a sufficient process for working with federal entities to reduce or resolve the need for significant adjustments to federal entity data submitted for the CFS.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, we identified this control deficiency related to significant adjustments to federal entity data submitted for the CFS. Treasury stated that it will continue to work with agencies to facilitate improvement of processes, minimizing the need for Treasury adjustments to agency reporting. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of September 2017.
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary, working in coordination with the Controller of OMB, to improve corrective action plans for (1) treaties and international agreements, (2) additional audit procedures for intragovernmental activity and balances, and (3) the Reconciliation Statements so that they include sufficient information to address the control deficiencies in these areas effectively.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, we identified improvements needed to corrective action plans in three areas. Treasury stated that its current remediation plan, including its various corrective action plans, is comprehensive, appropriate, and effective, with robust ongoing monitoring processes in place. However, we continue to believe that the corrective action plans in these three areas do not include sufficient information to effectively address related control deficiencies involving processes used to prepare the CFS. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of September 2017.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    1 open recommendations
    Recommendation: The Secretary of Defense should direct the Office of the Under Secretary of Defense (Comptroller) to provide guidance in the DOD Financial Management Regulation on the timing of when DOD managers should use available tools to help ensure that monthly cash balances are within the upper and lower cash requirements.

    Agency: Department of Defense
    Status: Open

    Comments: DOD concurred with this recommendation and stated that it plans to update the DOD Financial Management Regulation as we recommended to provide additional guidance on the timing of when DOD managers should use available tools to help ensure that monthly cash balances are within the upper and lower cash requirements. DOD also stated that this change will be incorporated for the fiscal year 2019 President's Budget submission and subsequent budgets.
    Director: Seto Bagdoyan
    Phone: (202) 512-6722

    7 open recommendations
    Recommendation: To address control weaknesses and related program-integrity risks we identified in Lifeline, the Chairman of FCC should require Commissioners to review and approve, as appropriate, spending above the budget in a timely manner.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address control weaknesses and related program-integrity risks we identified in Lifeline, the Chairman of FCC should maintain and disseminate an updated list of state eligibility databases available to Lifeline providers that includes the qualifying programs those databases access to confirm eligibility; this step would help ensure Lifeline providers are aware of state eligibility databases and could also help ensure USAC audits of Lifeline providers can verify that available state databases are being utilized to verify subscriber eligibility.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address control weaknesses and related program-integrity risks we identified in Lifeline, the Chairman of FCC should establish time frames to evaluate compliance plans and develop instructions with criteria for FCC reviewers how to evaluate these plans to meet Lifeline's program goals.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address control weaknesses and related program-integrity risks we identified in Lifeline, the Chairman of FCC should develop an enforcement strategy that details what violations lead to penalties and apply this as consistently as possible to all Lifeline providers to ensure consistent enforcement of program violations; the strategy should include a rationale and method for resource prioritization to help maximize the effectiveness of enforcement activities.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address our findings regarding the USF, the Chairman of FCC should take action to ensure that the preliminary plans to transfer the USF funds from the private bank to the U.S. Treasury are finalized and implemented as expeditiously as possible.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address our findings regarding the USF, the Chairman of FCC should take action to require a review of customer bills as part of the contribution audit to include an assessment of whether the charges, including USF fees, meet FCC Truth-in-Billing rules with regard to labeling, so customer bills are transparent, and appropriately labeled and described, to help consumers detect and prevent unauthorized charges.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: To address our findings regarding the USF, the Chairman of FCC should take action to respond to USAC requests for guidance and address pending requests concerning USF contribution requirements to ensure the contribution factor is based on complete information and that USF pass-through charges are equitable.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Clark, Cheryl E
    Phone: (202)512-9377

    10 open recommendations
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to develop and implement a process to reasonably assure that IRS operating divisions and the information technology (IT) organization effectively coordinate with the Chief Financial Officer (CFO) organization when making programming changes to information systems affecting financial reporting.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by December 2017, the Information Technology (IT) organization, in collaboration with the Chief Financial Officer (CFO) organization, will develop and implement a process to reasonably assure that IRS operating divisions and the IT organization effectively coordinate with the CFO organization when making programming changes to information systems affecting financial reporting. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to research and determine the reason the IT organization did not follow IRS policy to thoroughly test programming changes related to the automation of specific penalty abatement procedures to reasonably assure that they worked as intended before implementation. Based on this determination, the IRS Commissioner should direct the appropriate IRS officials to establish a process to better ensure compliance with existing policies for testing programming changes, including the use and review of the Applications Development transmittal checklist when developing program changes and retention of test results.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by June 2018, the IT organization will research IRS policies and practices for testing programming changes to determine what modifications may be needed to reasonably assure programming changes work as intended before implementation. Based on this research, the IT organization will update the affected policies and implement any related process changes, as needed. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to strengthen the process for reasonably assuring that the Internal Revenue Manual (IRM) is reviewed annually to align with the current control procedures and guidance being implemented by agency personnel. This should include a mechanism for reasonably assuring that program owner directors (1) review their respective program control activities and related guidance annually and timely update the IRM as needed, (2) document their reviews, and (3) utilize interim guidance and supplemental guidance correctly for their intended purposes.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by March 2018, the Research, Applied Analytics and Statistics organization will strengthen the process to reasonably assure that all IRMs are reviewed annually to align with the current control procedures and guidance being implemented by IRS personnel. This will include a mechanism to reasonably assure that program owner directors (1) review their respective program control activities and related guidance annually, and update the IRM timely, if needed; (2) document their reviews; and (3) use interim guidance and supplemental guidance correctly for their intended purposes. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to ensure that the respective Agency-Wide Shared Services IRM and supplemental guidance related to the frequency of performing (1) emergency/alarm contact-list validation, (2) duress alarm inventory validation, and (3) federal security risk assessments are consistent.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation and considers it closed. IRS stated that in February 2017, the Agency-Wide Shared Services (AWSS) organization updated SOP-17-0002, Alarm Notification, Testing and Maintenance, to synchronize the frequency of performing (1) emergency/alarm contact-list validation; (2) duress alarm inventory validation; and (3) federal security risk assessments, with revised IRM 10.2.14.9, Methods of Providing Protection, Detection Equipment, and IRM 10.2.11.2.5 (3), Facility Security Risk Management. We will assess IRS's actions during our fiscal year 2017 financial statement audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to update the respective (1) Privacy, Governmental Liaison and Disclosure and (2) CFO IRM sections related to the definition of the tax gap to align with the current understanding followed by IRS personnel.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that in April 2017, the CFO organization updated IRM 1.34.1.2 (124) Revenue Accounting, Definitions and Acronyms, to align the tax gap definition with the current understanding followed by IRS personnel. Further, by February 2018, the Privacy, Governmental Liaison and Disclosure organization will remove the tax gap definition from IRM 11.4.1.3.1.2, Tax Gap Initiatives. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to revise the applicable IRM sections pertaining to manual refunds to require employees to verify the validity of the digital signatures on the manual refund request forms and the manual refund signature authorization forms.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by March 2018, the Wage and Investment (W&I) organization will revise the applicable IRM manual refund sections to require that employees validate the digital signatures on the manual refund request forms and the manual refund signature authorization forms. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to revise system access rights in Human Resources (HR) Connect to prevent HR assistants within the Employment Operations office from approving and releasing pay-related personnel actions to the National Finance Center (NFC).

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation and considers it closed. IRS stated that in February 2017, the Human Capital Office (HCO) revised system access rights in HR Connect to prevent the Employment Operations Office HR assistants from approving and releasing pay-related personnel actions to the National Finance Center (NFC). We will assess IRS's actions during our fiscal year 2017 financial statement audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to revise the HR Connect HR User Profiles Desk Guide to clearly indicate that HR assistants within the Employment Operations office should not be granted access to approve and release pay-related personnel actions to NFC.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation and considers it closed. IRS stated that in February 2017, HCO revised the HR Connect HR User Profiles Desk Guide to clearly indicate that the Employment Operations Office HR assistants should not be granted access to approve and release pay-related personnel actions to NFC. We will assess IRS's actions during our fiscal year 2017 financial statement audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish and implement procedures to periodically review the process for determining the intragovernmental costs and costs with the public for each major program reported in the notes to the financial statements to provide reasonable assurance that these amounts are reliable and fairly presented.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by February 2018, the CFO organization will establish and implement procedures to review periodically the process for determining intragovernmental and public costs for each major program reported in the notes to the financial statements, providing reasonable assurance that these amounts are reliable and presented fairly. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to provide clear guidelines as to what events constitute removal from IRS premises and the disposal date that should be recorded in its inventory system, either through an update of the IRM or other property and equipment-related desk guides.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS agreed with this recommendation. IRS stated that by December 2017, the AWSS organization will provide clear guidelines on events that constitute removal of trackable property and equipment assets from IRS premises, and the disposal date that should be recorded in its inventory system, either by updating the IRM or the property and equipment-related desk guides. We will follow-up during our audit of IRS's FY 2017 financial statements to determine the status of this recommendation.
    Director: Beryl H. Davis
    Phone: (202) 512-2623

    20 open recommendations
    including 12 priority recommendations
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Food, Nutrition, and Consumer Services to design policies and procedures to reasonably assure that all award recipients required to submit single audit reports do so in accordance with OMB guidance.

    Agency: Department of Agriculture
    Status: Open
    Priority recommendation

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Food, Nutrition, and Consumer Services did not comment on the recommendation directed to it. GAO believes the recommendation is valid as discussed in our report. In addition, Agriculture has not provided the 60 day letter in response to our recommendations. On July 27, 2017, the agency informed us that the delay is due to their response still needing to clear several approving offices. We have received no further status updates from Agriculture as to when we can expect to receive its 60 day letter. 31 U.S.C. 720 requires that the agency head submit a written statement of the actions taken by the agency on GAO's recommendations to selected congressional committees and GAO not later than 60 days after the date of our report.
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Food, Nutrition, and Consumer Services to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Agriculture
    Status: Open
    Priority recommendation

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Food, Nutrition, and Consumer Services did not comment on the recommendation directed to it. GAO believes the recommendation is valid as discussed in our report. In addition, Agriculture has not provided the 60 day letter in response to our recommendations. On July 27, 2017, the agency informed us that the delay is due to their response still needing to clear several approving offices. We have received no further status updates from Agriculture as to when we can expect to receive its 60 day letter. 31 U.S.C. 720 requires that the agency head submit a written statement of the actions taken by the agency on GAO's recommendations to selected congressional committees and GAO not later than 60 days after the date of our report.
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Food, Nutrition, and Consumer Services to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Agriculture
    Status: Open

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Food, Nutrition, and Consumer Services did not comment on the recommendation directed to it. GAO believes the recommendation is valid as discussed in our report. In addition, Agriculture has not provided the 60 day letter in response to our recommendations. On July 27, 2017, the agency informed us that the delay is due to their response still needing to clear several approving offices. We have received no further status updates from Agriculture as to when we can expect to receive its 60 day letter. 31 U.S.C. 720 requires that the agency head submit a written statement of the actions taken by the agency on GAO's recommendations to selected congressional committees and GAO not later than 60 days after the date of our report.
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Rural Development to design policies and procedures to reasonably assure that all award recipients required to submit single audit reports do so in accordance with OMB guidance.

    Agency: Department of Agriculture
    Status: Open
    Priority recommendation

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Rural Development (RD) concurred with this recommendation. An RD official stated that it will work with Agriculture's Office of the Chief Financial Officer and the program areas to develop policies and procedures to ensure that its award recipients are in compliance with Office of Management and Budget (OMB) guidance. RD stated that it will meet with each program area and discuss how single audits are processed and resolved. RD plans to develop policies and procedures for identifying all award recipients that should file single audit reports; determining if all required single audit reports are filed, received, and processed each year; and assuring that transmittal letters and management decisions contain the required elements and are issued timely in accordance with current OMB guidance. RD also stated that it will develop new policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach. We will assess these efforts once completed.
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Rural Development to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Agriculture
    Status: Open
    Priority recommendation

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Rural Development (RD) concurred with this recommendation. An RD official stated that it will work with Agriculture's Office of the Chief Financial Officer and the program areas to develop policies and procedures to ensure that its award recipients are in compliance with Office of Management and Budget (OMB) guidance. RD stated that it will meet with each program area and discuss how single audits are processed and resolved. RD plans to develop policies and procedures for identifying all award recipients that should file single audit reports; determining if all required single audit reports are filed, received, and processed each year; and assuring that transmittal letters and management decisions contain the required elements and are issued timely in accordance with current OMB guidance. RD also stated that it will develop new policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach. We will assess these efforts once completed.
    Recommendation: The Secretary of Agriculture should direct the Under Secretary for Rural Development to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Agriculture
    Status: Open

    Comments: The Department of Agriculture's (Agriculture) Under Secretary for Rural Development (RD) concurred with this recommendation. An RD official stated that it will work with Agriculture's Office of Chief Financial Officer and the program areas to develop policies and procedures to ensure that its award recipients are in compliance with Office of Management and Budget (OMB) guidance. RD stated that it will meet with each program area and discuss how single audits are processed and resolved. RD plans to develop policies and procedures for identifying all award recipients that should file single audit reports; determining if all required single audit reports are filed, received, and processed each year; and assuring that transmittal letters and management decisions contain the required elements and are issued timely in accordance with current OMB guidance. RD also stated that it will develop new policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach. We will assess these efforts once completed.
    Recommendation: The Secretary of Health and Human Services should direct the Assistant Secretary for Financial Resources to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Health and Human Services
    Status: Open
    Priority recommendation

    Comments: The Department of Health and Human Services (HHS) concurred with this recommendation to the Assistant Secretary for Financial Resources (ASFR). HHS stated that it will enhance the Grants Policy Administration Manual (issued on December 31, 2015) to provide additional details regarding the elements to be included in the management decisions letters. ASFR stated that it will use its established Single Audit Resolution Workgroup, comprised of representatives from the HHS agencies who are responsible for single audit resolution activities, to continually evaluate and strengthen its relevant policies and procedures. We will assess these efforts once completed.
    Recommendation: The Secretary of Health and Human Services should direct the Assistant Secretary for Financial Resources to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: The Department of Health and Human Services (HHS) concurred with this recommendations to the Assistant Secretary for Financial Resources (ASFR). HHS stated that it is committed to ensuring that grantees submit single audits in a timely and complete manner and that its subagencies utilize the findings to ensure proper management of its grantees. HHS stated that ASFR is taking over the single audit assignment and tracking function from the OIG and that this realignment will allow HHS to better meet the requirements of the Uniform Guidance. HHS stated that it would continue to evaluate its policies and procedures to ensure compliance with regulations, particularly as ASFR takes over the single audit findings assignment and tracking function from the OIG. In addition, HHS stated that ASFR will work to develop policies and procedures that utilize a risk-based approach for high-risk and recurring single audit findings. We will assess these efforts once completed.
    Recommendation: The Secretary of Health and Human Services should direct the Administrator of the Centers for Medicare and Medicaid Services to revise its policies and procedures to take action to obtain single audit reports when award recipients did not submit reports within the required time frames.

    Agency: Department of Health and Human Services
    Status: Open
    Priority recommendation

    Comments: The Department of Health and Human Services (HHS) concurred with this recommendation to the Centers for Medicare and Medicaid Services (CMS). HHS stated that CMS has developed a Standard Operating Procedure (SOP) based on the Grants Policy Administration Manual (GPAM) issued December 31, 2015. The SOP is currently under review and will be implemented after approval and signature by CMS leadership. The SOP includes provisions for following up with entities that have delinquent audits. We will assess these efforts once completed.
    Recommendation: The Secretary of Health and Human Services should direct the Administrator of the Centers for Medicare and Medicaid Services to revise its policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Health and Human Services
    Status: Open
    Priority recommendation

    Comments: The Department of Health and Human Services (HHS) concurred with this recommendation to the Centers for Medicare and Medicaid Services (CMS). HHS stated that it has developed a Standard Operating Procedure (SOP) based on the Grants Policy Administration Manual (GPAM) issued on December 31, 2015, and the draft Management Decision Letter (MDL) HHS guidelines document. In April 2017, HHS informed us that the SOP is under review and will be implemented after approval and signature by CMS leadership. The SOP includes management decision letter elements and the timely issuance of MDLs. We will assess these efforts once completed.
    Recommendation: The Secretary of Health and Human Services should direct the Administrator of the Centers for Medicare and Medicaid Services to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: The Department of Health and Human Services (HHS) concurred with this recommendation to CMS. HHS stated that CMS plans to update the 1982 Health Care Financing Administration Audit Resolution Manual and will work collaboratively with HHS to develop policies and procedures that utilize a risk-based approach for high-risk and recurring single audit findings. We will assess these efforts once completed.
    Recommendation: The Secretary of Housing and Urban Development should direct the Principal Deputy Assistant Secretary for the Office of Community Planning and Development to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Housing and Urban Development
    Status: Open
    Priority recommendation

    Comments: The Department of Housing and Urban Development's (HUD) Office of Community Planning and Development (CPD) disagreed with this recommendation, but we maintain that revisions to CPD's policies and procedures are warranted to help CPD comply with the Office of Management and Budget (OMB) guidance. CPD officials stated that it provided training on writing management decisions to all CPD field offices in March 2017 and plans to issue a reminder memorandum on management decisions to field offices. We will assess these efforts once completed.
    Recommendation: The Secretary of Housing and Urban Development should direct the Principal Deputy Assistant Secretary for the Office of Community Planning and Development to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In April 2017, the Department of Housing and Urban Development's (HUD) Office of Community Planning and Development (CPD) stated that it planned to produce appropriate policies and procedures for risk rating single audit findings by the end of fiscal year 2017. We will assess these efforts once completed.
    Recommendation: The Secretary of Housing and Urban Development should direct the Principal Deputy Assistant Secretary for the Office of Public and Indian Housing to revise policies to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Housing and Urban Development
    Status: Open
    Priority recommendation

    Comments: The Department of Housing and Urban Development's (HUD) Office of Public and Indian Housing developed policies and procedures and conducted training for field offices relating to management decisions. We reviewed these policies and procedures and noted that they did not contain all of the required elements in accordance with the Office of Management and Budget guidance relating to management decisions. HUD officials stated that they will review the policies and procures and revise, if needed, to address our concerns. We will assess these efforts once completed.
    Recommendation: The Secretary of Housing and Urban Development should direct the Principal Deputy Assistant Secretary for the Office of Public and Indian Housing to design and implement policies and procedures for identifying and managing high-risk and recurring single audit findings using a risk-based approach.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: The Department of Housing and Urban Development's (HUD) Office of Public and Indian Housing met with GAO on July 10, 2017, to discuss the status of this recommendation. The HUD officials at this meeting said the current language in their Independent Public Accountant (IPA) auditing standards addresses the GAO recommendation. However, we explained to the HUD officials at the meeting that the current language is insufficient to close the recommendation as it does not show evidence that HUD has designed or implemented policies and procedures for how HUD is identifying and managing high-risks. The HUD officials stated that they will give this recommendation more consideration and revise the standards and provide GAO with additional support to show what HUD has done to address this recommendation. We will assess these efforts once completed.
    Recommendation: The Secretary of Transportation should direct the Administrator of the Federal Highway Administration to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Transportation
    Status: Open
    Priority recommendation

    Comments: The Department of Transportation (DOT) agreed with this recommendation. DOT stated that it will, no later than December 31, 2017, instruct the Federal Highway Administration to design, revise, and implement procedures to comply with federal grant and financial management requirements by September 30, 2019. We will assess these efforts once completed.
    Recommendation: The Secretary of Transportation should direct the Administrator of the Federal Highway Administration to design and implement policies and procedures for identifying and managing recurring single audit findings using a risk-based approach.

    Agency: Department of Transportation
    Status: Open

    Comments: The Department of Transportation (DOT) agreed with this recommendation. DOT stated that it will, no later than December 31, 2017, instruct the Federal Highway Administration to design, revise, and implement procedures to comply with federal grant and financial management requirements by September 30, 2019. We will assess these efforts once completed.
    Recommendation: The Secretary of Transportation should direct the Administrator of the Federal Transit Administration to design policies and procedures to reasonably assure that all award recipients required to submit single audit reports do so in accordance with OMB guidance.

    Agency: Department of Transportation
    Status: Open
    Priority recommendation

    Comments: The Department of Transportation (DOT) agreed with this recommendation. DOT stated that it will, no later than December 31, 2017, instruct the Federal Transit Administration to design, revise, and implement procedures to comply with federal grant and financial management requirements by September 30, 2019. We will assess these efforts once completed. We will assess these efforts once completed.
    Recommendation: The Secretary of Transportation should direct the Administrator of the Federal Transit Administration to revise policies and procedures to reasonably assure that management decisions contain the required elements and are issued timely in accordance with OMB guidance.

    Agency: Department of Transportation
    Status: Open
    Priority recommendation

    Comments: The Department of Transportation (DOT) agreed with our recommendations. DOT stated that it will, no later than December 31, 2017, instruct the Federal Transit Administration to design, revise, and implement procedures to comply with federal grant and financial management requirements by September 30, 2019. We will assess these efforts once completed.
    Recommendation: The Secretary of Transportation should direct the Administrator of the Federal Transit Administration to design and implement policies and procedures for identifying and managing recurring single audit findings using a risk-based approach.

    Agency: Department of Transportation
    Status: Open

    Comments: The Department of Transportation (DOT) agreed with this recommendation. DOT stated that it will, no later than December 31, 2017, instruct the Federal Transit Administration to design, revise, and implement procedures to comply with federal grant and financial management requirements by September 30, 2019. We will assess these efforts once completed.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    8 open recommendations
    Recommendation: The Secretary of the Army should direct the Internal Review Directorate under the Assistant Secretary of the Army, Financial Management and Comptroller, to develop written policies and procedures for all financial management-related audit findings and recommendations under its purview that include the following: (1) how the status of the recommendations will be tracked; (2) the process and criteria to be followed for prioritizing the findings and recommendations; (3) the process for developing CAPs to remediate the findings and recommendations, including the detailed CAP elements recommended by the Implementation Guide for OMB Circular A-123; and (4) the process for monitoring the status and progress of the CAPs, including the documentation to be maintained for monitoring CAP status and any actions to be taken if a lack of progress is found.

    Agency: Department of Defense: Department of the Army
    Status: Open

    Comments: The Army concurred with this recommendation. The Army stated that the Internal Review Directorate has completed updating its written standard operating procedures to include monitoring financial management-related external audit findings and recommendations. The Army stated that this new guidance includes an explanation of how recommendations will be tracked; how findings and recommendations will be prioritized; how status and progress of corrective action plans (CAPs) will be developed; and how the status and progress of CAPs will be monitored.
    Recommendation: The Secretary of the Army should direct the Accountability and Audit Readiness Directorate under the Assistant Secretary of the Army, Financial Management and Comptroller, to enhance the directorate's policies and procedures for (1) tracking and prioritizing all financial management-related audit findings and recommendations under its purview and (2) developing and monitoring CAPs for all such recommendations so that they include sufficient details, such as the criteria used to prioritize the CAPs, the recommended CAP elements, and the process for monitoring and documenting the progress and status of CAPs.

    Agency: Department of Defense: Department of the Army
    Status: Open

    Comments: The Army concurred with this recommendation. The Army stated that the Accountability and Audit Readiness Directorate has completed actions to enhance its current standard operating procedures to include (1) updating its corrective action plan (CAP) database and reporting tool, (2) documenting its reporting procedures, and (3) updating its CAP template to include additional elements recommended by the Implementation Guide for OMB Circular A-123. In addition, the Army stated that its policies and procedures include steps to incorporate external financial management-related audit findings assigned to the Accountability and Audit Readiness Directorate by the Internal Review Directorate and that the existing process the Army uses to prioritize findings and the related CAPs and to monitor the progress and status of CAPs has been documented.
    Recommendation: The Secretary of the Navy should, when finalizing the Navy's policies and procedures for identifying and tracking its CAPs to remediate financial management-related audit findings and recommendations, enhance this guidance so it includes detailed steps and specific procedures for confirming and validating the completeness and accuracy of the status of these audit findings and recommendations.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation. The Navy stated that it is (1) recording new findings and recommendations on a weekly basis in its deficiency database, (2) reviewing historical audits to ensure that previous findings and recommendations are recorded, and (3) collaborating with audit agencies to establish a process to reconcile the status of recommendations to ensure that its deficiency database accurately reports open and closed recommendations. The Navy also stated that these processes would be documented and implemented by January 31, 2017.
    Recommendation: The Secretary of the Air Force should design and document a comprehensive process to ensure that the complete universe of all financial management-related findings and recommendations from all audit sources is identified and tracked.

    Agency: Department of Defense: Department of the Air Force
    Status: Open

    Comments: The Air Force concurred with this recommendation. The Air Force stated that it will revise its existing process for identifying and tracking all financial management-related findings and recommendations from all audit sources. The Air Force stated that the process will include the procedures for summarizing the status of findings on a bi-monthly basis and providing a summary for the FIAR Governance Board meetings. The Air Force stated that it plans to implement this recommendation by January 31, 2018.
    Recommendation: The Secretary of the Air Force should update the Air Force's written policies and procedures for prioritizing financial management-related audit findings and recommendations from all audit sources and for developing and monitoring CAPs so that they include sufficient details. These procedures should include the following details: (1) The process to be followed for prioritizing the financial management-related findings and recommendations from audit sources. (2) The guidance for developing CAPs for all financial management-related audit findings and recommendations from all audit sources to include complete details, including the elements recommended by the Implementation Guide for OMB Circular A-123. (3) The process for monitoring the status of the CAPs for all financial management-related audit findings and recommendations from all audit sources, including the documentation to support any corrective actions taken, as recommended by the Implementation Guide for OMB Circular A-123.

    Agency: Department of Defense: Department of the Air Force
    Status: Open

    Comments: The Air Force concurred with this recommendation. The Air Force stated that it will revise its existing written policies and procedures for tracking and monitoring all financial management-related audit findings and recommendations. Specifically, the Air Force stated the these revised policies and procedures will (1) articulate prioritizing findings and recommendations; (2) provide guidance for developing detailed and actionable corrective action plans (CAPs), which address the condition and root cause of the findings and include elements recommended by OMB Circular A-123; and (3) provide clear guidance for monitoring the status and progress towards implementing and closing the CAPs. The Air Force plans to implement this recommendation by January 31, 2019.
    Recommendation: To improve DOD management's process for monitoring the military services' audit remediation efforts and to provide timely and useful information to stakeholders as needed, the Secretary of Defense should direct the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force to prepare and submit to the Under Secretary of Defense (Comptroller), on at least a bimonthly basis for availability at the FIAR Governance Board meetings, a summary of key information included in the CAPs that at a minimum contains the data elements recommended by the Implementation Guide for OMB Circular A-123 for each CAP related to critical capabilities for achieving audit readiness.

    Agency: Department of Defense
    Status: Open

    Comments: DOD concurred with this recommendation. DOD stated that it solicits input on a bi-monthly basis, on critical capability corrective action plans (CAPs) at a summary level. This information is provided routinely at regularly scheduled FIAR Governance Board meetings. DOD also stated that an updated notice of finding and recommendation (NFR) form template is being developed and will be provided to the military services to use for reporting this information so that it will include the recommended standard data elements outlined in OMB Circular A-123 to provide greater transparency into the nature of remediation plans. DOD also stated that FIAR Guidance will be updated to explicitly state that military services should include the OMB recommended standard data elements in CAPs.
    Recommendation: To reasonably assure that DOD management and external stakeholders have a comprehensive picture of the status of corrective actions needed for audit readiness throughout the department, the Secretary of Defense should direct the Under Secretary of Defense (Comptroller) to prepare a consolidated CAP management summary on a bimonthly basis that includes the data elements referred to above on the status of all CAPs related to critical capabilities for the military services and for the service providers and other defense organizations.

    Agency: Department of Defense
    Status: Open

    Comments: DOD partially concurred with this recommendation. According to DOD, the military services already provide summary-level updates on their critical capability corrective action plans (CAPs) at FIAR Governance Board meetings. It also stated that the template that is used to present CAPs to the FIAR Governance Board meetings at the summary level has been updated to align CAPs to critical capabilities. DOD still needs to address how all of the data elements from the Implementation Guide for OMB Circular A-123 will be summarized or otherwise reported for all CAPs pertaining to critical capabilities across the Department. In addition, DOD stated that because the DOD Comptroller takes responsibility for maintaining, monitoring, and reporting on the status of CAPs for the service providers and other defense organizations and of DOD-wide issues, the Comptroller will also summarize this information. However, DOD has not clarified what information from the military services will be summarized.
    Recommendation: To facilitate the development of a consolidated CAP management summary and the ability to efficiently respond to stakeholder requests, the Under Secretary of Defense (Comptroller) should develop and implement a centralized monitoring and reporting process that at a minimum (1) captures department-wide information on the military services' and other defense organizations' CAPs related to critical capabilities, including the standard data elements recommended in the Implementation Guide for OMB Circular A-123, and (2) maintains up-to-date information on the status of these CAPs.

    Agency: Department of Defense: Under Secretary of Defense (Comptroller)
    Status: Open

    Comments: DOD partially concurred with this recommendation. DOD stated that as outlined in the military services' responses to our recommendations directed to them, the Army, Navy, and Air Force have agreed to take the responsibility for developing, maintaining, and monitoring all CAPs at the level recommended by the Implementation Guide for OMB Circular A-123. Further, DOD stated that based on the Comptroller actively participating in monthly meetings with military services to gain an understanding of their CAPs and the information reported in bi-monthly FIAR Governance Board meetings, this provides the Department the ability to efficiently respond to stakeholder requests related to critical capabilities CAPs. However, DOD did not describe a centralized reporting process to ensure consistent standard data elements are provided in CAPs and that the information on the status of the CAPs is up to date.
    Director: Michael Clements
    Phone: (202) 512-8678

    1 open recommendations
    Recommendation: To promote transparency and accountability of federal spending, the Commissioner of the Fiscal Service should make basic information about Fiscal Service's use of financial agents publicly available in a central location, including compensation paid to each financial agent under its financial agency agreement and a description of the services provided.

    Agency: Department of the Treasury: Bureau of the Fiscal Service
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: David C. Trimble
    Phone: (202) 512-3841

    1 open recommendations
    including 1 priority recommendation
    Recommendation: To help provide a roadmap to effectively guide NNSA's effort to integrate and improve its financial management, the NNSA Administrator should direct the Program Director of Financial Integration to develop a plan for producing cost information that fully incorporates leading practices.

    Agency: Department of Energy: National Nuclear Security Administration
    Status: Open
    Priority recommendation

    Comments: NNSA agreed with the recommendation. In its written responses to our report, NNSA stated that it will address the items we identified in its annual update to Congress on its financial integration initiative.
    Director: J. Lawrence Malenich
    Phone: (202) 512-3406

    1 open recommendations
    Recommendation: CCI's Chief Financial Officer should update its existing Procurement and Accounts Payable Policy to fully document CCI's management approval controls over payments made by check, including exemptions to regular procedures. This should include approval procedures to be followed during periods when only one authorized manager is available to sign checks for payment.

    Agency: Capital Concerts, Inc.
    Status: Open

    Comments: We provided a draft of this report to Capital Concerts, Inc. (CCI) for comment. In its written comments, CCI stated that its Board of Directors will take appropriate action to address this recommendation.
    Director: Beryl H. Davis
    Phone: (202) 512-2623

    9 open recommendations
    including 4 priority recommendations
    Recommendation: To provide agencies access to SSA's more complete set of death data, Congress should consider amending the Social Security Act to explicitly allow SSA to share its full death file with Treasury for use through the DNP working system.

    Agency: Congress
    Status: Open

    Comments: When we confirm what actions have been taken we will update. As of August 3, 2017, no updated information has been provided.
    Recommendation: To reasonably assure that additional relevant databases are identified and evaluated for inclusion in the DNP working system, the Director of OMB should develop, document, and communicate a formal process that user agencies can use to identify, suggest, and receive feedback on additional databases to be evaluated for inclusion in the DNP working system.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB agreed with this recommendation and cited plans to implement it. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To reasonably assure that the DNP working system is used effectively and consistently, the Director of OMB should develop guidance that clarifies whether the use of DNP's payment integration functionality is required and--if required--the circumstances and process in which agencies may obtain an exemption from this requirement.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB agreed with this recommendation and cited plans to implement it. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To reasonably assure that agencies use the DNP working system effectively, the Director of OMB should develop a strategy--and communicate its strategy through guidance--for how agencies should use the DNP working system to complement existing data matching processes and whether and how agencies should consider using the DNP working system to streamline existing data matching. Such guidance may cover how agencies should demonstrate that their data matching processes meet the requirements in the Improper Payments Elimination and Recovery Improvement Act of 2012, whether agencies can decide on their own which specific databases to use, and how agencies should use the functionalities available through the DNP working system.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB stated that it generally agreed with the concept of developing a strategy for how agencies should use the Do Not Pay (DNP) working system to complement existing data matching processes and would explore the concept further. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To reasonably assure that agencies develop consistent policies and procedures to verify DNP matches, the Director of OMB should provide additional guidance that outlines when and how agencies should verify DNP matches against a secondary source and provide individuals an opportunity to contest before taking adverse actions as a result of DNP matches.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB stated that it agreed with the of consistent policies and procedures and will work with agencies so that their policies and procedures for verifying Do Not Pay (DNP) matches are developed consistently. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To better monitor agency use of the DNP working system once a strategy has been developed, the Director of OMB should develop and implement monitoring mechanisms--such as goals, benchmarks, and performance measures--to evaluate agency use of the DNP working system.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB stated that it agreed with the concept of monitoring mechanisms and will continue to work with agencies to reduce improper payments and encourage agencies to establish goals to improve payment accuracy that will be monitored and evaluated by OMB. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To reasonably assure that agency-reported information on use of the DNP working system is reliable, the Director of OMB should develop a process for comparing agency reporting on the use of the DNP working system to available sources, such as OMB guidance and DNP working system adjudication reports.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB stated that it agreed with the concept of ensuring that data are reliable and will consider the feasibility of a process to compare agency submissions to available sources to reasonably assure that agency-reported information on use of the Do Not Pay (DNP) working system is reliable. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: To reasonably assure that agency-reported information on use of the DNP working system is complete, the Director of OMB should revise its guidance to clarify whether agencies should report on their uses of all of the functionalities of the DNP working system in their agency financial reports.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: We provided a draft of this report to OMB and Treasury and other agencies we reviewed for comment. In its written comments, OMB stated that it agreed with ensuring the completeness of data and will continue to work with agencies and the Chief Financial Officer community to ensure that agency-reported information on the use of the Do Not Pay (DNP) working system is complete. As of August 3, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Recommendation: The Secretary of the Treasury should modify the DNP working system to track adjudication of matches obtained through all functionalities.

    Agency: Department of the Treasury
    Status: Open

    Comments: In a memo dated April 13, 2017, the Department of Treasury (Treasury) stated that it is in the process of evaluating potential solutions to capture information on the impact of Portal functionalities (online single search, continuous monitoring, and batch matching), and has developed a plan with timeframes to assess the technical feasibility as well as user willingness to provide information. However, Treasury stated that it cannot be certain that this evaluation will identify viable solutions, and therefore cannot commit to making any modifications to the working system. Treasury explained, for instance, it may not be possible to design an effective and user-friendly strategy to capture agency decisions to remove an excluded party identified in a continuous monitoring file from a list of approved vendors. Further, Treasury explained that even if it can capture those decisions, it may be even more difficult to assign a dollar value to that decision as there would be no payment pending in this example. Nevertheless, Treasury stated that it is committed to thoroughly evaluating whether a solution is possible, and--if a solution proves feasibly--its goal is to complete a development plan for the implementation of any identified solutions by September 30, 2018.
    Director: Cary Russell
    Phone: (202) 512-5431

    2 open recommendations
    Recommendation: In order to improve the accuracy of the information included in the operation and maintenance (O&M) budget justification material submitted to Congress and provide complete information to review the military services' fuel consumption spending requests, the Secretary of Defense should direct the Under Secretary of Defense (Comptroller), in consultation with the military services and DLA, to develop an approach to reconcile data on fuel consumption reported by the military services and fuel sales to the military services reported by DLA and take any appropriate corrective actions to improve the accuracy of actual fuel consumption spending data.

    Agency: Department of Defense
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: In order to improve the accuracy of the information included in the O&M budget justification material submitted to Congress and provide complete information to review the military services' fuel consumption spending requests, the Secretary of Defense should direct the Under Secretary of Defense (Comptroller), in consultation with the military services and DLA, to report complete fuel consumption information to Congress, to include actual and estimated fuel volume and actual O&M base obligations for fuel consumption spending separate from O&M Overseas Contingency Operations obligations. This information could be provided as part of DOD's annual O&M budget justification materials, or through other reporting mechanisms.

    Agency: Department of Defense
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    7 open recommendations
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to prepare a level I quantitative drilldown in accordance with the FIAR Guidance.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to prepare a quantitative drilldown. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to prioritize audit readiness efforts for the key FBWT systems, prepare an audit strategy that identifies for each system (1) the Navy's plan for assessing the system to gain assurance that the system can be relied on; (2) the assessment types, including prioritizing the assessments based on qualitative and quantitative factors for each system; and (3) planned start and completion dates of these assessments for each system.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to prioritize audit readiness efforts for key FBWT systems. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to prepare, in accordance with FIAR Guidance, the documentation of control activities and information technology general computer controls for significant systems; system certifications or accreditations; system, end user, and systems documentation locations; and hardware, software, and interfaces.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to document control activities, information technology general computer controls for significant systems, systems documentation locations, and hardware, software, and interfaces. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to prepare an internal control assessment document for each assessable unit, summarizing control activities that are appropriately designed and in place.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to prepare an internal control assessment document. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to perform sufficient testing for supporting documentation to reasonably determine whether such documentation, including that for key reconciliations, is available in a sustainable manner for future audit efforts.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to test the effectiveness of Fund Balance with Treasury controls, which includes assessing the availability of supporting documentation. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to, for each fiscal year expected to be under audit, identify and address unusual and invalid transactions, abnormal balances, and missing data fields in the universe of collection and disbursement transactions.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendation and stated that it has actions planned, taken, or under way to obtain monthly data from Defense Finance and Accounting Service on invalid Fund Balance with Treasury transactions. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Recommendation: To improve the Navy's implementation of the FIAR Guidance for its General Fund FBWT FIP and facilitate efforts to achieve SBR auditability, the Secretary of the Navy should direct the Assistant Secretary of the Navy, Financial Management and Comptroller, to update FBWT data flowcharts and narratives to fully describe the flow of data from the Navy's receipt of collection and disbursement transaction information through the financial statement line items, including the reversal of general ledger trial balance data generated by the automated system and other entries made within Defense Departmental Reporting System - Budgetary.

    Agency: Department of Defense: Department of the Navy
    Status: Open

    Comments: The Navy concurred with this recommendations and stated that it has actions planned, taken, or under way to develop procedures and documentation that describe the processes associated with the flow of data. In August 2017 we contacted the Navy POC and requested an update on the status of this recommendation.
    Director: Andrew Von Ah
    Phone: (213) 830-1011

    1 open recommendations
    Recommendation: To ensure that Congress will have more complete information on DOD's full funding needs for its O&M base budget and to conduct oversight of DOD's use of OCO funds to support base programs and activities, the Secretary of Defense should direct the Office of the Under Secretary of Defense Comptroller to revise its guidance on preparing budget justification materials and execution reports for Congress to require the addition of O&M obligations used for base programs and activities at the level of information presented for each account.

    Agency: Department of Defense
    Status: Open

    Comments: DOD continues to non-concur with our recommendation; however, we continue to believe that the recommendation is valid and will follow up annually on the status of the recommendation.
    Director: Valerie Melvin
    Phone: (202) 512-6304

    4 open recommendations
    Recommendation: To address weaknesses in the department's financial management systems modernization efforts, the Secretary of HUD should direct the Chief Financial Officer to work with the Chief Information Officer in managing subsequent initiatives to define a high-level depiction of the IT systems anticipated in the future state, a description of the operations that must be performed and who must perform them, and an explanation of where and how the operations are to be carried out.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In its comments on our draft report, HUD neither agreed nor disagreed with our recommendations, but noted that it planned to improve management practices and IT governance for future modernization efforts. In May 2017, HUD's Deputy Chief Information Officer reported that that the office was managing multiple enterprise-level initiatives no longer classified as financial management modernization efforts, but which are intended to address certain previously reported financial systems modernization needs. The department provided early high-level requirements and a solution architecture for one such initiative, including a future requirement to support data required for HUD's financial reporting needs from Treasury. However, HUD does not yet have a plan to develop a high-level concept of operations for IT systems anticipated in the future state. We intend to follow up on HUD's actions.
    Recommendation: To address weaknesses in the department's financial management systems modernization efforts, the Secretary of HUD should direct the Chief Financial Officer to work with the Chief Information Officer in managing subsequent initiatives to develop comprehensive plans for scope, schedule and cost.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In its comments on our draft report, HUD neither agreed nor disagreed with our recommendations, but noted that it planned to improve management practices and IT governance for future modernization efforts. In May 2017, the department provided an early project oversight plan and critical task schedule for one initiative related to enterprise data management, but these plans are not comprehensive and do not include, among other things, detailed cost estimates. We intend to follow up on HUD's actions.
    Recommendation: To address weaknesses in the department's financial management systems modernization efforts, the Secretary of HUD should direct the Chief Financial Officer to work with the Chief Information Officer in managing subsequent initiatives to ensure requirements are fully documented and traceable.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In its comments on our draft report, HUD neither agreed nor disagreed with our recommendations, but noted that it planned to improve management practices and IT governance for future modernization efforts. In March 2017, the department reported that the Chief Financial Officer and the Chief Information Officer intend to partner on future departmental financial management systems modernization efforts to fully document requirements and trace requirements to the functionality in the modernized system. In May 2017, department officials reported that the subsequent initiatives underway were following an Agile process yielding product-release backlogs as documentation of requirements for ongoing initiatives. They provided the initial backlog for an enterprise data management initiative. However, HUD could not demonstrate that these requirements were complete and traceable to mission needs. We intend to follow up on HUD's actions.
    Recommendation: The Secretary of HUD should also direct the Deputy Secretary to ensure that the Chief Information Officer takes action to improve IT governance control activities used for monitoring programs and identifying needed corrective actions, and strengthen investment oversight by improving coordination with stakeholders and alignment among IT modernization efforts.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: In its comments on our draft report, HUD neither agreed nor disagreed with our recommendations, but noted that it planned to improve management practices and IT governance for future modernization efforts. In March 2017, the department reported on its fiscal year 2016 updates to charters of its IT governance boards, which provide oversight of all its IT investments, including financial management initiatives, and noted that business cases for proposed development and modernization initiatives had been discussed at governance meetings. HUD also reported that it had set up steering committees to supplement board governance and monitoring two enterprise-level modernization efforts and planned to apply mechanisms, such as project health assessments, intended to establish effective investment oversight. However, HUD has not yet demonstrated that the updated governance control activities have improved program monitoring and identified any needed corrective actions or that planned oversight mechanisms have improved coordination with stakeholders or alignment of modernization efforts. We intend to follow up on HUD's actions to ensure that planned improvements to governance and oversight mechanisms are effectively implemented and institutionalized.
    Director: Garcia-diaz, Daniel
    Phone: (202) 512-8678

    5 open recommendations
    Recommendation: In order to more fully implement key practices and meet requirements and to better institutionalize standards and practices, the Secretary of HUD should clearly link HUD's strategic goals and objectives with federal priority goals in the next annual performance plan.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information
    Recommendation: In order to more fully implement key practices and meet requirements and to better institutionalize standards and practices, the Secretary of HUD should describe the reasons that goals were not met and HUD's plans for achieving them in the next annual performance report.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information
    Recommendation: In order to more fully implement key practices and meet requirements and to better institutionalize standards and practices, the Secretary of HUD should establish a process and schedule for regularly reviewing, revising, and updating HUD's human capital strategic plan, strategic workforce plan, and succession plan.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information
    Recommendation: In order to more fully implement key practices and meet requirements and to better institutionalize standards and practices, the Secretary of HUD should establish a process and schedule for reviewing and updating policies and procedures to help ensure that policies and procedures for key management functions remain current and complete.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information
    Recommendation: In order to more fully implement key practices and meet requirements and to better institutionalize standards and practices, the Secretary of HUD should formalize lines of communication between the Chief Information Officer and the agency head, consistent with OMB guidance and internal control standards.

    Agency: Department of Housing and Urban Development
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information
    Director: Dawn B. Simpson
    Phone: (202) 512-3406

    1 open recommendations
    including 1 priority recommendation
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary to develop and implement procedures to determine whether user accounts already exist before establishing or recertifying user accounts in the Governmentwide Treasury Account Symbol Adjusted Trial Balance System or Governmentwide Financial Report System.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury agreed that this recommendation remained open. Treasury plans to implement processes to validate new users who do not already have an existing account in the Governmentwide Treasury Account Symbol Adjusted Trial Balance System (GTAS) or the Governmentwide Financial Report System (GFRS); and to ensure that users do not have conflicting roles or privileges. We will follow-up on progress made by Treasury as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Director: Beryl Davis
    Phone: (202) 512-2623

    2 open recommendations
    Recommendation: To help fulfill the IPERA and OMB requirements to submit proposals to Congress when agencies reach 3 or more consecutive years of noncompliance with IPERA criteria, the Secretary of Agriculture or a designee should submit a letter to Congress detailing proposals for reauthorization or statutory changes in response to 3 consecutive years of noncompliance as of fiscal year 2014 for its (1) Child and Adult Care Food Program; (2) School Breakfast Program; (3) National School Lunch Program; and (4) Special Supplemental Nutrition Program for Women, Infants, and Children. To the extent that reauthorization or statutory changes are not considered necessary to bring a program into compliance, the Secretary or designee should state so in the letter.

    Agency: Department of Agriculture
    Status: Open

    Comments: We provided a draft of this report to OMB, the IG offices of the 24 CFO Act agencies, and the CFO offices of those agencies with programs that were determined to be noncompliant with IPERA criteria for 3 consecutive years as of fiscal year 2014. In their e-mailed response, officials from the CFO office at USDA neither concurred nor disagreed with our recommendations. We will continue to monitor the status of this recommendation.
    Recommendation: To help fulfill the IPERA and OMB requirements to submit proposals to Congress when agencies reach 3 or more consecutive years of noncompliance with IPERA criteria, the Secretary of Defense or a designee should submit a letter to Congress detailing proposals for reauthorization or statutory changes in response to 3 consecutive years of noncompliance as of fiscal year 2014 for its Department of Defense Travel Pay program. To the extent that reauthorization or statutory changes are not considered necessary to bring the program into compliance, the Secretary or designee should state so in the letter.

    Agency: Department of Defense
    Status: Open

    Comments: We provided a draft of this report to OMB, the IG offices of the 24 CFO Act agencies, and the CFO offices of those agencies with programs that were determined to be noncompliant with IPERA criteria for 3 consecutive years as of fiscal year 2014. In their written comments, the offices of the DOD CFO and DOD IG concurred with our recommendations. The DOD CFO office noted that it does not consider reauthorization or statutory change necessary for its Travel Pay program, but will submit a letter to Congress containing planned actions for improvement by August 30, 2016. As of June 2, 2017, no updated information has been provided by the Department of Defense. We will continue to monitor the status of this recommendation.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    1 open recommendations
    Recommendation: To improve budgeting and management of carryover, the Secretary of Defense should direct the Secretary of the Army to direct the Army Materiel Command to incorporate in its regulation provisions for a repair process that includes upfront communication and coordination among AMC and non-AMC stakeholders that will result in the development of a well-defined scope of work and parts needed by the Industrial Operations activities to perform the repair work that will help reduce carryover.

    Agency: Department of Defense
    Status: Open

    Comments: DOD stated that the Army will enforce policy and business rules that require Organic Industrial Base facilities to communicate with their customers early to verify the scope of work and ensure that the Army has the required capability, capacity, equipment, and parts needed to meet delivery schedules and avoid excessive carryover. DOD also stated that it will update its policy and publish its draft regulation during fiscal year 2017.
    Director: J. Christopher Mihm
    Phone: (202) 512-6806

    13 open recommendations
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Agriculture should describe the Department of Agriculture's (USDA) major management challenges and include performance goals, performance measures, milestones and an agency official responsible for resolving each of its major management challenges as part of USDA's agency performance plan.

    Agency: Department of Agriculture
    Status: Open

    Comments: As of August 2017, USDA had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Commerce should describe the Department of Commerce's major management challenges and include performance goals, performance measures, milestones and an agency official responsible for resolving each of its major management challenges as part of the Department of Commerce's agency performance plan.

    Agency: Department of Commerce
    Status: Open

    Comments: According to the Department of Commerce' action plan to address GAO's recommendations, it will begin including a description of the Department's major management challenges, as well as related performance goals, performance milestones and an agency official responsible for resolving each of its major management challenges, in the Department's annual performance plan reporting, starting with the report to be issued concurrent with final fiscal year 2018 Congressional Budget Justifications (CBJ). As of August 2017, Commerce has not taken action to implement our recommendation. Our review of the Department of Commerce's 2018 CBJ found that it did not include recommended information. When the 2019 CBJ is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Defense should include planned actions for each of the Department of Defense's (DOD) major management challenges and ensure that required information about its major management challenges, currently in DOD's Agency Strategic Plan for Fiscal Years 2015-2018, be included in its agency performance plan so that progress toward resolving each of its major management challenges is transparent and reported annually.

    Agency: Department of Defense
    Status: Open

    Comments: As of August 2017, the Department of Defense had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Energy should describe the Department of Energy's major management challenges and include performance goals, performance measures, milestones and an agency official responsible for resolving each of its major management challenges as part of the Department of Energy's agency performance plan.

    Agency: Department of Energy
    Status: Open

    Comments: As of August 2017, the Department of Energy had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Attorney General should describe the Department of Justice's major management challenges and include performance goals, performance measures, milestones, planned actions and an agency official responsible for resolving each of its major management challenges as part of the Department of Justice's agency performance plan.

    Agency: Department of Justice
    Status: Open

    Comments: According to the Department of Justice's action plan to address GAO's recommendations, it will report the Office of Inspector General Top Management Challenges in both the Annual Financial Report (AFR) and the Annual Performance Report(APR)/Annual Performance Plan(APP). For the APR/APP, the Department of Justice will also include the appropriate performance goals, performance measures, milestones, planned actions addressing the challenges and the name(s) of agency official(s) responsible for resolving each of its major management challenges. As of August 2017, however, the Department of Justice had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Labor should describe the Department of Labor's major management challenges and include performance goals, performance measures, milestones, planned actions, and an agency official responsible for resolving each of its major management challenges as part of the Department of Labor's agency performance plan.

    Agency: Department of Labor
    Status: Open

    Comments: According to the Department of Labor's action plan to address GAO's recommendations, it will comply with the updated Circular A-11 guidance to report on major management challenges in its next Annual Performance Report (APR), published with the FY 2018 Congressional Budget Justification. In its most recent APR, the Department of Labor took steps to implement this recommendation by including planned actions and an agency official responsible for each of the three issues it identified as a major management challenge. Further action is needed to establish performance goals, performance measures, and milestones. When the Fiscal Year 2017 APR is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Transportation should describe the Department of Transportation's major management challenges and include performance goals, performance measures, milestones, planned actions and an agency official responsible for resolving major management challenges as part of the Department of Transportation's agency performance plan.

    Agency: Department of Transportation
    Status: Open

    Comments: As of August 2017, the Department of Transportation had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of the Treasury should include performance goals, performance measures, milestones, and an agency official responsible for resolving major management challenges as part of the Department of the Treasury's agency performance plan.

    Agency: Department of the Treasury
    Status: Open

    Comments: As of August 2017, Treasury had not taken any actions to implement our recommendation. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Administrator of the Environmental Protection Agency (EPA) should include performance goals, performance measures, milestones, planned actions and an agency official responsible for resolving each of its major management challenges as part of EPA's agency performance plan.

    Agency: Environmental Protection Agency
    Status: Open

    Comments: In its Fiscal Year 2018 APP, EPA took steps to implement this recommendation by clearly identifying its major management challenges and including planned actions for resolving them. Further action is needed to establish performance goals, performance measures, milestones, and identify an agency official responsible for resolving the challenge. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Administrator of the General Services Administration (GSA) should describe GSA's major management challenges and include performance goals, performance measures, milestones and an agency official responsible for resolving each of its major management challenges as part of GSA's agency performance plan.

    Agency: General Services Administration
    Status: Open

    Comments: In its Fiscal Year 2018 APP, GSA took steps to implement this recommendation by clearly identifying three major management challenges and including planned actions, performance measures, milestones, and an agency official responsible for resolving them. Further action is needed to establish performance goals. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of Health and Human Services (HHS) should include performance goals, milestones and an agency official responsible for resolving each of HHS's major management challenges as part of HHS's agency performance plan.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: According to its website, for fiscal year 2018, HHS is meeting its performance reporting requirements as designated in the GPRA Modernization Act of 2010 and OMB Circular A-11 through the program performance information provided in the FY 2018 HHS Budget Justifications to Congress. As of August 2017, however, HHS has not taken action to implement our recommendation. Our review of HHS' 2018 Congressional Budget Justification found that it did not include recommended information. When the 2019 CBJ is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Secretary of the Interior should describe the Department of Interior's major management challenges and include performance goals, performance measures, planned actions, milestones and an agency official responsible for resolving each of its major management challenges as part of the Department of the Interior's agency performance plan.

    Agency: Department of the Interior
    Status: Open

    Comments: As of August 2017, the Department of Interior had not taken any actions to implement our recommendation. It is unclear in the APP what Interior considers to be its major management challenges and, if there are such issues, which performance information aligns with resolving those issues. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Recommendation: To improve the public reporting of major management challenges and to ensure performance information is useful, transparent, and complete, the Director of the National Science Foundation (NSF) should describe NSF's major management challenges and identify performance goals, performance measures, milestones, and an agency official responsible for resolving each of its major management challenges as part of NSF's agency performance plan.

    Agency: National Science Foundation
    Status: Open

    Comments: In its Fiscal Year 2018 APP, NSF took steps to implement this recommendation by clearly identifying its major management challenges and including planned actions for resolving them. Further action is needed to establish performance goals, performance measures, milestones, and identify an agency official responsible for resolving the challenge. When the 2019 annual performance plan is issued, we will update the status of this recommendation.
    Director: William J. Cordrey
    Phone: (404) 679-1873

    2 open recommendations
    Recommendation: To help provide better visibility of DOD's financial management status for decision makers and to improve oversight of DOD's audit readiness efforts to strengthen internal controls and improve financial practices and processes, the Under Secretary of Defense (Comptroller) should, while developing other formatting changes to be made in future reports, expand the semiannual FIAR Plan Status Report to include the extent to which assertions of audit readiness have been made without assurance that related controls are effective and the details of remediation activities taken and planned to correct the known internal control deficiencies.

    Agency: Department of Defense: Under Secretary of Defense (Comptroller)
    Status: Open

    Comments: DOD concurred with this recommendation and stated that its future FIAR Plan Status Reports will provide an increased level of detail regarding critical aspects of achieving audit readiness. DOD further stated that it would use the recommendation to develop and, where appropriate, enhance future semiannual Status Reports to include greater visibility into the progress and impediments related to PP&E audit readiness. Specifically, DOD stated that the Office of the Under Secretary of Defense (Comptroller) will work with the military departments to ensure that their audit readiness plans include specific milestones for addressing internal control deficiencies. The Comptroller expects completion by the November 2017 FIAR report. We will continue to evaluate DOD's actions to address this recommendation.
    Recommendation: To help provide better visibility of DOD's financial management status for decision makers and to improve oversight of DOD's audit readiness efforts to strengthen internal controls and improve financial practices and processes, the Under Secretary of Defense (Comptroller) should, while developing other formatting changes to be made in future reports, expand the semiannual FIAR Plan Status Report to include the details of military services' actions taken and progress made toward correcting the control deficiencies underlying the reported dealbreakers.

    Agency: Department of Defense: Under Secretary of Defense (Comptroller)
    Status: Open

    Comments: DOD concurred with this recommendation and stated that its future FIAR Plan Status Reports will provide an increased level of detail regarding critical aspects of achieving audit readiness. DOD further stated that it would use the recommendation to develop and, where appropriate, enhance future semiannual Status Reports to include greater visibility into the progress and impediments related to PP&E audit readiness. Specifically, DOD stated that the Office of the Under Secretary of Defense (Comptroller) will work with the military departments to ensure that their audit readiness plans include specific milestones for addressing internal control deficiencies. The Comptroller expects completion by the November 2017 FIAR report. We will continue to evaluate DOD's actions to address this recommendation.
    Director: Clark, Cheryl E
    Phone: (202) 512-9377

    12 open recommendations
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish a process to prevent Employment Operations staff from allowing potential employees to enter on duty without favorable determinations of suitability by Personnel Security adjudicators.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In December 2015, the HCO developed a process and revised procedures in an attempt to improve the monitoring of Employment Operations office decisions to reasonably assure that new employees do not enter on duty before prescreening adjudications are completed and approved by Personnel Security adjudicators. However, during our fiscal year 2016 audit, we identified IRS employees who entered on duty without completed or approved suitability adjudication determinations. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish a policy and procedures requiring IRS officials to review and address situations in which it is later discovered that an employee deemed unsuitable for employment during the prescreening process was erroneously allowed to enter on duty.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: While IRS responded that it established a policy and procedures, it did not provide documentation to sufficiently demonstrate that the policy and procedures were implemented. During our fiscal year 2016 audit, we identified an instance where an employee was allowed to enter on duty and it was subsequently discovered that this employee was deemed unsuitable for employment during the prescreening process. IRS did not provide additional documentation to demonstrate that its procedures had been carried out for this employee. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to develop and provide training, on a recurring basis, to all Facilities Management and Security Services specialists and managers involved in the duress alarm validation and testing process to reinforce the related policies and procedures.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: According to IRS, in February 2016, AWSS developed and provided training on duress alarm validation and testing to FMSS specialists and managers. However, during our June 2016 field office audit testing, we found that the FMSS specialists responsible for the physical security at the sites we visited had not received training on duress alarm validation and testing. Further, our testing identified instances where (1) duress alarm testing did not include all duress alarms, (2) documented validations of the duress alarm inventory were not completed timely or available to individuals (FMSS and non-FMSS staff) before each test was conducted, and (3) descriptions of the duress alarm inventory used by the security specialist to conduct testing were labeled incorrectly. During follow up discussions with IRS officials, we were informed that FMSS specialists were not fully evaluating alarm test results and adhering to established procedures for monitoring those tests. We will continue to evaluate IRS's efforts to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish and implement a policy requiring recurring training for TAC group and territory managers on their TSRRD responsibilities, including detailed instructions for completing responses to questions in TSRRD and for reviewing TSRRD submissions for accuracy and completeness. This training should be updated for changes in TSRRD questions over time and be provided to new TAC group and territory managers soon after they are hired or appointed.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS efforts to address this recommendation are ongoing. IRS stated that during fiscal year 2017, the Wage and Investment organization will incorporate into the IRM its new training policy requiring training for TAC group and territory managers on their TSRRD responsibilities, including specific instructions for completing questions in TSRRD and for reviewing TSRRD submissions. According to IRS, this training will be provided on a recurring basis to account for changes in TSRRD questions and newly hired or appointed TAC group and territory managers. As these actions occurred after the end of fiscal year 2016, we will evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to determine the reason(s) why staff did not always comply with IRS's established policies and procedures related to initiating, monitoring, and reviewing the monitoring of manual refunds and, based on this determination, establish a process to better enforce compliance with these requirements.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS efforts to address this recommendation are ongoing. IRS stated that by September 2017, it will determine the reasons for staff noncompliance with established policies and procedures related to initiating, monitoring, and reviewing the monitoring of manual refunds, and based on this determination, establish a process to better enforce compliance with these requirements. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to enhance the training program provided to COs to address all the job responsibilities related to certifying manual refunds for payment, including the required review of supporting documentation for manual refunds.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS stated that in February 2016, it provided a refresher course to COs as part of their annual training to address their responsibilities related to certifying manual refunds. However, based on our review of the refresher course materials, the course did not address our recommendation to enhance the training program. For example, the materials did not provide guidelines on how to perform the required reviews related to certifying manual refunds. As a result, during our fiscal year 2016 audit, we continued to find instances where the COs did not comply with the review requirements. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to identify the cause of and implement a solution for dealing with the periodic backlogs of ICO inventory that is hampering the performance of quality reviews.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS efforts to address this recommendation are ongoing. IRS stated that by September 2017, it will identify a cause of and implement a solution for dealing with the periodic backlogs of ICO inventory. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish policies for (1) how long an asset can remain in missing status before it is removed from P&E reported on the financial statements and (2) how long assets can go unverified during the annual inventory process before they are identified as missing in the property management system.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS's IT organization issued AM064, Asset Management Policy Directive to Identify Uncertified Class A and Class B Assets as Missing in KISAM, effective October 1, 2016. The directive states that in accordance with the annual Hardware Asset Management Inventory Certification Plan, assets that are not verified or certified for more than two inventory cycles should be identified as missing in IRS's property management system. It further states that the property management system should be updated by the end of the first quarter of the fiscal year after an asset meets the "missing" criterion. In November 2016, IRS's CFO organization developed the Missing Assets Financial Reporting Assessment procedure, which states that assets in missing status for 1 year or more should be removed from the P&E reported on IRS's financial statements. As these actions occurred after the end of fiscal year 2016, we will evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish and implement procedures to reasonably assure that missing assets are timely removed from the financial statements when applicable.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In November 2016, IRS's CFO organization established the Missing Assets Financial Reporting Assessment procedure, which included procedures for identifying assets that have been in missing status in the property management system for 1 year or more and removing them from the P&E reported on the financial statements. As this procedure was established after the end of fiscal year 2016, we will evaluate IRS's implementation of this procedure during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate officials to establish and implement monitoring procedures designed to reasonably assure that the key detailed information for tangible capitalized P&E is properly recorded and updated in the KISAM system.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS's IT organization established SOP FY17-01, Asset Management Program Monitoring and Review, effective October 1, 2016. The SOP details the IRS Asset Management Group's procedures for conducting a quarterly review on a sample of asset records and transactions in KISAM to verify the accuracy and completeness of key KISAM data elements and correct any discrepancies found. In September 2016, IRS issued AWSS-01-0916-0001, Interim Guidance for IRM 1.14.4, Personal Property Management, to require the FMSS territory manager or section chief to perform quarterly sample reviews of non-IT assets in KISAM to verify that key data elements are complete and updated. As these procedures were established after we conducted our internal control testing in fiscal year 2016, we will evaluate IRS's implementation of these procedures during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate officials to design a process to reasonably assure the adequacy of detailed supporting information for tangible P&E amounts recorded in the general ledger.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS's actions to address this recommendation are ongoing. According to IRS, by September 2017, its CFO organization will implement a P&E subsidiary ledger, and will design and implement processes based on the subsidiary ledger that will reasonably assure the adequacy of detailed supporting information for tangible P&E amounts recorded in the general ledger. We will assess IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The IRS Commissioner should direct the appropriate IRS officials to establish and implement detailed written procedures for calculating future lease payments for noncancelable operating leases that are reported in the notes to the financial statements. The procedures should (1) include steps for considering any ad hoc clauses that may have specific termination dates and (2) include a requirement for supervisory review to provide reasonable assurance of the accuracy of future lease payment amounts for noncancelable operating leases.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In October 2016, IRS established procedures for calculating future lease payments for noncancelable operating leases that are reported in the notes to its financial statements. The procedures included (1) steps for considering any ad hoc clauses that may have specific termination dates and (2) a requirement for supervisor review to provide reasonable assurance of the accuracy of future lease payment amounts for noncancelable operating leases. As these actions occurred after the end of fiscal year 2016, we will evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Director: Heather Krause
    Phone: (202) 512-6806

    5 open recommendations
    Recommendation: To help enhance efforts to expand shared services and improve the management of the Administrative Services Franchise Fund (ASFF), the Secretary of Transportation should direct the FAA Administrator to make pricing information, such as ranges of prices, for the ASFF's lines of business publicly available, as appropriate, to help potential customers and agency decision makers understand prices and different choices of services.

    Agency: Department of Transportation
    Status: Open

    Comments: FAA concurred with the recommendation. According to FAA, representatives from FAA's Administrative Services Franchise Fund are serving on the Office of Management and Budget's Shared Services Governance Board--a decision-making body for government-wide shared services initiatives. The Board is working with the General Services Administration's Unified Shared Services Management office on the standardization of publicly available pricing information for the FAA fund and other funds across the government and the forum in which to publish such information. FAA expects to provide an update on how it is addressing this recommendation by November 30, 2017.
    Recommendation: To help enhance efforts to expand shared services and improve the management of the ASFF, the Secretary of Transportation should direct the FAA Administrator to make the ASFF's strategic goals and performance metrics publicly available to help potential customers and agency decision makers understand how the fund is performing on the services provided.

    Agency: Department of Transportation
    Status: Open

    Comments: FAA concurred with the recommendation. According to FAA, representatives from FAA's Administrative Services Franchise Fund are serving on the Office of Management and Budget's Shared Services Governance Board--a decision-making body for government-wide shared services initiatives. The Board is working with the General Services Administration's Unified Shared Services Management office on the standardization of performance metrics for shared service providers (including the FAA fund) and the forum on which to publically share such information. FAA expects to provide an update on how it is addressing this recommendation by November 30, 2017.
    Recommendation: To help enhance efforts to expand shared services and improve the management of the Treasury Franchise Fund (TFF), the Secretary of the Treasury should make pricing information, such as ranges of prices, for the Administrative Resource Center Information Technology Services and Shared Services Programs (SSP) lines of business publicly available, as appropriate, to help potential customers and agency decision makers understand prices and different choices of services.

    Agency: Department of the Treasury
    Status: Open

    Comments: Treasury concurred with the recommendation. In March 2017, GAO contacted Treasury for a status update on how the recommendation is being addressed. We will update the status when the update is received.
    Recommendation: To help enhance efforts to expand shared services and improve the management of the TFF, the Secretary of the Treasury should develop a more complete set of performance metrics for the TFF's SSP line of business to help managers of the SSP line of business, current and potential customers, and agency decision makers monitor and oversee how the fund is performing on the services provided.

    Agency: Department of the Treasury
    Status: Open

    Comments: Treasury concurred with the recommendation. In March 2017, GAO contacted Treasury for a status update on how the recommendation is being addressed. We will update the status when the update is received.
    Recommendation: To help enhance efforts to expand shared services and improve the management of the TFF, the Secretary of the Treasury should develop an operating reserve policy that documents all existing review processes that relate to management of the TFF's operating reserves. These documented policies should include information on how fund managers are to assess the operating reserves, including guidelines to evaluate, use, and maintain the operating reserves over time.

    Agency: Department of the Treasury
    Status: Open

    Comments: Treasury concurred with the recommendation. In March 2017, GAO contacted Treasury for a status update on how the recommendation is being addressed. We will update the status when the update is received.
    Director: Lawrance Evans, Jr.
    Phone: (202) 512-8678

    6 open recommendations
    Recommendation: Congress should consider whether additional changes to the financial regulatory structure are needed to reduce or better manage fragmentation and overlap in the oversight of financial institutions and activities to improve (1) the efficiency and effectiveness of oversight; (2) the consistency of consumer and investor protections; and (3) the consistency of financial oversight for similar institutions, products, risks, and services. For example, Congress could consider consolidating the number of federal agencies involved in overseeing the safety and soundness of depository institutions, combining the entities involved in overseeing the securities and derivatives markets, transferring the remaining prudential regulators' consumer protection authorities over large depository institutions to the Consumer Financial Protection Bureau, and the optimal role for the federal government in insurance regulation, among other considerations.

    Agency: Congress
    Status: Open

    Comments: One bill has been introduced in the 115th Congress that would change the financial regulatory structure to address fragmented and overlapping regulatory authorities among agencies, as GAO suggested in February 2016. H.R. 594 was introduced on January 20, 2017, and calls for the functions of the Commodity Futures Trading Commission and the Securities and Exchange Commission to be combined in a single independent regulatory commission. Such an action could help to address fragmentation and overlap between the two agencies, and reduce opportunities for inefficiencies in the regulatory process and inconsistencies in how regulators conduct oversight activities over similar types of institutions, products, and risks.
    Recommendation: Congress should consider whether legislative changes are necessary to align FSOC's authorities with its mission to respond to systemic risks. Congress could do so by making changes to FSOC's mission, its authorities, or both, or to the missions and authorities of one or more of the FSOC member agencies to support a stronger link between the responsibility and capacity to respond to systemic risks. In doing so, Congress could solicit information from FSOC on the effective scope of its collective designation authorities, including any gaps.

    Agency: Congress
    Status: Open

    Comments: No legislative action identified. As of March 1, 2017, no legislation had been introduced that would align FSOC's authorities with its mission to respond to systemic risks, as GAO suggested in February 2016. Without such legislative changes, FSOC may lack the tools it needs to comprehensively address systemic risks that may emerge, and a gap will continue to exist in the post Dodd-Frank Wall Street Reform and Consumer Protection Act mechanisms for the mitigation of systemic risks.
    Recommendation: To help regulators address regulatory fragmentation and improve FSOC's ability to identify emerging systemic risks, as OFR develops and refines its financial stability monitoring tools, it should work with FSOC to determine ways in which to fully and regularly incorporate current and future monitors and assessments into Systemic Risk Committee deliberations, including, where relevant, those that present disaggregated or otherwise confidential supervisory information.

    Agency: Department of the Treasury: Financial Stability Oversight Council: Office of Financial Research
    Status: Open

    Comments: At the FSOC Systemic Risk Committee meeting held in December 2016, Treasury indicated that Office of Financial Research staff presented on the agency's Financial Stability Report. Officials indicated that they provided an assessment on potential financial stability risks, including macroeconomic, market, credit, funding and liquidity, and contagion risks. Systemic Risk Committee meeting attendees were able to compare and contrast these with the results from the Federal Reserve's systemic risk monitoring activities, which were also presented at the meeting. Office of Financial Research officials stated that there was general consensus at the meeting that these discussions were useful and that they should continue. GAO does not believe that this action is consistent with the intent of if February 2016 recommendation to fully and regularly incorporate current and future monitors and assessments into FSOC's Systemic Risk Committee deliberations. While GAO encourages sharing this type of information, the Office of Financial Research's Financial Stability Report is a publicly-available report. The intent of GAO's recommendation was to encourage the agency to fully incorporate all of its monitors into Systemic Risk Committee discussions, including its Financial Stability Monitor--its benchmark tool for assessing risks across the financial system. In addition, in its February 2016 report, GAO encouraged the agency to seek ways in which monitors that present disaggregated or otherwise confidential supervisory information can be incorporated in committee discussions. Without sharing such monitors and information, the Systemic Risk Committee may identify and advance the analysis of only a subset of systemic risks in a timely manner and may identify others too late or miss others altogether. The Financial CHOICE Act of 2016 was introduced in the 114th Congress. The act called for the Office of Financial Research to be eliminated. It was not passed before the end of the 114th Congress.
    Recommendation: To help regulators address regulatory fragmentation and improve FSOC's ability to identify emerging systemic risks, the Federal Reserve should work with FSOC to regularly incorporate the comprehensive results of its systemic risk monitoring activities into Systemic Risk Committee deliberations.

    Agency: Federal Reserve System
    Status: Open

    Comments: As of March 1, 2017, Federal Reserve officials indicated that they provided a presentation to FSOC's Systemic Risk Committee in December 2016, which included comprehensive results from its systemic risk monitoring activities. This action appears to be consistent with GAO's February 2016 recommendation, but the documentation provided by the Federal Reserve did not provide sufficient evidence that the agency has regularly incorporated these results into Systemic Risk Committee meetings. GAO will continue to monitor the Federal Reserve's participation in Systemic Risk Committee meetings to ensure that the agency continues to provide both regular and comprehensive results to the committee. Without better access to systemic risk monitoring tools and other outputs, the Systemic Risk Committee may identify and advance the analysis of only a subset of systemic risks in a timely manner and may identify others too late or miss others altogether.
    Recommendation: To more efficiently and effectively monitor the financial system for systemic risks and reduce the risk of unnecessary duplication, OFR and the Federal Reserve should jointly articulate individual and common goals for their systemic risk monitoring activities, including a plan to monitor progress toward articulated goals, and formalize regular strategic and technical discussions around their activities and outputs to support those goals.

    Agency: Department of the Treasury: Financial Stability Oversight Council: Office of Financial Research
    Status: Open

    Comments: As of March 1, 2017, the Federal Reserve and the Office of Financial Research had coordinated to organize semi-annual meetings to jointly discuss views from their respective monitoring of the financial system for risks; but these meetings had not yet taken place. The first of these meetings is to be held in May 2017 following the agencies' respective systemic risk exercises. Initiating these discussions addresses part of GAO's February 2016 recommendation. GAO plans to review documentation from these meetings in 2017 to further assess if the agencies will use these meetings to jointly articulate individual and common goals, including developing a plan to monitor progress toward the goals. Fully addressing GAO's recommendation could help to ensure comprehensiveness in systemic risk surveillance and reduced risk of duplication. On September 9, 2016, the Financial CHOICE Act of 2016 was introduced. It called for the Office of Financial Research to be eliminated. The legislation did not pass before the 114th Congress ended.
    Recommendation: To more efficiently and effectively monitor the financial system for systemic risks and reduce the risk of unnecessary duplication, OFR and the Federal Reserve should jointly articulate individual and common goals for their systemic risk monitoring activities, including a plan to monitor progress toward articulated goals, and formalize regular strategic and technical discussions around their activities and outputs to support those goals.

    Agency: Federal Reserve System
    Status: Open

    Comments: As of March 1, 2017, the Federal Reserve and the Office of Financial Research had coordinated to organize semi-annual meetings to jointly discuss views from their respective monitoring of the financial system for risks; but these meetings had not yet taken place. The first of these meetings is to be held in May 2017 following the agencies' respective systemic risk exercises. Initiating these discussions addresses part of GAO's February 2016 recommendation. GAO plans to review documentation from these meetings in 2017 to further assess if the agencies will use these meetings to jointly articulate individual and common goals, including developing a plan to monitor progress toward the goals. Fully addressing GAO's recommendation could help to ensure comprehensiveness in systemic risk surveillance and reduced risk of duplication. On September 9, 2016, the Financial CHOICE Act of 2016 was introduced. It called for the Office of Financial Research to be eliminated. The legislation did not pass before the 114th Congress ended.
    Director: John Neumann
    Phone: (202) 512-3841

    1 open recommendations
    Recommendation: To better ensure that the activities carried out under the ITM program do not duplicate the efforts of other federal loan guarantee programs, such as SBA's 7(a) program, the Secretary of Commerce should direct EDA to work with SBA and NIST to further identify any gaps in capital access that may be present that the program could fill, and then develop marketing materials and conduct outreach to help target those gaps.

    Agency: Department of Commerce
    Status: Open

    Comments: Partially addressed. As of November 2016 the Economic Development Administration (EDA) had begun taking action on GAO's February 2016 recommendation to work with SBA and NIST to identify gaps in capital access and develop marketing materials and conduct outreach based on any gaps identified for the Federal Loan Guarantees for Innovative Technologies in Manufacturing program (ITM). Due to delays in establishing the program, however, these efforts are still in progress. According to EDA officials, as of November 28, 2016 EDA contractors working on the ITM program had held a preliminary discussion with SBA to discuss program marketing, outreach and potential gaps in capital access that the ITM program may be able to fill, among other topics, but had not yet initiated additional coordination with NIST. We continue to believe that coordination with SBA and NIST to identify gaps in capital access, and then marketing the program to target those gaps could help EDA ensure that ITM program activities do not duplicate the efforts of other federal loan guarantee programs.
    Director: Mihm, J Christopher
    Phone: (202) 512-3236

    1 open recommendations
    including 1 priority recommendation
    Recommendation: To help ensure that agencies report consistent and comparable data on federal spending, the Director of OMB, in collaboration with the Secretary of the Treasury, should provide agencies with additional guidance to address potential clarity, consistency, or quality issues with the definitions for specific data elements including Award Description and Primary Place of Performance and that they clearly document and communicate these actions to agencies providing this data as well as to end-users.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: In May 2016, OMB issued guidance for DATA Act Implementation entitled, Implementing Data-Centric Approach for Reporting Federal Spending Information (Management Procedures Memorandum No. 2016-03). This memorandum provided guidance on new federal prime award reporting requirements, agency assurances, and authoritative sources for reporting. In August 2016, OMB released additional draft guidance describing how agencies should report financial information involving intragovernmental transfers and personally identifiable information, as well as how agency Senior Accountable Officials should provide quality assurances for submitted data. Despite these positive steps, we continue to have concerns about the need for additional guidance to facilitate agency implementation of certain data definitions (such as "primary place of performance" and "award description") in order to produce consistent and comparable information, and whether the guidance provides sufficient detail in areas such as the process for providing assurance on data submissions.
    Director: Anne-Marie Fennell
    Phone: (202) 512-3841

    1 open recommendations
    Recommendation: To help improve its management of recreation fees, the Secretary of the Interior should direct the Director of the Park Service to revise its guidance on recreation fees so that the agency periodically reviews its entrance fees to determine whether the fees are reasonable.

    Agency: Department of the Interior
    Status: Open

    Comments: In its initial response to our published report, the Park Service stated that it plans to revise Reference Manual 22A: Recreation Fee Collection (RM22A). This revision will include a requirement to reevaluate the entrance fee pricing structure every 3 years. The Park Service last reviewed and updated the fee schedule in August 2014. As of November 2016, the Park Service told GAO that it was planning to review its fee schedule on a 3-year cycle, so the next review will be in 2017. The agency also reported that it was on track to update its guidance to reflect this new schedule, but has not yet completed this effort. We will continue to monitor agency progress in implementing this recommendation.
    Director: J. Lawrence Malenich
    Phone: (202) 512-9399

    1 open recommendations
    Recommendation: The Foundation's Executive Director should update the Foundation's draft written policies and procedures over its contracting practices to include all key internal control activities, issue them in final form, and establish a date by which these actions will be completed.

    Agency: Morris K. Udall and Stewart L. Udall Foundation
    Status: Open

    Comments: The Foundation concurred with our recommendation and stated that it will implement the recommended actions. In addition, the Foundation stated that our recommendations will be incorporated in the Foundation's risk assessment documentation, established as a priority, and included in the Foundation's fiscal year 2016 Corrective Action Plan. As of July 2017, the Foundation has not implemented corrective actions to address this recommendation.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    1 open recommendations
    including 1 priority recommendation
    Recommendation: To help meet its financial management improvement and audit readiness goals, the Secretary of Defense should direct the Under Secretary of Defense (Comptroller) to reconsider the status of the three panel recommendations that DOD classified as met that we determined were partially met and take the necessary actions to reasonably assure that these recommendations have been met.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: In September 2015, we reported that DOD had completed action on 6 of the Committee Panel's 29 recommendations. However, we disagreed with DOD's reported status of met for 3 other recommendations related to (1) attestations on audit readiness to be included in each of the Financial Improvement and Audit Readiness (FIAR) Plan Status Reports; (2) inclusion of FIAR-related goals in Senior Executive Service performance plans, and rewarding and evaluating performances over time based on those goals; and (3) the review of audit readiness assertions by component senior executive committees. In response to our recommendation, in its November 2015 FIAR Plan Status Report, DOD revised the implementation status for these three recommendations from met to partially met and gave further consideration to actions needed to reasonably assure whether the recommendations had been met. In its May 2016 FIAR Plan Status Report DOD stated that it had completed corrective action on one of these three Committee Panel recommendations and reported actions on the other two recommendations as partially met. As of May 2017, DOD reported that its actions for all three Congressional Panel recommendations met those recommendations. However, DOD had not yet identified a method to reward executives based on evaluated performance on FIAR-related goals. In addition, DOD needs to continue to state in each FIAR Plan Status Report whether DOD is on track to be audit ready as of September 30, 2017. Therefore, as of August 30, 2017, this recommendation was still open.
    Director: J. Alfredo Gómez
    Phone: (202) 512-3841

    2 open recommendations
    including 1 priority recommendation
    Recommendation: To improve EPA's review and oversight of the SRF program, the Administrator of EPA should direct the Office of Water to update the financial indicators guidance to include one or more of EPA's financial measures for identifying the growth of states' SRF funds.

    Agency: Environmental Protection Agency
    Status: Open
    Priority recommendation

    Comments: As of April 2017, EPA is finalizing changes to its financial indicators to help identify the growth of states' SRF funds, according to EPA officials. EPA officials told us it had established a joint EPA/state workgroup that proposed draft financial indicators for the State Revolving Funds (SRF). These draft indicators are intended to address financial sustainability and the extent to which funds are being used efficiently. EPA plans to issue a memorandum to finalize these updated indicators in the summer of 2017. GAO will review EPA's memorandum when it is issued to determine if the recommendation can be closed.
    Recommendation: To improve EPA's review and oversight of the SRF program, the Administrator of EPA should direct the Office of Water to use information on SRF funds' past performance to develop projections of SRF programs by forecasting future lending capacity during regional office reviews of states' SRF programs using factors such as future interest earnings and inflation rates.

    Agency: Environmental Protection Agency
    Status: Open

    Comments: As of April 2017, EPA is finalizing its tools and guidance to regional offices to forecast states' future lending capacity, according to EPA officials. EPA officials told us that it had enhanced its State Revolving Fund (SRF) Financial Planning Model to align future loan projections with target cash balances. EPA's Office of Water will work with EPA regional offices to use the updated SRF Financial Planning Model for SRF forecasts that will support annual regional reviews of state SRF programs. EPA will update its guidance to EPA regional offices to use these forecasts in their reviews of the state SRF programs beginning in 2017 or early 2018. GAO will review EPA's guidance when it is finalized to determine if this recommendation can be closed.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    1 open recommendations
    Recommendation: To improve the quality of DOD's financial statement audits and ensure that corrective actions to address audit recommendations are fully and effectively implemented prior to their closure, the Department of Defense Inspector General should ensure that Marine Corps corrective actions fully address audit recommendations and document auditor review of the actions taken before closing the related recommendations.

    Agency: Department of Defense: Office of the Inspector General
    Status: Open

    Comments: Our follow up in fiscal year 2015 was limited to a request for a documented process the DOD-IG may have developed and implemented to ensure all control issues detailed in the NFRs have been fully resolved; related corrective action plans were relevant and reviewed consistently and adequately; and the IPA/DOD-IG reviews were documented as part of the NFR review process. DOD-IG was not able to provide such documentation to support the statement provided in its response to our recommendation at the time the report was issued. Consequently, there was no documentation for us to review. In August 2017, we contacted the DOD-IG and requested an update on the status of efforts to address this recommendation. Also, per the contract with an IPA for the USMC's fiscal year 2017 financial statement audit, the IPA is to follow up on status of efforts to address prior year recommendations.
    Director: Beryl H. Davis
    Phone: (202) 512-2623

    3 open recommendations
    Recommendation: To strengthen BLM's controls and reasonably assure accountability over mining law program expenditures, both payroll and nonpayroll, the Secretary of the Interior should direct the Director of the Bureau of Land Management to establish procedures for regular and timely communication to all BLM employees on policy and procedural changes affecting the mining law program's expenditure-related processes.

    Agency: Department of the Interior
    Status: Open

    Comments: In support of closing this recommendation, officials from the Department of Interior's (DOI) Bureau of Land Management (BLM) provided us with an example of its timely communication (dated September 20, 2016) to BLM employees to announce the issuance of its revised Fund Code Handbook (dated August 12, 2016). They also re-iterated their policy about sending updates regarding guidance changes, which is included in its directives handbook. We reviewed the directives handbook and verified that it contains guidance for communicating policy and procedural changes affecting the mining law program's expenditure-related processes. However, we were unable to determine what procedures were established to ensure the regular and timely communication to all employees of policy and procedural changes take place. While we see the directives handbook is a good start towards meeting the intent of our recommendation, we did not see evidence within the directives handbook that requires these communications to be sent to employees within a specific timeframe (e.g., within 30 days of issuance of policy and procedural changes). We will continue to monitor the agency's actions to address this recommendation.
    Recommendation: To strengthen BLM's controls and reasonably assure accountability over mining law program expenditures, both payroll and nonpayroll, the Secretary of the Interior should direct the Director of the Bureau of Land Management to develop and implement a training program that provides all BLM employees with an understanding of the use of the mining law program funds to reasonably assure uniform application and effective execution of BLM policies and procedures. This training, to be successful, should be provided to all BLM employees who charge the program and communicate clear instructions on how employees should charge, document, and review transactions related to mining law program expenditures.

    Agency: Department of the Interior
    Status: Open

    Comments: The Department of Interior's (DOI) Bureau of Land Management (BLM) agreed with our recommendation. On September 22, 2016, DOI's BLM informed us that the training material that will address this recommendation has been developed and reviewed by the BLM's Mining Law Administration Program and Budget leads. The BLM's National Training Center is currently preparing the training to be posted to "DOI Learn", the Department of the Interior's training portal. Once the training is ready for use, BLM anticipates issuing an Information Memorandum that directs targeted staff to complete the training. At the present time, the training is expected to be ready by end of fiscal year 2017. We will continue to monitor the agency's actions to address this recommendation.
    Recommendation: To strengthen BLM's controls and reasonably assure accountability over mining law program expenditures, both payroll and nonpayroll, the Secretary of the Interior should direct the Director of the Bureau of Land Management to develop and implement internal control activities for regularly monitoring compliance with expenditure-related policies and procedures in the mining law program. These activities should, at a minimum, (1) determine whether transactions were recorded to the correct subactivity and verified by an approving official and (2) assure that documentary evidence of review is maintained, as required in BLM's policies and procedures.

    Agency: Department of the Interior
    Status: Open

    Comments: The Department of Interior's (DOI) Bureau of Land Management (BLM) agreed with our recommendation. On September 22, 2016, DOI's BLM informed us that DOI's BLM is developing a repeatable standardized annual internal control process which will include validation of Mining Law Administration Program (MLAP) expenditure transactions utilizing a "canned" report that is generated from the Financial Business Management System (FBMS), which is DOI's BLM's financial accounting system. This process will be incorporated into an existing DOI's BLM-wide budgetary review cycle requirement, such as the formal mid-year or 3rd quarter fiscal year reviews. The MLAP expenditures report will be distributed to DOI?s BLM state offices with instructions to obtain an adequate sample size from which to test MLAP fund transactions for compliance with Bureau policy. State budget officials will be required to identify their findings, corrective actions and certify the results from this exercise. It is anticipated that this requirement will be disseminated to the DOI's BLM state offices by Instruction Memorandum. The source report to be used for these reviews is still in the development stage and it is expected to be completed by end of fiscal year 2017. We will continue to monitor the agency's actions to address this recommendation.
    Director: Goldstein, Mark L
    Phone: (202) 512-2834

    2 open recommendations
    Recommendation: To strengthen the Washington Metropolitan Area Transit Authority's (WMATA) risk assessment and monitoring components of internal control, WMATA's board of directors, working with the General Manager and Chief Executive Officer of WMATA, should direct the appropriate WMATA officials to develop and implement a policy and related procedures for assessing WMATA's financial management-related risks.

    Agency: Washington Metropolitan Area Transit Authority
    Status: Open

    Comments: In July and August 2016, WMATA officials described to GAO the steps they have taken to address this recommendation. However, WMATA did not provide sufficient supporting documentation for GAO to verify that the recommendation was implemented. GAO continues to work with WMATA to understand the steps it has taken to address this recommendation.
    Recommendation: To strengthen the WMATA's risk assessment and monitoring components of internal control, WMATA's board of directors, working with the General Manager and Chief Executive Officer of WMATA, should direct the appropriate WMATA officials to develop and implement a policy and related written procedures for the Office of Internal Compliance to monitor the design and operating effectiveness of the five components of internal control related to financial management.

    Agency: Washington Metropolitan Area Transit Authority
    Status: Open

    Comments: In July and August 2016, WMATA officials described to GAO the steps they have taken to address this recommendation. However, WMATA did not provide sufficient supporting documentation for GAO to verify that the recommendation was implemented. GAO continues to work with WMATA to understand the steps it has taken to address this recommendation.
    Director: Dalkin, James R
    Phone: (202) 512-3133

    1 open recommendations
    Recommendation: The U.S. Securities and Exchange Commission should direct the COO and CFO to implement controls, such as periodic reviews of asset dispositions, to help reasonably assure that SEC's procedures for the preparation and maintenance of documentation related to the disposition of assets are consistently implemented and that any deviations from established procedures are documented.

    Agency: United States Securities and Exchange Commission
    Status: Open

    Comments: SEC Officials are still working on corrective actions as of the end of fiscal year 2016. We will follow up on this recommendation during our fiscal year 2017 SEC financial statement audit.
    Director: J. Christopher Mihm
    Phone: (202) 512-6806

    1 open recommendations
    Recommendation: The Director of the Office of Management and Budget should direct, as appropriate, federal agencies involved with the White House Working Group on Detroit, to collect good practices and lessons learned from their efforts to assist Detroit during its fiscal crisis and share them with other federal agencies and local governments. Toward this end, OMB may want to consider making use of existing knowledge and capacity associated with the Strong Cities, Strong Communities Initiative and its National Resource Network.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: In commenting on a draft of GAO's March 2015 report, OMB neither agreed nor disagreed with this recommendation. In April 2017, OMB staff stated that they believed steps had been taken to preserve some of the lessons coming out of the administration's efforts to assist the City of Detroit during its fiscal crisis. However, they were unable to provide specifics. GAO has requested additional information and supporting documentation regarding this effort.
    Director: Zina D. Merritt
    Phone: (202) 512-5257

    3 open recommendations
    Recommendation: To help DOD increase the efficiency and effectiveness of its management of its business operations, and to enhance DOD's ability to achieve its business transformation efforts, the Secretary of Defense should direct the Deputy Secretary of Defense, in his capacity as the CMO, to ensure that the DCMO document business transformation priorities and communicate these priorities to officials responsible for DOD's business functions.

    Agency: Department of Defense
    Status: Open

    Comments: DOD has developed an updated draft of its Agency Strategic Plan for Fiscal Years 2015-2018. Once this draft is signed and issued, we believe it will communicate the department's priorities for its business operations. DOD DCMO officials estimate that the plan will be signed and issued in October 2016.
    Recommendation: To help DOD increase the efficiency and effectiveness of its management of its business operations, and to enhance DOD's ability to achieve its business transformation efforts, the Secretary of Defense should direct the Deputy Secretary of Defense, in his capacity as the CMO, to ensure that the DCMO oversee the development of a corrective action plan, in coordination with officials responsible for DOD business functions, that outlines the root causes for business transformation weaknesses and the solutions needed to address those weaknesses.

    Agency: Department of Defense
    Status: Open

    Comments: DOD has developed an appendix in an updated draft of its Agency Strategic Plan for Fiscal Years 2015-2018 that is titled "Performance Action Plan," but we not yet reviewed this appendix, so cannot assess whether this would meet the intent of our recommendation that they develop a corrective action plan. DOD DCMO officials estimate that the plan, which includes this appendix, will be signed and issued in October 2016.
    Recommendation: To help DOD increase the efficiency and effectiveness of its management of its business operations, and to enhance DOD's ability to monitor the progress of its business transformation efforts, the Secretary of Defense should direct the Office of the DCMO to, in coordination with officials responsible for DOD's business functions, develop performance measures that reflect key attributes of successful performance measures, such as clarity, comprehensiveness, and linkage.

    Agency: Department of Defense
    Status: Open

    Comments: DOD has developed an updated draft of its Agency Strategic Plan for Fiscal Years 2015-2018 that contains a set of performance measures that are more clear and comprehensive than the measures contained in previous strategic plans. This plan also demonstrates how the performances measures to link to strategic goals and objectives. DOD DCMO officials estimate that the plan will be signed and issued in October 2016.
    Director: Charles Michael Johnson, Jr.
    Phone: (202) 512-7331

    1 open recommendations
    Recommendation: To help improve implementation and oversight of the MODA program, the Secretary of Defense should consider providing additional performance information to Congress on the extent to which DOD is achieving its advisor assignments and program expansion relative to its goals.

    Agency: Department of Defense
    Status: Open

    Comments: In May 2016, DOD said that the MoDA program drafted a performance management framework which will establish program goals, objectives, and performance indicators to assess progress and measure results. However, as of October 2017, DOD had not provided evidence that the framework had been implemented.
    Director: Andrew Sherrill
    Phone: (202) 512-7215

    1 open recommendations
    Recommendation: To enhance communication with contractors about Job Corps program changes, the Secretary of Labor should direct the Assistant Secretary for Employment and Training to review the sufficiency of ETA's guidance for internal notices--including Program Instruction Notices, Policy and Requirements Handbook Change Notices, and Information Notices--to ensure that contractors are provided with adequate notification of program changes before they are expected to be implemented, and an adequate level of information to assist them in carrying out their responsibilities.

    Agency: Department of Labor
    Status: Open

    Comments: DOL concurred with this recommendation, acknowledging the importance of ensuring that Job Corps contractors are provided adequate notification of program changes before their expected implementation. To address this, DOL stated that it would review the sufficiency of Job Corps guidance for internal notices, and execute and distribute any contractual actions, such as modifications, in a timely manner. In FY16, DOL reported that ETA implemented a procedure for developing policy guidance that includes establishing an effective date for program changes that takes into consideration an appropriate amount of time for implementation. The agency referred to Change Notice 15-09 (dated February 4, 2016) and Information Notice 15-34, which extends the implementation date of this change from May 1 to June 1, 2016. GAO requested the written procedure ETA used to develop its policy guidance, but ETA officials were unable to provide it. The officials stated that they would review its response to this recommendation after the beginning of FY17.
    Director: Rebecca Gambler
    Phone: (202) 512-8777

    3 open recommendations
    Recommendation: To enhance ICE's ability to analyze and manage detention facility costs, ensure transparency and accountability in the management of detention facilities, and strengthen the oversight mechanisms that ensure detention facilities provide safe, secure, and humane confinement, the Director of U.S. Immigration and Customs Enforcement should assess the extent to which ICE has appropriate internal controls for tracking and managing detention facility costs and develop additional controls as necessary.

    Agency: Department of Homeland Security: United States Immigration and Customs Enforcement
    Status: Open

    Comments: As of December 2016, no additional information had been provided on the status of ICE efforts to address this recommendation. In February 2015, the Department of Homeland Security (DHS) reported that Immigration and Customs Enforcement (ICE) had created a spend plan tool to help track costs for each detention facility. In addition, DHS reported that ICE headquarters and field offices were coordinating to determine the resources needed to track and manage detention facilities costs. To fully address this recommendation, ICE should assess the extent to which the spend plan tool is an appropriate internal control for tracking and managing detention facilities costs and whether additional controls are necessary.
    Recommendation: To enhance ICE's ability to analyze and manage detention facility costs, ensure transparency and accountability in the management of detention facilities, and strengthen the oversight mechanisms that ensure detention facilities provide safe, secure, and humane confinement, the Director of U.S. Immigration and Customs Enforcement should document the reasons facilities cannot be transitioned to the most recent standards.

    Agency: Department of Homeland Security: United States Immigration and Customs Enforcement
    Status: Open

    Comments: The Department of Homeland Security (DHS) did not concur with this recommendation. As of December 2016, no additional information had been provided on the status of Immigration and Customs Enforcement (ICE) efforts to address this recommendation. To fully address this recommendation, ICE should document the reasons detention facilities cannot be transition to the most recent national detention standards.
    Recommendation: To enhance ICE's ability to analyze and manage detention facility costs, ensure transparency and accountability in the management of detention facilities, and strengthen the oversight mechanisms that ensure detention facilities provide safe, secure, and humane confinement, the Director of U.S. Immigration and Customs Enforcement should take additional steps to help ensure that personnel responsible for reviewing and paying facility detention invoices follow internal control procedures to ensure proper payments.

    Agency: Department of Homeland Security: United States Immigration and Customs Enforcement
    Status: Open

    Comments: As of December 2016, no additional information had been provided on the status of ICE efforts to address this recommendation. In October 2014, the Department of Homeland Security (DHS) reported that Immigration and Customs Enforcement (ICE) had issued a new "Receipt & Acceptance" policy applicable to all program offices and would assess if additional internal controls are required and implement any needed ones, as appropriate. In February 2015, DHS reported that ICE had not finalized an impact assessment of the new policy for fiscal year 2014 to determine if additional controls would be required. To fully address this recommendation, ICE should complete an impact assessment of the new policy to determine if additional controls are needed to ensure proper payment of facility detention invoices.
    Director: Susan Fleming
    Phone: (202) 512-2834

    1 open recommendations
    Recommendation: To improve transparency and provide Congress and the public greater visibility into the types of highway activities funded with Highway Trust Fund monies, the Secretary of Transportation should direct the FHWA Administrator to explore the costs, feasibility, and options for collecting and publicly reporting consistent aggregate project-level spending data.

    Agency: Department of Transportation
    Status: Open

    Comments: FHWA agreed with the recommendation and stated that it was reviewing the feasibility and options for collecting and reporting aggregate project-level highway spending data, and that it intended to complete this review by December 2015. In December 2015, the President signed the Fixing America's Surface Transportation Act or "FAST Act". Sec. 1402 of the Act requires DOT to annually report, for all projects administered by FHWA with a total estimated cost of $25 million or more (and for all other projects to the extent practicable), on the total cost of funded projects, the amount of federal funds obligated, and other information, and to make this information "available in a user-friendly manner on the public Internet website of the Department of Transportation." GAO is monitoring DOT's efforts to implement this provision of the Act and the extent to which it fulfills GAO's recommendation.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    2 open recommendations
    Recommendation: To help improve the implementation of GCSS-Army, the Secretary of the Army should ensure that the Under Secretary of the Army, in his capacity as the Chief Management Officer, directs the GCSS-Army Program Management Office to develop an updated schedule that fully incorporates best practices, including (1) assigning resources to all activities, (2) establishing durations of all activities, (3) confirming that the critical path is valid, and (4) ensuring reasonable total float.

    Agency: Department of Defense: Department of the Army
    Status: Open

    Comments: We are in the process of obtaining an updated integrated master schedule from DOD to determine if Army fully incorporated best practices. As of June 2017,Army officials told us that the integrated master schedule and revised cost estimate will not be available until December 2017. This recommendation remains open.
    Recommendation: To help improve the implementation of GCSS-Army, the Secretary of the Army should ensure that the Under Secretary of the Army, in his capacity as the Chief Management Officer, directs the GCSS-Army Program Management Office to update the cost estimate to fully incorporate best practices by documenting the results of (1) a risk and uncertainty analysis, (2) the cross-checking of major cost elements to see if results are similar, and (3) a sensitivity analysis.

    Agency: Department of Defense: Department of the Army
    Status: Open

    Comments: We are in the process of obtaining an updated cost estimate from DOD to determine if Army fully incorporated best practices. As of June 2017, Army officials told us that the integrated master schedule and revised cost estimate will not be available until December 2017. This recommendation remains open.
    Director: Beryl H. Davis
    Phone: (202) 512-2623

    2 open recommendations
    Recommendation: The Secretary of Health and Human Services should direct the Administrator of the Centers for Medicare and Medicaid Services to develop and implement policies and procedures for responding to nonroutine CCIIO-related financial management information requests, including procedures for documenting the preparation process and the review and approval of the results.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: The Department of Health and Human Services (HHS) disagreed with this recommendation. HHS management indicated that it has up-to-date and clearly documented standard operating procedures (SOP) for its normal day-to-day work processes, and did not believe that non-standard data requests lend themselves to documented, standard SOPs. In May 2016, HHS indicated that its position on this issue has not changed. In June 2017, HHS indicated that its position on this issue has not changed. GAO believes the recommendation is still valid.
    Recommendation: The Secretary of Health and Human Services should direct the Administrator of the Centers for Medicare and Medicaid Services to identify and evaluate options to facilitate more timely and independently verifiable reporting of CCIIO-related financial management information, such as enhancing Healthcare Integrated General Ledger Accounting System's standard reporting or custom reporting capabilities.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: The Department of Health and Human Services (HHS) disagreed with this recommendation. HHS indicated that it tracks appropriations in accordance with all relevant federal laws and regulations, and that the information was complete and verifiable. Federal accounting concepts and standards concerning managerial cost accounting allow flexibility for agency managers to develop costing methods that are best suited to their operational environment. HHS indicated that would continue to evaluate options of enhancing the standard and/or custom reporting capabilities of its core financial system; the Health Integrated General Ledger System (HIGLAS). In May 2016, HHS indicated that its position on this issue has not changed. In June 2017, HHS indicated that its position on this issue has not changed. GAO believes the recommendation is still valid.
    Director: Clark, Cheryl E
    Phone: (202) 512-9377

    2 open recommendations
    Recommendation: The Commissioner of Internal Revenue should direct the appropriate IRS officials to establish and implement policies and procedures requiring a review process to reasonably assure that the accounts related to deceased taxpayers are only reopened for valid refunds.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In January 2016, IRS automated the process of locking deceased taxpayer accounts during its year-end processing. However, during our fiscal year 2016 audit, we continued to find instances in which IRS employees reopened deceased taxpayer accounts and disbursed invalid refunds. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The Commissioner of Internal Revenue should direct the appropriate IRS officials to establish and implement policies and procedures that require monitoring to reasonably assure that accounts related to deceased taxpayers that have been reopened are timely closed after processing the refund.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In January 2016, IRS automated the process of locking accounts related to deceased taxpayers during its year-end processing. However, during our fiscal year 2016 audit, we continued to find instances in which IRS employees reopened deceased taxpayer accounts to process refunds and did not close them timely. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Director: Gary Engel
    Phone: (202) 512-3406

    2 open recommendations
    including 2 priority recommendations
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary, working in coordination with the Controller of OMB, to establish and implement policies and procedures for accounting for and reporting all significant General Fund activity and balances, obtaining assurance on the reliability of the amounts, and reconciling the activity and balances between the General Fund and federal entities.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury has established the General Fund as a federal reporting entity. In fiscal year 2017, the focus will be on preparing for the first financial audit of the General Fund. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary, working in coordination with the Controller of OMB, to establish a formalized process to require the performance of additional audit procedures specifically focused on intragovernmental activity and balances between federal entities to provide increased audit assurance over the reliability of such information.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. As a result of multiple initiatives over the past few years, Treasury and OMB have seen a significant decrease in elimination differences of intragovernmental data submitted by federal entities. Therefore, Treasury and OMB have determined at this time there is not a justified need for the additional cost and burden on federal entities to implement additional audit procedures specifically focused on intragovernmental activity and balances. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Director: James R. McTigue, Jr.
    Phone: (202) 512-9110

    3 open recommendations
    including 1 priority recommendation
    Recommendation: As a result of turnover in IRS's Senior Executive Team and in order to enhance budget planning and improve decision making and accountability, the Commissioner of Internal Revenue should develop a long-term strategy to address operations amidst an uncertain budget environment. As part of the strategy, IRS should take steps to improve its efficiency, including (1) reexamining programs, related processes, and organizational structures to determine whether they are effectively and efficiently achieving the IRS mission, and (2) streamlining or consolidating management or operational processes and functions to make them more cost-effective.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open
    Priority recommendation

    Comments: IRS agreed with our recommendation and is taking steps to implement it. For example, IRS has adopted a new, more strategic approach to identify and select budget program priorities. In its fiscal year 2017 budget justification, IRS introduced six themes of its Future State Initiative for tax administration, which in part aims to deliver service improvements across different taxpayer interactions such as individual account assistance, refunds, identity theft, and billings and payments. The budget also linked requested spending increases to the themes laid out in the initiative. The themes were derived from a subset of its 19 objectives identified in the IRS 2014-2017 Strategic Plan. In addition to the future state themes and strategic objectives, IRS has identified enterprise goals to guide the IRS toward the future state. As of December 2016, IRS has yet to set targets for meeting the goals but plans to have targets in place by June 2017. We acknowledge the steps IRS has taken and will continue to monitor its progress as the process is further developed.
    Recommendation: Because ROI provides insights on the productivity of a program and is one important factor in making resource allocation decisions, the Commissioner of Internal Revenue should calculate actual ROI for implemented initiatives, compare the actual ROI to projected ROI, and provide the comparison to budget decision makers for initiatives where IRS allocated resources.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: No executive action taken. While IRS agreed that having actual ROI data for implemented initiatives would be useful, it did not believe it was feasible to produce such estimates, as GAO recommended in June 2014. GAO maintains that IRS should be able to provide some information on past initiatives, such as whether funds requested were used in the manner originally proposed. As of December 2016, IRS officials reported there is no timeline for full implementation. In March 2017, IRS officials confirmed that they do not isolate the revenue attributable to a specific initiative, but pointed to other efforts to help manage IRS's budget, including establishing the Office of Planning, Programming and Audit Coordination and the Planning Community of Practice, which are intended to improve investment planning processes. While these efforts are intended to help IRS act more strategically, comparing projected ROI to actual ROI can help hold managers and IRS accountable for the funding received.
    Recommendation: Because ROI provides insights on the productivity of a program and is one important factor in making resource allocation decisions, the Commissioner of Internal Revenue should use actual ROI calculations as part of resource allocation decisions.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: No executive action taken as of March 2017. IRS's Research, Analysis, and Statistics Division has begun to estimate marginal direct revenues and marginal costs attributable to specific compliance projects. The estimates are necessary inputs to establish a measure of ROI, which in turn can guide resource allocation decisions. IRS plans to use these estimates to inform future examination plans, but considerable work remains in this long-term effort. In October 2016, IRS officials reported there is no timeline for full implementation, but that the work is on-going. In June 2016, IRS officials confirmed that projected revenue will be considered in investment decision making as part of fiscal year 2018 enterprise planning guidance, but did not report any progress in using actual ROI data. Until such action is taken, IRS may not be allocating its resources in the most effective way, thus potentially forgoing additional revenues.
    Director: Asif A. Khan
    Phone: (202) 512-9869

    6 open recommendations
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should identify activity attributable to assessable units associated with service provider systems and business processes having a significant impact on the Army's SBR.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. In March 2015, Army officials indicated that the Army leveraged object class codes in its enterprise resource planning (ERP) systems to stratify business processes that have a significant impact on the Schedule of Budgetary Activity for fiscal year 2015 activity. The Army provided documentation supporting this effort; however, this documentation did not identify all activity attributable to assessable units associated with service provider systems and business processes having a significant impact on the Army's Statement of Budgetary Resources. In August 2016, we requested additional information from the Army. In November 2016, an Army representative indicated that the estimated timing for completing efforts to address this recommendation was the second quarter of 2017. We requested updates on the status of efforts to address this recommendation and as of August 2017, we have not received such an update.
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should coordinate efforts with service providers to obtain and document within memorandum of understanding memorandums of understanding a shared understanding of roles and responsibilities for processing Army data.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. The Army established a Mission Work Agreement (MWA) with Defense Finance and Accounting Service (DFAS), its most significant service provider, and documented concept of operations (CONOPS) regarding various business processes, such as civilian pay and Fund Balance with Treasury. However, the MWA and CONOPS did not include sufficient detail required to adequately understand roles and responsibilities for processing and reporting the Army's financial data. In January 2016, the Army indicated that it was developing a corrective action plan to formalize policies, procedures, and processes to assess third party providers that host or manage the Army's financial systems and data and will use this assessment to clarify its understanding of shared roles and responsibilities for processing Army data. According to the Army, this effort is expected to be completed the first quarter of fiscal year 2017. In August 2017 we requested an update on the status of efforts to address this recommendation from the Army point of contact.
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should completely and accurately document the linkage of financial reporting objectives to control activities.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. In June 2015, Army officials indicated that the Army's four financial reporting objectives (FROs) have not yet been linked to control activities. Army officials stated that the Army is continuing to analyze collection, disbursement, and Fund Balance with Treasury processes and anticipates linking these FROs to control activities based on these efforts. We requested updates on the status of efforts to address this recommendation and as of August 2017, we have not received such an update.
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should document criteria and processes for identifying key information technology systems that have a significant impact on the Army's SBR audit readiness.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. In March 2015, Army officials indicated that the Army was in the process of identifying IT systems with a significant impact on the Army's Statement of Budgetary Resources (SBR) audit readiness. Furthermore, Army officials stated that for the fiscal year 2015 Schedule of Budgetary Activity Audit, the independent public accountant was conducting walkthroughs and assessing information technology systems for significant impact on Army's SBR audit readiness. In August 2016, we requested an update on the status of efforts to address this recommendation. In November 2016, an Army representative indicated that efforts were completed and a list of the criteria and processes would be provided to us. Subsequently, we requested a status update and as of August 2017, we have not received such an update.
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should obtain and assess the results of service provider SSAE No. 16 examinations upon completion to determine the adequacy of internal controls and document complete end-to-end business processes.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. As of January 2016, Army officials indicated that the Army continued to assess SSAE 16 reports including complimentary controls and incorporating end-to-end business processes as applicable. According to the Army, the estimated completion date for these efforts was the fourth quarter of fiscal year 2016, which in November 2016, was revised to the second quarter of fiscal year 2017. We requested updates on the status of efforts to address this recommendation and as of August 2017, we have not received such an update.
    Recommendation: To improve the Army's implementation of the FIAR Guidance for its General Fund SBR FIP for budget execution and facilitate remaining efforts to achieve SBR auditability, the Assistant Secretary of the Army, Financial Management and Comptroller should correct significant deficiencies or material weaknesses identified before asserting audit readiness and engaging an IPA to validate the assertion.

    Agency: Department of Defense: Department of the Army: Office of the Assistant Secretary for Financial Management and Comptroller
    Status: Open

    Comments: The Army concurred with this recommendation. In March 2015, Army officials indicated that the Army was still working to resolve identified significant deficiencies and material weaknesses. In January 2016, Army officials indicated that the Army was assessing findings from an Independent Public Accountant in connection with its audit of Army's fiscal year 2015 Schedule of Budgetary Activity to identify deficiencies identified during previous audit readiness efforts. Repeat findings were incorporated into corrective action plans (CAP). According to the Army's January 8, 2016 CAP status report, estimated completion dates for addressing most of the findings identified were not yet determined. Since August 2016, we have requested updates on the status of efforts to address this recommendation and as of August 2017, we have not received such an update.
    Director: Malenich, J Lawrence
    Phone: (202) 512-3406

    2 open recommendations
    Recommendation: The CFPB should direct the Chief Financial Officer to design and implement control procedures that require coordination between the Office of Procurement and other program offices at the time of capitalization to ensure that property and equipment costs, including costs associated with internal-use software, are properly capitalized or expensed as appropriate.

    Agency: Consumer Financial Protection Bureau
    Status: Open

    Comments: Although CFPB took actions to attempt to address this recommendation, as of September 30, 2016, it was still in the process of implementing additional corrective actions. In addition, our fiscal year 2016 audit continued to identify deficiencies over the recording of property, equipment, and software costs. We will continue to evaluate CFPB's actions to address this recommendation during our fiscal year 2017 financial statement audit.
    Recommendation: The CFPB should direct the Chief Financial Officer to strengthen the design and implementation of control procedures to require, as part of the Office of the Chief Financial Officer's quarterly review procedures, review of underlying supporting documents, including tracking schedules, invoices, and obligating documents, to ensure that property and equipment transactions are properly identified and capitalized or expensed as appropriate.

    Agency: Consumer Financial Protection Bureau
    Status: Open

    Comments: As of September 30, 2016, we continued to find that the Office of the Chief Financial Officer's review was not always effective in timely detecting and correcting classification errors between costs that should be capitalized and costs that should be expensed. We will continue to evaluate CFPB's actions to address this recommendation during our fiscal year 2017 financial statement audit.
    Director: David Gootnick
    Phone: (202) 512-3149

    1 open recommendations
    including 1 priority recommendation
    Recommendation: To improve the agency's tracking and reporting on progress of its Local Solutions initiative, the USAID Administrator should identify additional indicators to better capture Local Solutions progress toward the initiative's goals.

    Agency: United States Agency for International Development
    Status: Open
    Priority recommendation

    Comments: As part of a three-tier approach to integrate more strategic monitoring efforts, USAID is conducting an internal review of the department's best practices, processes, and procedures for promoting the goals of the Local Solutions initiative, which are to strengthen capacity, promote ownership, and increase sustainability. Through this review, the agency expects to identify ways of monitoring the Local Solutions initiative that will more accurately capture the underlying models of change and help identify indicators that will help capture progress toward the initiative's goals. In October 2016, USAID officials said that the agency is in the process of developing a menu of potential indicators and will request missions to provide feedback on these indicators. Agency-wide indicators for local ownership are expected no sooner than spring of 2017. In April 2017, officials stated that the agency is working on finalizing draft indicators for local ownership. The expected date of completion is now late summer 2017.
    Director: Clark, Cheryl E
    Phone: (202) 512-9377

    3 open recommendations
    Recommendation: The Commission should direct the appropriate officials to establish and implement written policies and procedures requiring timely and continuous supervisory review of all financial transactions.

    Agency: American Battle Monuments Commission
    Status: Open

    Comments: In the Commission's fiscal year 2016 Independent Auditor's Report, the auditor reported that the Commission resolved the material weakness related to not effectively reviewing financial transactions to ensure that they were accurate, valid, complete, and recorded in the appropriate accounting period. We contacted the agency to ask for further information on the policy and process for supervisory review of financial transactions, but no response was received within the established deadline for us to conduct our follow up. Therefore, because we were not able to verify that related policies and procedures were established and implemented, we will follow up on this open recommendation at a later date.
    Recommendation: To improve its monitoring of internal control, the Commission should direct the appropriate officials to establish and implement written policies and procedures for planning and conducting the Commission's annual assessment of internal control over financial reporting as required by OMB A-123. The policies and procedures should include; (1) documenting an understanding of its internal control environment, which entails such elements as the tone at the top, ethical standards, and personnel management, which can have a significant effect on how the organization functions and the integrity of its financial accounting and reporting; (2) documenting its assessment of the risk of material misstatement to its financial statements; (3) establishing and documenting its internal control objectives and related internal control activities in place to meet those objectives; (4) documenting the tests to be performed and the results of each test, clearly identifying exceptions and resulting deficiencies; and (5) establishing a corrective action plan for all identified deficiencies that specifies how and when each deficiency will be corrected, and assigning responsibility for its effective and timely resolution.

    Agency: American Battle Monuments Commission
    Status: Open

    Comments: In the Commission's fiscal year 2016 Independent Auditor's Report, the auditor continued to report that the Commission did not have an adequate process for monitoring the design and operating effectiveness of its internal control to identify, evaluate, and correct internal control deficiencies. For example, the Commission did not document its OMB A-123 approach for assessing its internal control, or provide sufficient, appropriate evidence to support its conclusions on the effectiveness of its internal control activities. The Commission responded that it will continue to implement an enterprise-wide system of controls and monitor and report on those controls in compliance with FMFIA. During fiscal year 2017, the Commission informed us that they issued a related policy, however, their independent auditor continues to identify this area as a material weakness. Therefore, we will follow up on this open recommendation at a later date.
    Recommendation: To improve its monitoring of internal control, the Commission should direct the appropriate officials to establish and implement written policies and procedures for monitoring the activities of the external service organizations that perform significant aspects of the Commission's financial transaction processing and reporting, including implementing relevant complementary user entity controls identified by the service auditors.

    Agency: American Battle Monuments Commission
    Status: Open

    Comments: In the Commission's fiscal year 2015 Independent Auditor's Report, the auditor continued to report that the Commission did not adequately document and monitor the effectiveness of internal controls at the service organizations that performed significant aspects of its financial transaction processing and reporting, including processing its federal employee payroll transactions, reconciling its fund balance with Treasury, and preparing its annual financial statements. Specifically, ABMC did not evaluate the service organizations' service auditor reports that contained information on the service organizations' controls and the effectiveness of those controls, and did not consider the impact of the findings and conclusions contained in the service auditor reports on the effectiveness of its internal control. Further, ABMC did not design and implement appropriate complementary user entity controls that were identified by the service auditors. The Commission stated that it will continue to implement an enterprise-wide system of controls and monitor and report on those controls in compliance with FMFIA during fiscal year 2017. Therefore, we will follow up on this open recommendation at a later date.
    Director: Khan, Asif A
    Phone: (202) 512-9869

    2 open recommendations
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense, in his capacity as the Chief Management Officer and in consultation with the Under Secretary of Defense (Comptroller), to design and implement department-level policies and detailed procedures for FIAR Plan risk management that incorporate the five guiding principles for effective risk management. The following are examples of key features of each of the guiding principles that DOD should, at a minimum, address in its policies and procedures. (1) Identify risks. Generate a comprehensive and continuously updated list of risks that includes the root cause of each risk, audit area(s) each risk will affect, and the potential consequences if a risk is not effectively mitigated. (2) Analyze risks. Consult with key stakeholders, including program managers; use analytical techniques, such as risk categorization, risk urgency assessment, or sensitivity analysis; and determine the impact of the identified risks on individual DOD components' abilities to achieve audit readiness. (3) Plan for risk mitigation. Assign responsibility or ownership of the risk mitigation actions, define roles and responsibilities in executing mitigation plans, establish deadlines or milestones for individual mitigation actions, and estimate resource needs. (4) Implement risk mitigation plan. Document the implementation of mitigation actions, develop appropriate metrics that allow for tracking of progress, and validate reported metrics. (5) Monitor risks. Track identified risks and assess the effectiveness of implemented mitigation actions on a continuous basis, including identifying and planning for new risks.

    Agency: Department of Defense
    Status: Open

    Comments: DOD partially concurred with our recommendation. While DOD did concur with our assessment that they did not have a risk management policy and procedures related to implementing the FIAR guidance. They did not concur with our assessment of the overall environment of DOD's risk management of the FIAR initiative. DOD has taken steps to address our recommendation including implementing an NFR tracker and standard operating procedures designed to track DOD component material weaknesses. DOD has also documented a critical path and milestones in Appendix F of their FIAR Guidance; military component tasks and milestones in appendix G of the FIAR Guidance; and audit readiness deal breakers, now referred to as critical capabilities. However, while these are positive actions, they do not address our recommendation for DOD to implement risk management policies and procedures for FIAR implementation. Further, DOD has not provided GAO with evidence of planned actions it summarized in its agency comments. Specifically, DOD has not provided documentation related to (1) improving risk management documentation, (2) reinstating the DOD probability and impact matrix, and (3) re-evaluation of metrics to monitor progress and risk of audit readiness. Lastly, DOD's tracking of military component material weaknesses does not identify risks to audit readiness, or the agencies capabilities to manage risks to audit readiness. According to the May 2017 FIAR Status Update for the HASC Panel Recommendations, DOD has reinforced the importance of internal controls over areas of significant risk by updating the FIAR Guidance with a new chapter dedicated to internal controls. DOD has also changed how they respond to recommendation follow-up by way of the Washington Headquarters Service (WHS). We are currently waiting for a POC to be assigned. We will continue to evaluate the status of actions to address this recommendation.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense, in his capacity as the Chief Management Officer and in consultation with the Under Secretary of Defense (Comptroller), to consider and incorporate, as appropriate, the Navy's and DLA's risk management practices in department-level policies and procedures.

    Agency: Department of Defense
    Status: Open

    Comments: DOD has changed how they respond to recommendation follow-up by way of the Washington Headquarters Service (WHS). We are currently waiting for a POC to be assigned. We will continue to evaluate the status of actions to address this recommendation.
    Director: Engel, Gary T
    Phone: (202)512-8815

    2 open recommendations
    including 2 priority recommendations
    Recommendation: To improve the reliability of the information presented in the CFS budget statements, the Secretary of the Treasury should direct the Fiscal Assistant Secretary, working in coordination with the Controller of OMB's Office of Federal Financial Management, to establish and implement effective procedures for reporting amounts in the CFS budget statements that are fully consistent with the underlying information in significant federal entities' audited financial statements and other financial data.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury partnered with the Federal Accounting Standards Advisory Board (FASAB) to develop a Statement of Federal Financial Accounting Standards exposure draft that identifies items needed to reconcile net cost to outlays at the entity level, with a focus on demonstrating consistency with significant entities' audited financial statements. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Recommendation: To improve the reliability of the information presented in the CFS budget statements, the Secretary of the Treasury should direct the Fiscal Assistant Secretary, working in coordination with the Controller of OMB's Office of Federal Financial Management, to establish and implement effective procedures for identifying and reporting all items needed to prepare the CFS budget statements.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury has improved its process for preparing the budget statements over the past three years and is continuing to do so. For example, Treasury has developed a reconciliation process to ensure that all cash related amounts reconcile on a monthly basis. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Director: St James, Lorelei
    Phone: (202) 512-2834

    1 open recommendations
    Recommendation: Because USPS faces a deteriorating financial situation, and to help ensure that future promotions generate net revenue for USPS, the Chairman of the PRC should direct staff to evaluate USPS's data collection and analysis plans for USPS's proposed mail promotions and discuss these evaluations in the PRC decisions for those mail promotions.

    Agency: Postal Regulatory Commission
    Status: Open

    Comments: The Postal Regulatory Commission (PRC) said that it agreed with our recommendation. PRC has also noted the U.S. Postal Service (USPS) is not required by statute to collect data on promotions and provide it to PRC. Based on the information it received, PRC approved USPS's Calendar Year 2017 promotions. However, USPS did not provide PRC with information regarding its plans to estimate the net financial results of the proposed promotions, as we recommended. As no such information was received, no evaluation of these plans was prepared by PRC, and this recommendation remains open.
    Director: Czerwinski, Stanley J
    Phone: (202) 512-6806

    3 open recommendations
    including 3 priority recommendations
    Recommendation: The Director of OMB should, in collaboration with the members of COFAR, develop and make publicly available an implementation schedule that includes performance targets, goal leaders who can be held accountable for each goal, and mechanisms to monitor, evaluate, and report on results.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: In January 2017, GAO reported that although COFAR had released its updated priorities for Fiscal Years 2016 through 2017, it had not released to the public an implementation schedule that included key elements such as performance targets, mechanisms to monitor, evaluate, and report on progress made toward its stated priorities. For this reason, this recommendation remains open.
    Recommendation: The Director of OMB should, in collaboration with the members of COFAR, clarify the roles and responsibilities for various streamlining initiatives and steps for decision making, in particular how COFAR will engage with relevant grant-making agency stakeholders and utilize agency resources.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: In January 2017, GAO reported that although COFAR had released its updated priorities for Fiscal Years 2016 through 2017, the document did not provide clarification on roles and responsibilities for its members. For this reason, this recommendation remains open.
    Recommendation: The Director of OMB should, in collaboration with the members of COFAR, improve efforts to develop an effective two-way communication strategy that includes the grant recipient community, smaller grantmaking agencies that are not members of COFAR, and other entities involved with grants management policy.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: In January 2017, GAO reported that although COFAR had released its updated priorities for Fiscal Years 2016 through 2017, the document did not provide a detailed communication strategy for the grant recipient community. For this reason, this recommendation remains open.
    Director: Clark, Cheryl E
    Phone: (202)512-9377

    3 open recommendations
    Recommendation: The Acting Commissioner of Internal Revenue should direct the appropriate IRS officials to perform a risk assessment to determine the appropriate level of Integrated Data Retrieval System (IDRS) access that should be granted to employee groups that handle hard-copy taxpayer receipts and related sensitive taxpayer information as part of their job responsibilities.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: According to IRS, a risk assessment was performed to determine the appropriate level of IDRS access that should be granted to employee groups that handle hard-copy taxpayer receipts and related sensitive taxpayer information as part of their job responsibilities. However, during our fiscal year 2016 audit, we identified a group of employees at an SCC who handle hard-copy taxpayer receipts and related sensitive taxpayer information and can make adjustments to taxpayer accounts. Based on the information obtained, it is unclear whether the risks associated with these employees were considered in a risk assessment. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The Acting Commissioner of Internal Revenue should direct the appropriate IRS officials to, based on the results of the risk assessment, update the Internal Revenue Manual (IRM) accordingly to specify the appropriate level of IDRS access that should be allowed for (1) remittance perfection technicians and (2) all other employee groups with IDRS access that handle hard-copy taxpayer receipts and related sensitive information as part of their job responsibilities.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: As a result of its risk assessment efforts thus far, IRS updated the IRM to restrict the use of certain IDRS command codes for remittance perfection technicians. In addition, in May 2016, IRS reassessed the risks at its TACs, including the specific risks and mitigating factors associated with allowing TAC employees to process taxpayer remittances and to adjust taxpayer accounts. However, IRS did not update the IRM to reflect the conclusions from the risk assessment related to TAC employees. Further, during our fiscal year 2016 audit, we identified a group of employees at an SCC who handle hard-copy taxpayer receipts and related sensitive taxpayer information and can make adjustments to taxpayer accounts. Based on the information obtained, it is unclear whether the risks associated with these employees were considered in a risk assessment. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Recommendation: The Acting Commissioner of Internal Revenue should direct the appropriate IRS officials to establish procedures to implement the updated IRM, including required steps to follow to prevent (1) remittance perfection technicians and (2) all other employee groups that handle hard-copy taxpayer receipts and related sensitive information as part of their job responsibilities from gaining access to command codes not required as part of their designated job duties.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: As a result of its risk assessment efforts thus far, IRS updated the IRM to include procedures to restrict the use of certain IDRS command codes for remittance perfection technicians. However, the IRM has not been updated based on the results of the risk assessment related to TAC employees and, if applicable, other employees who have access to sensitive command codes and handle hard-copy taxpayer receipts and related sensitive information as part of their job duties. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Director: Khan, Asif A
    Phone: (202)512-9869

    9 open recommendations
    including 9 priority recommendations
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to estimating improper payments, to establish and implement key quality assurance procedures, such as reconciliations, to ensure the completeness and accuracy of the sampled populations.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: The Department of Defense (DOD), in concurring with this recommendation, stated that the Department will work with the Defense Finance and Accounting Service (DFAS) to implement key quality assurance procedures, such as reconciliations, to ensure the completeness and accuracy of sampled populations. In June 2016, DOD officials stated that while the department is moving toward full auditability of its financial statements, the capability to ensure the completeness and accuracy of the sampled populations is still under development. As of August 31, 2017, DOD's efforts in this area were ongoing.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to estimating improper payments, to revise the procedures documented in DOD's sampling methodologies so that they (1) are in accordance with OMB guidance and generally accepted statistical standards and (2) produce statistically valid improper payment error rates, statistically valid improper payment dollar estimates, and appropriate confidence intervals for both. At a minimum, such procedures should take into account the size and complexity of the transactions being sampled.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: The Department of Defense (DOD) partially concurred with this recommendation, stating that sampling methodologies would be reviewed for all payment types and would be modified as appropriate to produce valid improper payment estimates and appropriate confidence intervals for them. In its May 2016 FIAR Plan Status Report, DOD officials stated that the department is reviewing the methodologies associated with identifying improper payments for seven improper payment programs, and if warranted, will change their sampling plans (methodologies). These seven programs are: Defense Finance and Accounting Service's Military Pay, Civilian Pay, Military Retirement, and Travel Pay; U.S. Corps of Engineers' Commercial Pay and Travel Pay; and Navy ERP commercial payments. In June 2016, DOD officials stated that the Office of the Under Secretary of Defense (Comptroller) will continue to coordinate with those DOD components currently using simple random sample designs, to develop methodologies that are stratified by an appropriate variable, such as an invoice or payment amount based on appropriate confidence intervals. As of August 31, 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to identifying programs susceptible to significant improper payments, to conduct a risk assessment that is in compliance with IPERA.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: The Department of Defense (DOD), in concurring with this recommendation, stated that it would work collaboratively with the applicable Defense components to develop a framework to conduct a risk assessment that is in compliance with the Improper Payments Elimination and Recovery Act (IPERA). Risk assessments for six DOD programs (military health benefits, military pay, civilian pay, Defense Finance and Accounting Service (DFAS) travel pay, retiree & annuitant pay, and DFAS commercial pay) complied with IPERA requirements based on documentation provided to support them. However, based on our review of documentation provided by the U.S. Army Corps of Engineers (USACE), risk assessments for the two programs it administers (USACE travel pay and USACE commercial pay) have not been performed. DOD officials stated that the risk assessment documentation for the two USACE programs is under development. In October 2016, DOD issued a remediation plan for travel pay improper payments and recovery. As of August 31 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to reducing improper payments, to establish procedures that produce corrective action plans that comply fully with IPERA and OMB implementation guidance, including at a minimum, holding individuals responsible for implementing corrective actions and monitoring the status of the corrective actions.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: The Department of Defense, in concurring with this recommendation, stated that it would work collaboratively with applicable components to establish procedures that produce corrective action plans that fully comply with the Improper Payment Elimination and Recovery Act and Office of Management and Budget (OMB) guidance. According to DOD officials, these established procedures will include individual accountability for implementing corrective actions and monitoring the status of corrective actions. As of June 2016, DOD officials told us that department enters corrective actions plans associated with audit findings into a notice of findings and recommendations (NFR) database developed to track their status and progress. The database was deployed in May 2016. According to DOD's fiscal year 2015 Agency Financial Report, DOD's travel pay had the highest error rate among all DOD-reported improper payment programs, and therefore DOD would place its initial focus to achieve measurable progress more quickly in this area. In June 2016, DOD officials stated that the Office of the Under Secretary of Defense (Comptroller) (OUSD(C)) would revise and expand the DOD Travel Remediation Plan into a more comprehensive plan which includes establishing Senior Accountable Officials (SAOs) within each military service. OUSD(C) will collaborate with each SAO to ensure the development of standardized procedures and corrective action plans to include training, root cause identification, and quality assurance goals that comply with improper payment law and regulatory guidance. On October 7, 2016, DOD issued its remediation plan entitled "Preventing Travel Pay Improper Payments and Recovery." The remediation plan notes two primary causes of improper travel payments; each of which highlights the need for increased detail (documentation), attention to detail (accuracy), and a more regular and effective training regimen. The remediation plan includes several requirements that must be met to reinforce internal controls and accountability. Beginning in fiscal year 2017, the DOD Comptroller and component SAOs are to receive travel pay metrics reports to measure progress. The first report is intended to establish a baseline. As of April 2017, DOD officials stated that there are corrective action plans, but the implementation of these plans needs to be assigned to the individual level components. As of August 31, 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to reducing improper payments, to establish procedures that produce corrective action plans that are in accordance with best practices, such as those recommended by the Chief Financial Officers Council (CFOC), and include (1) measuring the progress made toward remediating root causes and (2) communicating to agency leaders and key stakeholders the progress made toward remediating the root causes of improper payments.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: The Department of Defense (DOD), in concurring with this recommendation, stated that it would work collaboratively with the applicable components to establish procedures that produce corrective action plans that incorporate best practices, including those recommended by the Chief Financial Officers Council. DOD's corrective action plans would include information on (1) measuring the progress made toward remediating root causes and (2) communicating to agency leaders and key stakeholders the progress made toward remediating the root causes of improper payments. In June 2016, DOD officials told us that department enters corrective actions plans associated with audit findings into a notice of findings and recommendations (NFR) database developed to track their status and progress. The database was deployed in May 2016. According to DOD's fiscal year 2015 Agency Financial Report, DOD's travel pay had the highest error rate among all DOD-reported improper payment programs, and therefore DOD would place its initial focus to achieve measurable progress more quickly in this area. In June 2016, DOD officials stated that the Office of the Under Secretary of Defense (Comptroller) (OUSD(C)) will revise and expand the DOD Travel Remediation Plan into a more comprehensive plan which will include establishing Senior Accountable Officials (SAOs) within each military service. OUSD(C) will collaborate with each SAO to ensure the development of standardized procedures and corrective action plans to include training, root cause identification, and quality assurance goals that comply with improper payment law and regulatory guidance. On October 7, 2016, DOD issued its corrective/remediation plan entitled "Preventing Travel Pay Improper Payments and Recovery." We plan to review this plan for consistency with OMB and IPERA guidelines. In April 2017, we learned that the Office of Management and Budget had done an assessment of this plan and provided helpful suggestions. As of August 31, 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to implementing recovery audits, to develop and implement procedures to (1) identify costs related to the department's recovery audits and existing recovery efforts and (2) evaluate existing improper payment recovery efforts to ensure that they are cost effective.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: Department of Defense (DOD) officials concurred with this recommendation, stating that the DOD would review its procedures for improper payment recovery activities to ensure currency and accuracy and that it would also perform analyses to ensure that its recovery efforts are cost-effective. In July 2015, DOD reported that the development of cost estimates for recovery auditing was ongoing. In addition, DOD officials indicated that only the United States Army Corps of Engineers (USACE) has developed an analysis to evaluate the cost effectiveness of performing recovery audits. As of April 2017, DOD's efforts to develop cost-estimates for recovery audits were still under way. As of August 31, 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to implementing recovery audits, to monitor the implementation of the revised FMR chapter on recovery audits to ensure that the components either develop recovery audits or demonstrate that it is not cost effective to do so.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: Department of Defense (DOD) officials, in concurring with this recommendation, stated that DOD would work with the applicable components to monitor the implementation of the revised Financial Management Regulation (FMR) chapter on recovery audits. According to DOD officials, this action would help to ensure that recovery audits are developed, or will demonstrate that it is not cost-effective to do these audits. In July 2015, DOD was working to update the FMR chapter on recovery audits to reflect revised Office of Management and Budget (OMB) guidance issued in October 2014. DOD issued its revised FMR chapter in November 2015. This chapter requires components to develop cost-effective payment recapture audits or to submit a quantitative justification to the Office of the Under Secretary (Comptroller) for approval. However, we consider this recommendation to be open because DOD did not provide documentation demonstrating that the Office of the Under Secretary of Defense (Comptroller) is monitoring component implementation of recovery auditing. Further, as of April 2017, DOD's efforts to develop cost-estimates for recovery audits were still under way. As of August 31, 2017, this recommendation was still open.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to implementing recovery audits, to develop and submit to OMB for approval a payment recapture audit plan that fully complies with OMB guidance.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: Department of Defense (DOD) officials, in concurring with this recommendation, stated that DOD would develop and submit to the Office of Management and Budget (OMB) a payment recapture plan that fully complies with OMB guidance and is informed by a cost-effectiveness analysis. In July 2015, DOD's Office of the Under Secretary of Defense (Comptroller) efforts to develop a payment recapture audit plan to ensure cost-effectiveness were ongoing and these efforts must be completed before a plan can be submitted to the OMB. In June 2016, DOD officials stated that the Comptroller's efforts to develop a payment recapture audit plan to ensure cost-effectiveness were ongoing. As of August 31,2017, the department's efforts to implement this recommendation are continuing.
    Recommendation: The Secretary of Defense should direct the Under Secretary of Defense (Comptroller), with regard to reporting, to design and implement procedures to ensure that the department's annual improper payment and recovery audit reporting is complete, accurate, and in compliance with IPERA and OMB guidance.

    Agency: Department of Defense
    Status: Open
    Priority recommendation

    Comments: Department of Defense (DOD) officials, in concurring with this recommendation, stated that DOD would design and implement procedures to further ensure that its annual improper payment and recovery audit reporting is complete, accurate, and in compliance with the Improper Payments Elimination and Recovery Act (IPERA) requirements and Office of Management and Budget (OMB) guidance. In June 2015, DOD revised its FMR chapter on improper payments to require components to provide information needed to report on improper payment and recovery audit activities in its annual financial report (AFR) in accordance with IPERA requirements and OMB guidance. DOD's fiscal year 2015 AFR reflected its implementation of the revised FMR. We found that DOD's improper payment reporting in its fiscal year 2015 AFR had improved. However, we were not provided with evidence that Office of the Under Secretary of Defense (Comptroller) is performing oversight and monitoring activities to ensure the accuracy and completeness of the improper payment and recovery audit data submitted by DOD components for inclusion in the AFR. As of April 2017, DOD is continuing to work on procedures for ensuring that its reporting on improper payment and recovery audits is accurate, complete, and in compliance with IPERA and OMB guidance. As of August 31, 2017, this recommendation was still open.
    Director: Khan, Asif A
    Phone: (202) 512-9869

    5 open recommendations
    Recommendation: To strengthen the design of controls over active duty Army military payroll, and to assure the effectiveness of the UCFR process as a compensating control for confirming the accuracy of its military pay, the Secretary of Defense should direct the Secretary of the Army to revise AR 37-104-4, Military Pay and Allowances Policy, to establish a requirement for periodic monitoring of the effectiveness of unit commander UCFR reviews.

    Agency: Department of Defense
    Status: Open

    Comments: In June 2013, DOD and Army officials told us that the Army and Defense Finance and Accounting Service (DFAS) performed an analysis of the effectiveness of the Unit Commander Finance Report (UCFR) in preventing payroll errors. The officials shared a February 21, 2013, Army memo on the results of the analysis, which indicated that while the UCFR was an effective tool as a snapshot of a Soldier's pay, it was not comprehensive enough to provide the level of detail needed to manage many pay entitlements. Additionally, analytical results showed that in most cases, having units certify and return UCFRs to the Finance Office did not result in corrective action in the month the condition requiring action first appeared on the report. The officials told us the Army intends to rely on existing primary controls over pay transactions and the implementation of the Integrated Personnel and Pay System-Army (IPPS-A), which was targeted for implementation in 2017, to address the issues we reported rather than revising AR-37-104-4 to require certification of the UCFR and its return to the Finance Office. The Army concluded that if used properly, the UCFR could provide a secondary control for units to identify a limited number of pay discrepancies. The Army's Finance Command Director subsequently told us that because the analysis showed that the UCFR was not being used as an effective tool by unit commanders, the Army would continue to pursue methods to improve pay transaction timeliness through training and command awareness efforts, to include use of the UCFR, pending implementation of IPPS-A. For example, the Army expanded the list of entitlements that, similar to UCFRs, are sent to commands for review and increased the frequency of the command reviews. The Army also implemented a process for monitoring high-risk special pays that have an anniversary date, such as Foreign Language Proficiency Bonus, Basic Allowance for Housing, and Basic Allowance for Subsistence, and confirming that the certifications have not expired. However, DOD's May 2017 FIAR Plan Status Report showed that the Army's IPPS-A is not expected to be fully implemented until April 2020. We will continue to assess DOD's efforts to address this recommendation.
    Recommendation: To strengthen the design of controls over active duty Army military payroll, and to assure the effectiveness of the UCFR process as a compensating control for confirming the accuracy of its military pay, the Secretary of Defense should direct the Secretary of the Army to revise AR 37-104-4, Military Pay and Allowances Policy, to require unit commanders to review and submit documentation showing completion of all monthly UCFR reviews.

    Agency: Department of Defense
    Status: Open

    Comments: In June 2013, DOD and Army officials told us that the Army and Defense Finance and Accounting Service (DFAS) performed an analysis of the effectiveness of the Unit Commander Finance Report (UCFR) in preventing late transactions for updating pay. The results of an Army analysis showed that units certifying and returning UCFRs to the Finance Office did not increase timely corrective actions being taken to a soldier's pay. In a memo dated Feb. 21, 2013, the Army stated, "Creating a mandatory process of requiring Commanders to certify and return the UCFR (even when there are no errors) imposes additional administrative requirements and associated costs on the unit, the Finance Office and DFAS." The memo further stated that, based on the sample taken, most units are already certifying UCFRs and returning them to Finance -- with little impact on Soldiers' pay." Army officials told us that based on the Feb. 21, 2013, memo and subsequent follow up, the Army intended to rely on existing primary controls over pay transactions and the implementation of the Integrated Personnel and Pay System-Army (IPPS-A) targeted for August 2017 to address the issues we reported, rather than revise AR-37-104-4 to require certification of the UCFR and its return to the Finance Office. Army officials told us they would continue to pursue methods to improve pay transaction timeliness through training and command awareness efforts, to include use of the UCFR. The Army stated that the development and fielding of IPPS-A offers opportunities for reducing errors and manual inputs, while providing improved transaction timeliness and pay accuracy. However, DOD's May 2017 FIAR Plan Status Report showed that the Army's IPPS-A is not expected to be fully implemented until April 2020. We will continue to assess DOD's efforts to address this recommendation.
    Recommendation: To strengthen the design of controls over active duty Army military payroll, and to assure the effectiveness of the UCFR process as a compensating control for confirming the accuracy of its military pay, the Secretary of Defense should direct the Secretary of the Army to revise AR 37-104-4, Military Pay and Allowances Policy, to specify the time frame for submitting UCFRs, such as no later than the 10th of the month.

    Agency: Department of Defense
    Status: Open

    Comments: In a Feb. 21, 2013 memo, the Army stated that its regulations require units to take immediate action when an error is discovered during a review of an Unit Commander Finance Report (UCFR). According to the Army, specifying a timeframe for the review and submission of UCFRs, such as 10 days, would also require the development of additional controls and monitoring procedures and create exceptions/waivers for those units deployed or on training exercises. As a result, the Army intended to rely on existing primary controls over pay transactions and the targeted implementation of the Integrated Personnel and Pay System-Army (IPPS-A) in August 2017 to address the issues, rather than revise AR-37-104-4. With the slippage in implementation of IPPS-A integrated military personnel and pay functionality to April 2020, the Army needs to reconsider our recommendation along with reasonable timeline accommodations for deployed units. We will continue to assess the Army's efforts to address this recommendation.
    Recommendation: To strengthen the design of controls over active duty Army military payroll, and to provide a means for monitoring the overall accuracy of the Army's military payroll, the Secretary of Defense should direct the DOD Comptroller to require DFAS-IN to develop criteria and establish a comprehensive metric to capture and measure all types of pay errors affecting accuracy.

    Agency: Department of Defense
    Status: Open

    Comments: In June 2013, the Defense Finance and Accounting Service (DFAS)-Indianapolis Director told us that DFAS conducted a gap analysis for two installations (Ft. Carson and Ft. Gordon). This analysis compared data on the effective date of pay impacting transactions (e.g., Basic Allowance for Housing, Foreign Language Proficiency Pay, etc.); the date transactions were entered into the pay system; the elapsed time in days from the effective date through each step of the process to the date pay was input to the military pay system. The Army's analysis concluded that most errors that occurred were due to units' late submissions of source documents. The Army's position is that the key metric for military pay accuracy is the timeliness of processing of pay impacting transactions. The Army intended to rely on the targeted August 2017 implementation of the Integrated Personnel and Pay System-Army (IPPS-A) to address pay transaction timeliness and address any other identified issues rather than require DFAS-Indianapolis to develop additional criteria and metrics within the current systems environment to measure all types of conditions affecting accuracy. However, DOD's May 2017 FIAR Plan Status Report showed that the Army's IPPS-A is not expected to be fully implemented until April 2020. We will continue to assess DOD's efforts to address this recommendation.
    Recommendation: To strengthen the design of controls over active duty Army military payroll, and to provide a means for monitoring the overall accuracy of the Army's military payroll, the Secretary of Defense should direct the Department of Defense (DOD) Comptroller to require DFAS-IN to establish an interim mechanism at DFAS-IN for identifying and analyzing the extent and causes of all types of military payroll errors processed by Defense Military Pay Offices (DMPOs), Army Finance Offices, Defense Joint Military Pay System-Active Component (DJMS-AC), and Case Management System (CMS) to address any systemic control weaknesses.

    Agency: Department of Defense
    Status: Open

    Comments: In June 2013, DOD and Army officials stated that DFAS, as part of its pre-assertion audit readiness efforts for the Military Pay Statement on Standards for Attestation Engagements (SSAE) No. 16, Reporting on Controls at a Service Organization examination, has identified and validated many controls over the completeness, accuracy and validity of military pay. This included identifying gaps in internal controls and developing and implementing corrective action plans to mitigate any gaps. The Army subsequently engaged another independent public accounting firm to assess its audit readiness for the Statement of Budgetary Resources, including audit readiness for its military pay. In addition, the Army underwent an audit of its fiscal year 2015 General Fund Schedule of Budgetary Activity. Both audit engagements identified military pay issues requiring corrective action. Most recently, the audit of the Army's fiscal year 2016 Budgetary Schedule resulted in a disclaimer of opinion, in part, due to the Army's inability to produce a complete and accurate population of accession, separation, promotion/reduction, special pay, and leave populations for Active Duty, Reserve, and Guard soldiers. In January 2016, the Army auditor reported that "without the ability to produce complete populations, the risk exists that a soldier is improperly accessed, separated, promoted/reduced, awarded special pay, and/or had his or her leave account adjusted incorrectly. Further, the Army's ability to identify and correct any errors is significantly reduced, potentially misstating payroll obligations and outlays reported on the schedule." Army officials stated that it intends to rely on its current transaction timeliness metrics, pre-payment statistical sampling, Improper Payment Elimination and Reporting Act (IPERA) reporting, and eventually implementation of the Integrated Personnel and Pay System - Army (IPPS-A) to address the issues regarding completeness, accuracy, and validity of military pay. However, DOD's May 2017 FIAR Plan Status Report showed that the Army's IPPS-A is not expected to be fully implemented until April 2020. Therefore, we believe that the Army needs to revisit our recommendation and establish an interim mechanism for identifying and analyzing the extent and causes of military payroll errors and take appropriate action to address any systemic control weaknesses. We will continue to assess the Army's efforts to address this recommendation.
    Director: King, Kathleen M
    Phone: (202) 512-7114

    1 open recommendations
    including 1 priority recommendation
    Recommendation: In order to promote greater use of effective prepayment edits and better ensure proper payment, and to promote implementation of effective edits based on national policies, the CMS Administrator should develop written procedures to provide guidance to agency staff on all steps in the processes for developing and implementing edits based on national policies, including (1) time frames for taking corrective actions, (2) methods for assessing the effects of corrective actions, and (3) procedures for ensuring consideration of automated edits whenever possible, including for all existing NCDs and other national policies.

    Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
    Status: Open
    Priority recommendation

    Comments: HHS concurred with this recommendation. CMS developed written procedures in November 2012 to provide guidance to agency staff on procedures for ensuring consideration of automated edits whenever possible, as GAO recommended in November 2012, but these procedures do not include several key elements of GAO's recommendation. For example, the written procedures do not include time frames for making decisions on whether an edit will be developed for all existing National Coverage Determinations (NCD) and national policies. The written procedures also do not include requirements for methods to assess the effects of corrective actions taken. Implementing a comprehensive written process for developing edits for national policies could help ensure that edits are implemented whenever possible to reduce improper payments. As of September 2017, CMS had not provided us updated documentation that addressed these aspects of our recommendation. Once received, we will review the information and update this recommendation accordingly.
    Director: Powner, David A
    Phone: (202) 512-9286

    5 open recommendations
    including 1 priority recommendation
    Recommendation: To ensure that major steady state IT investments are being adequately analyzed, the Secretaries of Defense, Veterans Affairs, and the Treasury should direct appropriate officials to develop an OA policy, annually perform OAs on all investments, and ensure the assessments include all key factors.

    Agency: Department of Defense
    Status: Open

    Comments: DOD has stated it is developing OA policy, but has yet to provide a timeframe for when it will be completed. In addition, we are waiting for fiscal year 2016 OAs.
    Recommendation: To ensure that major steady state IT investments are being adequately analyzed, the Secretaries of Defense, Veterans Affairs, and the Treasury should direct appropriate officials to develop an OA policy, annually perform OAs on all investments, and ensure the assessments include all key factors.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: The Department of Treasury has developed an OA policy and is currently performing OAs on investments. However, we are waiting for fiscal year 2016 investment OAs to determine if all key factors are being met.
    Recommendation: To ensure that major steady state IT investments are being adequately analyzed, the Secretaries of Defense, Veterans Affairs, and the Treasury should direct appropriate officials to develop an OA policy, annually perform OAs on all investments, and ensure the assessments include all key factors.

    Agency: Department of Veterans Affairs
    Status: Open

    Comments: We are waiting for VA to provide its finalized OA policy and for fiscal year 2016 OAs.
    Recommendation: The Secretaries of Homeland Security and Health and Human Services should direct their Chief Information Officers to ensure OAs are performed annually on all major steady state investments and the assessments include all key factors.

    Agency: Department of Homeland Security
    Status: Open

    Comments: The Department of Homeland Security has updated their OA policy and is currently performing OAs on investments. We received fiscal year 2016 OAs for CBP but are waiting for the rest of the departments OAs for FY2016.
    Recommendation: The Secretaries of Homeland Security and Health and Human Services should direct their Chief Information Officers to ensure OAs are performed annually on all major steady state investments and the assessments include all key factors.

    Agency: Department of Health and Human Services
    Status: Open

    Comments: We are waiting for HHS's fiscal year 2016 OAs.
    Director: Clark, Cheryl E
    Phone: (202)512-3000

    1 open recommendations
    Recommendation: The Commissioner of the Internal Revenue Service should direct the appropriate IRS officials to update the Internal Revenue Manual (IRM) to specify steps to be followed to prevent campus support clerks as well as any other employees who process payments through the electronic check presentment system from making adjustments to taxpayer accounts.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: During fiscal year 2012, IRS updated the IRM to require managers to verify that all campus support employees who process payments through the electronic check presentment system have the appropriate command code restriction in their IDRS profiles to prevent them from making adjustments to taxpayer accounts. However, during our subsequent audits we found that in updating the IRM, IRS did not undertake a global review of the level of access provided to all employee groups who handle hard-copy taxpayer receipts and related sensitive information to ensure that their levels of IDRS access were appropriate. As a result, in May 2016, IRS reassessed the risks at its TACs, including the specific risks and mitigating factors associated with allowing TAC employees to process taxpayer remittances through the electronic check presentment system and to adjust taxpayer accounts. However, IRS did not update the IRM to reflect the conclusions from the risk assessment related to TAC employees needing access to certain sensitive command codes as part of their normal job duties. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Director: Goldenkoff, Robert N
    Phone: (202)512-3000

    2 open recommendations
    including 2 priority recommendations
    Recommendation: To improve the Bureau's process of organizational transformation, long-term planning, and strategic workforce planning for the 2020 Census, and thus better position the Bureau to carry out a cost-effective decennial census, the Secretary of Commerce should require the Under Secretary for Economic Affairs who oversees the Economics and Statistics Administration, as well as the Director of the U.S. Census Bureau to, in order to ensure prioritization and timely completion of all necessary research and testing efforts, as well as timely transition to later 2020 Census phases, develop and implement a long-term planning schedule that includes key milestones and deadlines, including (1) deadlines for decisions that directly affect activity in later 2020 Census phases; (2) a schedule for creating, revising, or updating governance, program management, and system engineering and architecture plans to be used in later 2020 Census phases beyond research and testing; and (3) expected times of delivery for Bureau-wide enterprise tools, processes, and standards that 2020 Census planning would be expected to use.

    Agency: Department of Commerce
    Status: Open
    Priority recommendation

    Comments: Commerce agreed with this recommendation. Bureau officials released an operational plan in November 2015, including a high-level timeline for much of the remaining activity, but final schedules of delivery for Bureau-wide enterprise tools, processes, and standards are being revised and are not yet complete. In June 2016, officials announced that the Bureau would finalize its updated schedule in July 2016. To fully implement this recommendation, the Bureau needs to finalize program management and other governance documents applicable to the current and later phases of the decennial lifecycle, as well as finalizing schedules for delivery of Bureau-wide enterprise tools, processes, and standards. As of July 2017, Bureau officials reported they were working to provide artifacts they believe may address this recommendation.
    Recommendation: To improve the Bureau's process of organizational transformation, long-term planning, and strategic workforce planning for the 2020 Census, and thus better position the Bureau to carry out a cost-effective decennial census, the Secretary of Commerce should require the Under Secretary for Economic Affairs who oversees the Economics and Statistics Administration, as well as the Director of the U.S. Census Bureau to, in order to improve the Bureau's process for following up on Bureau and oversight agencies' recommendations to improve the 2020 Census, (1) assess the status of recommendation follow-up at regular intervals, such as every 12 months; and (2) periodically report on the status of recommendation follow-up--such as on the Bureau's intranet or Internet pages.

    Agency: Department of Commerce
    Status: Open
    Priority recommendation

    Comments: Commerce agreed with this recommendation. The Bureau assigns outstanding recommendations from GAO and others within the Bureau's knowledge management database to various leads, such as specific 2020 Census research and testing project teams. The Bureau regularly collates status updates on our open recommendations as well as the Office of Inspector General for reporting to department officials. The Bureau has begun quarterly meetings with us to discuss open GAO recommendations. When the status of its own internal recommendations -- such as from evaluations of its earlier tests -- is more visible inside and outside the Bureau, the Bureau's knowledge management will be better positioned to help the Bureau achieve goals of a cost-effective census. To fully implement this recommendation, the Bureau needs to implement mechanisms to capture lessons learned from its ongoing research and testing experience for recommendations in its database, and periodically report on the status of all open recommendations. As of July 2017, the Bureau is actively collecting artifacts, but has not yet provided evidence of either regular or open reporting on the status of other recommendations, such as from its own prior evaluations, ongoing tests, or the National Academy of Sciences.
    Director: Merritt, Zina Dache
    Phone: (202) 512-5257

    4 open recommendations
    Recommendation: To complete its implementation and management framework for IUID by incorporating key elements of a comprehensive management approach, such as a complete analysis of the return on investment, quantitatively-defined goals, and metrics for measuring progress, the Secretary of Defense should direct the Under Secretary of Defense for Acquisition, Technology, and Logistics to update the IUID task force report's estimates of costs and benefits by incorporating key elements of a sound investment analysis including a more complete estimate of all associated costs, an appropriate methodology for estimating benefits, and a sensitivity analysis of these estimates.

    Agency: Department of Defense
    Status: Open

    Comments: According to information provided by the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration in 2016: OSD, the military departments, and the Defense Logistics Agency are conducting activities (or planning to conduct activities) that will likely assist DOD in addressing several of the recommendations we made. We will continue to monitor DOD's activities and collect evidence as it becomes available.
    Recommendation: To enable DOD to successfully share UII data enterprisewide and integrate IUID functionality with its Enterprise Resource Planning systems, the Secretary of Defense should direct the Under Secretary of Defense for Acquisition, Technology, and Logistics to coordinate with the military services and the Defense Logistics Agency to define the requirements for using UII data across DOD and within the components' Enterprise Resource Planning systems.

    Agency: Department of Defense
    Status: Open

    Comments: According to information provided by the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration in 2016: OSD, the military departments, and the Defense Logistics Agency are conducting activities (or planning to conduct activities) that will likely assist DOD in addressing several of the recommendations we made. We will continue to monitor DOD's activities and collect evidence as it becomes available.
    Recommendation: To enable DOD to successfully share UII data enterprisewide and integrate IUID functionality with its Enterprise Resource Planning systems, the Secretary of Defense should direct the Under Secretary of Defense for Acquisition, Technology, and Logistics to coordinate with the military services and the Defense Logistics Agency to develop or revise integrated master schedules for the integration of IUID technology with the components' individual Enterprise Resource Planning systems-and between these systems-across DOD. These schedules should fully integrate distinct IUID activities.

    Agency: Department of Defense
    Status: Open

    Comments: According to information provided by the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration in 2016: OSD, the military departments, and the Defense Logistics Agency are conducting activities (or planning to conduct activities) that will likely assist DOD in addressing several of the recommendations we made. We will continue to monitor DOD's activities and collect evidence as it becomes available.
    Recommendation: The Secretary of Defense should direct the Secretary of the Navy to develop a plan to share UII data enterprisewide.

    Agency: Department of Defense
    Status: Open

    Comments: According to information provided by the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration in 2016: OSD, the military departments, and the Defense Logistics Agency are conducting activities (or planning to conduct activities) that will likely assist DOD in addressing several of the recommendations we made. We will continue to monitor DOD's activities and collect evidence as it becomes available.
    Director: Irving, Susan J
    Phone: (202) 512-6806

    1 open recommendations
    Recommendation: Treasury should build the capacity for a buyback program that could be used to respond to potential changes in market conditions during times of deficit. Such a program should allow for broader direct participation beyond the primary dealers. In conducting any buyback operations Treasury should (1) clearly articulate the purpose of the buyback program, (2) conduct the buyback reverse auctions on a regular and predictable schedule consistent with the purpose of the buyback program, and (3) target a few securities in narrow maturity bands at each reverse auction.

    Agency: Department of the Treasury
    Status: Open

    Comments: In October 2014, Treasury conducted a small-scale buyback operation to test the information technology infrastructure to ensure that its buyback functionality remains operational. In the reverse auction operation, Treasury bought back $22 million of a note maturing on 2/29/2016. In November 2014, Treasury announced that the operation was successful. Treasury conducted small-value buyback operations in April 2015, April 2016, November 2016, and April 2017 to ensure operational readiness of its buyback infrastructure. In announcing the buyback operations, Treasury noted that they should not be viewed by market participants as a precursor or signal of any pending policy changes regarding Treasury's use of buybacks. In June 2016, Treasury officials told us that eligibility to participate in buyback operations is limited to primary dealers because of constraints of the current trading systems. They also said that Treasury is continuing to examine the costs and benefits of buybacks as a debt management tool. As of August 2017 we asked Treasury officials for an update on the implementation status of this recommendation and are awaiting their response.
    Director: Farrell, Brenda S
    Phone: (202) 512-3604

    1 open recommendations
    Recommendation: To improve transparency of costs and the efficiency of suitability andpersonnel security clearance background investigation processes thatcould lead to cost savings, the Deputy Director for Management, Office of Management and Budget, in the capacity as Chair of the Performance Accountability Council, should expand and specify reform-related guidance to help ensure that reform stakeholders identify opportunities for cost savings, such as preventing duplication in the development of electronic case-management and adjudication technologies in the suitability determination and personnel security clearance processes.

    Agency: Executive Office of the President: Office of Management and Budget: Performance Accountability Council
    Status: Open

    Comments: In July 2013, OMB provided GAO with an update to this recommendation. Although OMB has not yet issued guidance to help ensure that reform stakeholders identify opportunities for cost savings, OMB noted that it continues to work with Executive Agents on activities that reduce duplication in electronic case management and adjudication technologies for the suitability determination and personnel security clearance processes and provided four examples of those activities. (1)In March 2012, OMB's Office of E-Government and Information Technology began meeting with OPM regarding opportunities to enhance the functionality of non-DoD adjudicative entities that are serviced by OPM's Central Verification System, a subsystem of OPM's Personnel Investigation Processing System. (2) In March 2012, OPM provided programming language to the National Security Agency for the Electronic Questionnaire for Investigations Processing (EQIP), which the PAC previously identified as the Executive Branch solution for all investigation requests/applications. Since, NSA has begun development of a single classified automated EQIP solution for the Intelligence Community (IC). (3) In May 2012, DoD directed the consolidation of the seven non-IC DOD Central Adjudication Facilities under a single centralized authority. This more efficiently allocates adjudicative resources in a single case management system. (4) In anticipation of the IC's move to a cloud computing environment, ODNI's Special Security Directorate has begun discussion with IC components on how best to support further standardization and prevent duplication as they develop and modify IT systems to implement investigative and adjudicative training standards, respond to reporting requirements, and implement revised adjudicative guidelines. (5) The PAC, the Security Executive Agent, and DOD continue to promote the adoption of the DOD eAdjudication system (CATS) solution within other agencies across Government. The CATS e-Processing Suite (e-Delivery, e-Screening, and e-Adjudication processes) eliminates manual processes and realizes adjudicative efficiencies through the use of technology. DoD recently reported that During FY2012, e-Delivery saved the DoD approximately 590,000 hours (over 280 man-years) in employee processing and handling time, equating to a one-year salary cost avoidance of nearly $33 million. In addition, during FY2012, e-Adjudication saved the DoD approximately 57,000 hours (over 28 man years) in employee adjudication time, equating to a one-year salary cost avoidance of nearly $3.2 million. Shortly after the report was issued, OPM provided GAO with a letter dated May 25, 2012, that included its plans to address the recommendations that GAO made in GAO-12-197, to improve the transparency of the costs and efficiency of the suitability and security clearance background investigation process. Although this recommendation was geared toward the Deputy Director for Management at OMB, OPM pledged to support OMB in the implementation of this recommendation by 1) providing cost analysis data to support cost efficient Executive Branch implementation of new Federal Investigative Standards, 2) supporting standardization and consolidation of investigative systems and processes to the extent it benefits the goals of cost efficiency and reciprocity, and 3) providing recommendations for the standardization of technology supporting suitability adjudicative processes to the extent this benefits the goals of cost efficiency and reciprocity. OPM noted that, in March 2012, it provided OMB reform leadership with both cost analysis data to support the implementation of the new Federal Investigative Standards and recommendations for the standardization of technology for the consideration of OMB's e-Government experts.
    Director: Khan, Asif A
    Phone: (202) 512-3000

    4 open recommendations
    Recommendation: To help provide for the successful implementation of Army and Air Force ERPs, and to help ensure that DFAS users have the training needed, the Secretary of Defense should direct the Secretary of the Army to ensure that time lines are established and monitored for those issues identified by DFAS that are impacting their efficient and effective use of GFEBS.

    Agency: Department of Defense
    Status: Open

    Comments: In commenting on the draft report, DOD concurred with the recommendation and cited action(s) being taken by the Army to ensure that time lines are established and monitored for those issues identified by DFAS that are impacting their efficient and effective use of GFEBS. We have made attempts to follow up with Office of the Undersecretary of Defense (Comptroller) Acquisition Technology and Logistics officials to obtain documentation of actions taken and to determine whether the Army has taken sufficient action to address this recommendation. However, as of July 2017, we have not been able to obtain documentation that supports that this recommendation was addressed.
    Recommendation: To help provide for the successful implementation of Army and Air Force ERPs, and to help ensure that DFAS users have the training needed, the Secretary of Defense should direct the Secretary of the Air Force to ensure that time lines are established and monitored for those issues identified by DFAS that are impacting their efficient and effective use of DEAMS.

    Agency: Department of Defense
    Status: Open

    Comments: In commenting on the draft report, DOD concurred with the recommendation and cited action(s) being taken by the Air Force to ensure that time lines are established and monitored for those issues identified by DFAS that are impacting their efficient and effective use of DEAMS. We have made attempts to follow up with Office of the Undersecretary of Defense (Comptroller) Acquisition Technology and Logistics officials to obtain documentation of actions taken to determine whether the Army has taken sufficient action to address this recommendation. However, as of July 2017, we have not been able to obtain documentation that supports that this recommendation was addressed.
    Recommendation: To help provide for the successful implementation of Army and Air Force ERPs, and to help ensure that DFAS users have the training needed, the Secretary of Defense should direct the Secretary of the Army to improve training for GFEBS users by providing training on actual job processes in a manner that allows users to understand how the new processes support their job responsibilities and the work they are expected to perform.

    Agency: Department of Defense
    Status: Open

    Comments: In commenting on the draft report, DOD concurred with the recommendation and cited action(s) being taken by the Army to improve training for GFEBS users on actual job processes. We have made attempts to follow up with Office of the Undersecretary of Defense (Comptroller) Acquisition Technology and Logistics officials to obtain documentation of actions taken to determine whether the Army has taken sufficient action to address this recommendation. However, as of July 2017, we have not been able to obtain documentation that supports that this recommendation was addressed.
    Recommendation: To help provide for the successful implementation of Army and Air Force ERPs, and to help ensure that DFAS users have the training needed, the Secretary of Defense should direct the Secretary of the Air Force to improve training for DEAMS users by providing training on actual job processes in a manner that allows users to understand how the new processes support their job responsibilities and the work they are expected to perform.

    Agency: Department of Defense
    Status: Open

    Comments: In commenting on the draft report, DOD concurred with the recommendation and cited action(s) being taken by the Air Force to improve training for DEAMS users on actual job processes. We have made attempts to follow up with Office of the Undersecretary of Defense (Comptroller) Acquisition Technology and Logistics officials to obtain documentation of actions taken to determine whether the Army has taken sufficient action to address this recommendation. However, as of July 2017, we have not been able to obtain documentation that supports that this recommendation was addressed.
    Director: Goldenkoff, Robert N
    Phone: (202)512-2757

    3 open recommendations
    Recommendation: In order to maintain progress in maximizing the efficiency of existing data sources, and to improve the broader efficiency of the federal statistical system and improve communication among agencies and others, the Director of OMB, in consultation with the Chief Statistician, should work with the ICSP, when OMB next updates guidance on agency survey and statistical information collection and dissemination methods, to include additional details on actions agencies can take to meet requirements to identify duplication, to consult with persons outside of the agency, and address other requirements as appropriate.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: OMB concurred with our recommendation. As of August 2017, the team is awaiting an update from the agency on the status of OMB's actions to implement this recommendation.
    Recommendation: In order to maintain progress in maximizing the efficiency of existing data sources, and to improve the broader efficiency of the federal statistical system and improve communication among agencies and others, the Director of OMB, in consultation with the Chief Statistician, should work with the ICSP to create new methods or enhance existing methods to improve the dissemination of information and resources produced by interagency statistical committees. For example, such enhancements could include increasing the timeliness and availability of information on websites to better capture the full range of products and identify committee priorities.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: OMB concurred with our recommendation and in July 2014 reported that it plans to implement it by launching a new website for the Federal Committee on Statistical Methodology. The new website will be hosted by the General Services Administration and will give interagency statistical committees the ability to manage their own webpages and disseminate products. As of August 2017, the team is awaiting an update from the agency on the status of OMB's actions to implement this recommendation.
    Recommendation: In order to maintain progress in maximizing the efficiency of existing data sources, and to increase the reliability of the information presented on the Reginfo.gov website and in OMB's internal system, the Director of OMB, in consultation with the Chief Statistician, should work with the ICSP to implement quality-control procedures designed to identify and remedy any differences between cost and burden information provided on the website and in the related supporting statement documentation that underlies this information.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: OMB concurred with our recommendation. As of August 2017, the team is awaiting an update from OMB on the status of actions taken to implement this recommendation.
    Director: Courts, Michael J
    Phone: (202)512-3000

    1 open recommendations
    Recommendation: In order to contain costs and reduce duplication of administrative support services overseas, Congress may wish to consider requiring agencies to participate in ICASS services unless they provide a business case to show that they can obtain these services outside of ICASS without increasing overall costs to the U.S. government or that their mission cannot be achieved within ICASS.

    Agency: Congress
    Status: Open

    Comments: As of March 2017, no legislative action has yet been taken. Congress has not required agencies to participate in ICASS absent a business case that shows that they can obtain services outside ICASS without additional cost to the U.S. government, as GAO suggested in January 2012. In July 2013, legislation was introduced in the Senate directing the Secretary of State to develop a process that any agency participating in the ICASS program shall use to provide a cost analysis and justification for the agency's decision to opt out, in whole or in part, of ICASS services. Congress did not pass this legislation, passing in its stead the Consolidated Appropriations Act, 2014, which contained no language related to ICASS. In January 2014, the joint explanatory statement regarding the Consolidated Appropriations Act, 2014, included a direction that the Secretary of State develop, in coordination with the ICASS Service Center and participating agencies, an efficient process by which an agency participating in the ICASS program provides a cost analysis and justification for the agency's decision to opt out of any ICASS services. However, this direction does not speak to a requirement that agencies participate in ICASS absent such a justification. Action on this matter is important because continued duplication of administrative services limits ICASS's ability to achieve economies of scale and deliver services more efficiently.
    Director: Goldenkoff, Robert N
    Phone: (202)512-3000

    2 open recommendations
    including 1 priority recommendation
    Recommendation: To improve the Bureau's ability to control costs for the 2020 decennial and balance cost and quality, the Secretary of Commerce should direct the Under Secretary of the Economics and Statistics Administration, as well as the Director of the U.S. Census Bureau, to finalize how the Bureau will apply cost as an evaluation criterion for choosing among design alternatives for 2020 and ensure that all criteria are transparent, well documented, and consistently applied before alternatives are eliminated.

    Agency: Department of Commerce
    Status: Open

    Comments: Commerce neither agreed nor disagreed with this recommendation. According to the Census Bureau, each research and testing (R&T) project team was to develop a study plan outlining the goal of the project, the expected outcome, and the methodology to be used to arrive at data to inform trade off analysis and decision-making. To help ensure efficient use of resources for 2020 R&T projects, and that the conclusions reached by the projects were sound and provide decision makers with reliable findings, the Bureau planned to establish internal Scientific and Methodological Review Panels. These panels were to evaluate research designs, provide critical feedback and guidance to the research teams and assess the validity of any findings, conclusions and recommendations. In October 2015 the Bureau released an operational plan that described at a high level how cost was a consideration, but it did not lay out the criteria to be used. As of July 2017, we are following up with Census officials to obtain evidence that cost is being used as an evaluation criterion when choosing among design alternatives.
    Recommendation: GAO previously recommended that the Secretary of Commerce direct the Bureau to establish guidance, policies, and procedures for cost estimation that would meet best practice criteria. To help ensure that the Bureau produces a reliable and high-quality cost estimate for the 2020 Census, the Bureau should finalize guidance, policies, and procedures for cost estimation in accordance with best practices prior to developing the Bureau's initial 2020 life cycle cost estimate.

    Agency: Department of Commerce: Bureau of the Census
    Status: Open
    Priority recommendation

    Comments: Commerce neither agreed nor disagreed with this recommendation. In October 2015, the Bureau announced an estimate of its 2020 Census life-cycle cost. In our June 30, 2016 report (GAO-16-628), we assessed the Bureau's guidance, policies, and procedures underlying that estimate. We found that the Bureau's cost estimate partially met the characteristics of two best practices (comprehensive and accurate) described in the GAO Cost Guide and minimally met the other two (well-documented and credible). In addition, best practices state that a risk and uncertainty analysis should be performed to determine the level of risk associated with the cost estimate. The Bureau carried out such an analysis only for a portion of estimated costs for fiscal years 2018 to 2020, covering $4.6 billion. This amounts to about 37 percent of the $12.5 billion total estimated life-cycle cost, and less than one-half of the total estimated cost of the Bureau to comply with best practices for cost estimation. To fully implement this recommendation, the Bureau needs to implement specific controls over its cost estimation process for the 2020 Census, such as guidance that documents who is responsible for what and when, and what information flows where and when. As of July 2017, Bureau officials are currently gathering artifacts to support implementation of this recommendation.
    Director: Brown, Orice Williams
    Phone: (202)512-5837

    4 open recommendations
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to strengthen procedures in place to guide Reserve Banks' efforts to manage emergency program access for higher-risk borrowers by providing more specific guidance on how Reserve Bank staff should exercise discretion and document decisions to restrict or deny program access for depository institutions and primary dealers that would otherwise be eligible for emergency assistance.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to document a plan for estimating and tracking losses that could occur under more adverse economic conditions within and across all emergency lending activities and for using this information to inform policy decisions, such as decisions to limit risk exposures through program design or restrictions applied to eligible borrowing institutions.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff, in drafting regulations to establish the policies and procedures governing emergency lending under section 13(3) of the Federal Reserve Act, to set forth the Federal Reserve Board's process for documenting, to the extent not otherwise required by law, its justification for each use of this authority.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Recommendation: While creating control systems at the same time that the emergency programs were being designed and implemented posed unique challenges, the recent crisis provided invaluable experience that the Federal Reserve System can apply in the future should the use of these authorities again become warranted. Going forward, to further strengthen policies for selecting vendors, ensuring the transparency and consistency of decision making involving the implementation of any future emergency programs, and managing risks related to these programs, the Chairman of the Federal Reserve Board should direct Federal Reserve Board and Reserve Bank staff to document the Federal Reserve Board's guidance to Reserve Banks on types of emergency program decisions and risk events that require approval by or consultation with the Board of Governors, the Federal Open Market Committee, or other designated groups or officials at the Federal Reserve Board.

    Agency: Federal Reserve System: Board of Governors
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Brown, Orice Williams
    Phone: (202)512-5837

    3 open recommendations
    Recommendation: To improve strategic planning, performance management, and program oversight within and related to NFIP, the Secretary of DHS should direct the FEMA Administrator to develop a comprehensive workforce plan according to PKEMRA that identifies agency staffing and skills requirements, addresses turnover and staff vacancies, and analyzes FEMA's use of contractors.

    Agency: Department of Homeland Security
    Status: Open

    Comments: According to FEMA officials, as of July 2016, FEMA is in the process of developing a Workforce Strategic Plan they say will contribute to organizational performance and mission by enabling FEMA to align the overall workforce with strategic priorities. FEMA expected to complete the plan by the first quarter of FY2017. As of December 2016, FEMA officials said they were still working to implement this recommendation and agreed to provide us with an update of their progress.
    Recommendation: To improve FEMA's policies, procedures, and systems for achieving NFIP's program goals, the Secretary of DHS should direct the FEMA Administrator to consider the costs and benefits of implementing an interim system for FEMA and updating its document management policies and procedures while waiting for DHS to implement an agencywide electronic document management system.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA officials stated that, as of July 2016, FEMA is working to pilot an Electronic Records Management System (ERMS). They said that they expected to have all email records in an electronic state by December 31, 2016, and all records in an electronic state by December 31, 2019. They said that they expect the end state in 2019 to meet the Presidential Directive and NARA guidelines. As of December 2016, FEMA officials said they were still working to implement this recommendation and agreed to provide us with an update of their progress.
    Recommendation: To improve FEMA's policies, procedures, and systems for achieving NFIP's program goals, the Secretary of DHS should direct the FEMA Administrator to establish timelines for and complete the development and implementation of FEMA's revised acquisition process, in line with the DHS Acquisition Directive 102-01, including a rollout process with staff training and a mechanism to better ensure that all acquisitions undergo the necessary reviews.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA officials stated that, as of July 2016, a Disaster Acquisitions Response Team (DART) was in place along with metrics in place to monitor the team's success. They said they had also awarded a contract to serve as a contract file repository and that previously scanned contract files would be uploaded by December 31, 2016. As of December 2016, FEMA officials said they were still working to implement this recommendation and agreed to provide us with an update of their progress.
    Director: Clowers, Angela N
    Phone: (202)512-4010

    3 open recommendations
    Recommendation: To help resolve identified borrower noncompliance in a timely manner, the Secretary of Agriculture should direct the Administrator of RHS to implement enforcement mechanisms that can be tailored to the severity of the borrower noncompliance, such as the civil money penalty enforcement provision in its program regulations.

    Agency: Department of Agriculture
    Status: Open

    Comments: The agency continues to take actions to address this recommendation, but has not yet fully implemented it.
    Recommendation: To better ensure that requirements for tenant eligibility are met across the FLH portfolio, the Secretary of Agriculture should direct the Administrator of RHS to require its loan servicers to use the Systematic Alien Verification and Entitlements (SAVE) program administered by the Department of Homeland Security to verify tenant's residency status during supervisory reviews.

    Agency: Department of Agriculture
    Status: Open

    Comments: The agency has not implemented this recommendation.
    Recommendation: The Secretary of Agriculture should direct the Administrator of RHS to better utilize available data on demand for the FLH program--such as systematically reviewing local market analyses, further analyzing occupancy data on a statewide, regional, or national level, and retaining and analyzing application information--to help target available funding to areas of greatest need.

    Agency: Department of Agriculture
    Status: Open

    Comments: The agency continues to take actions to address this recommendation, but has not yet fully implemented it.
    Director: White, James R
    Phone: (202)512-5594

    1 open recommendations
    Recommendation: To ensure that IRS can adequately enforce certain tax provisions, Congress may wish to consider providing IRS with MEA to use tax return information from previous years to ensure that taxpayers do not improperly claim credits or deductions in excess of lifetime limits where applicable.

    Agency: Congress
    Status: Open

    Comments: As of April 2017, Congress had not yet provided IRS with math error authority (MEA) to use tax return information from previous years to ensure that taxpayers do not improperly claim credits or deductions in excess of lifetime limits.
    Director: Williamson, Randall B
    Phone: (206)287-4860

    5 open recommendations
    Recommendation: To address weaknesses in DCOE's strategic plan, the Secretary of Defense, through the Director of TMA, should direct the DCOE director to revisit and revise as necessary the organization's goals for completing statutorily required responsibilities.

    Agency: Department of Defense
    Status: Open

    Comments: As of July 2017, DOD officials have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Recommendation: To address weaknesses in DCOE's strategic plan, the Secretary of Defense, through the Director of TMA, should direct the DCOE director to require the directorates to align their day-to-day activities to support DCOE's mission and goals.

    Agency: Department of Defense
    Status: Open

    Comments: As of July 2017, DOD officials have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Recommendation: To address weaknesses in DCOE's strategic plan, the Secretary of Defense, through the Director of TMA, should direct the DCOE director to improve the performance measures in the plan to enable DCOE to determine if achievement of each measure fully supports attainment of its associated goal.

    Agency: Department of Defense
    Status: Open

    Comments: As of July 2017, DOD officials have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Recommendation: To ensure that DCOE obligations are properly classified and recorded in accordance with OMB guidance, the Secretary of Defense, through the Office of the Assistant Secretary of Defense (Health Affairs) (ASD(HA)), should direct TMA to develop written procedures with detailed steps to be performed for ensuring proper classification and recording of obligations in TMA's financial management systems.

    Agency: Department of Defense
    Status: Open

    Comments: As of July 2017, DOD officials have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Recommendation: To ensure that DCOE obligations are properly classified and recorded in accordance with OMB guidance, the Secretary of Defense, through the ASD(HA), should direct TMA to assign responsibility for updating and maintaining procedural guidance and systems codes to assure consistency with annual OMB guidance.

    Agency: Department of Defense
    Status: Open

    Comments: As of July 2017, DOD officials have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Director: White, James R
    Phone: (202)512-5594

    1 open recommendations
    Recommendation: To gain efficiencies and improve taxpayer service, the Commissioner of Internal Revenue should direct the appropriate officials, based on the quality of service provided by comparable organizations and on what matters most to the customer, to determine a customer service telephone standard, and the resources required to achieve this standard based on input from Congress and other stakeholders.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: In January 2017, IRS officials provided results of a benchmarking study that it completed in response to our recommendation. In that study, an IRS team compared IRS's service, measures and goals to comparable agencies and companies. For example, IRS compared the types of measures the companies used, including those that were primarily service-driven and resource-driven. As a result, the team recommended options for additional measures to indicate the level of access taxpayers have to service, including across channels. In addition, IRS concluded that the ideal level of service is 83 percent, which optimizes a balance between wait time, disconnects, and assistor availability. It also recommended exploring using new technology including email, online chat, and telephone call back features as well as to establish regularly scheduled follow-up benchmarking. However, IRS did not adopt the standard level of service goal of 83 percent. Furthermore, in its fiscal year 2018 performance measures and goals, IRS planned a 39 percent level of service, which is substantially lower than the prior 2 year targets, both of which IRS exceeded. In addition, IRS did not estimate the resources required to achieve the level of service standard that it identified in its 2016 benchmarking study. While these benchmarking results represent an important step toward delivering a certain standard of telephone service, without actually setting goals that are consistent with those results and determining and communicating the resources required to achieve them, IRS is unable to work effectively with Congress and other stakeholders to deliver desired levels of service.
    Director: St James, Lorelei
    Phone: (214)777-5719

    1 open recommendations
    Recommendation: To improve the management and oversight of the Low-Income Program, the Chairman of the FCC should conduct a robust risk assessment of the Low-Income Program.

    Agency: Federal Communications Commission
    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
    Director: Scire, Mathew J
    Phone: (202)512-6794

    1 open recommendations
    Recommendation: To strengthen accountability and transparency in FHA's management of the Fund, Congress may wish to consider clarifying (1) the definition of the Fund's capital ratio--specifically, whether the denominator of the ratio was intended to be the amortized insurance-in-force; (2) the definition of the phrase "established target subsidy rate" used in HERA; and (3) the nature and extent of information that FHA should be reporting on subsidy rates pursuant to HERA, recognizing that subsidy rates are generally only reestimated once a year under current budget processes.

    Agency: Congress
    Status: Open

    Comments: As of July 2017, Congress has not acted on this matter for consideration.
    Director: White, James R
    Phone: (202)512-5594

    2 open recommendations
    Recommendation: To understand the scope of the business nonfiler population, the Commissioner of Internal Revenue should estimate the magnitude of business nonfiling among businesses registered with IRS, using data from its operational files to select cases for further investigation. Based on the results of this work IRS should develop a tax gap estimate for the impact of business nonfiling insofar as doing so is cost-effective.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: As of March 2017, IRS said it did not plan to develop a partial estimate of the business nonfiler rate, as we recommended in August 2010. IRS reported that funding would likely be unavailable for it to do so using operational data. According to IRS, its existing operational data on business nonfilers are sufficient. However, even a partial estimate could give IRS additional information that would be useful in its strategic planning and help it determine what priority it should place on this type of noncompliance.
    Recommendation: To monitor the performance of business nonfiler activities, the Commissioner of Internal Revenue should set a deadline for developing data that can be used to measure the performance of the BMF CCNIP and its business nonfiler compliance activities overall.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS has determined that it does not have the necessary data that could be used to measure its business nonfiler efforts across the agency and that it therefore cannot set a deadline for developing such data, as GAO recommended in August 2010. According to IRS, developing such data would be prohibitively costly. Rather, as of March 2017, IRS plans to continue to use the data at the operating division level. Without going through the process of developing performance data, IRS is unable to know what data would aid in monitoring and evaluating its business nonfiler efforts. Absent cross-agency performance data, IRS is unable to fully understand the outcomes of its business nonfiler efforts.
    Director: Clark, Cheryl E
    Phone: (202)512-9377

    2 open recommendations
    Recommendation: The Director of Personnel and Administration at Commission headquarters should follow established policies and procedures in taking action to conduct a review of contracts and purchase orders outstanding for completeness, accuracy, and proper dates.

    Agency: American Battle Monuments Commission: Human Resources and Administration Director
    Status: Open

    Comments: In response to this recommendation, the Commission stated that it completed such a review in fiscal year 2009 and made corrections as to how the Commission issues contracts and purchase orders. In addition, the Commission hired a consultant, a retired Federal Government Contracting Officer, to assist with contracting activities and to help draft and implement the Commission's policies and procedures. During our fiscal year 2010 audit, we found errors in relation to the Commission's contracts and found that Headquarter's Active Contracts List for contracts over $100,000 was not up to date. We found 3 out of 20 expenditures we tested that were obligated before there was a signed contract. During our fiscal year 2011 audit, we found that the Headquarter's Active Contracts List for contracts over $100,000 was not being kept up to date and reconciled to the undelivered orders account. During our fiscal year 2012 audit, we found there were no policies and procedures for processing engineering contracts. We were informed by the Commission that they were in the process of documenting policies and procedures for the entire contracting process. We also found there were no documented policies and procedures for reviewing year end open obligations and accounts payable to verify the accuracy and validity of year end balances. Additionally, there was no documented review of accounts payable or open obligations performed at year-end for all the open contracts. As a result, we found errors in year-end aged vendor liability reports and open purchase orders that no longer represented valid obligations and should have been deobligated. During our fiscal year 2017 follow-up, the Commission informed us that they plan to establish procurement-related policies and procedures to address our recommendation. We will follow up on this open recommendation at a later date.
    Recommendation: The Director of Personnel and Administration at Commission headquarters should follow established policies and procedures in taking action to coordinate procurement activity with finance personnel to ensure accurate and compliant obligation of funding of procurements, including proper application of multiyear contract terms.

    Agency: American Battle Monuments Commission: Human Resources and Administration Director
    Status: Open

    Comments: In response to this recommendation, the Commission stated that acquisition personnel would ensure coordination with finance personnel to be certain that accurate and compliant obligation of funding of procurements, including proper application of multi-year contract terms. During our fiscal year 2010 and 2011 audits, we found errors in relation to the Commission's contracts and determined improvements were still needed in the oversight of contracts. During our fiscal year 2012 audit, we found there were no policies and procedures for processing engineering contracts. We were informed by the Commission that they were in the process of documenting policies and procedures for the entire contracting process. We also found there were no documented policies and procedures for reviewing year end open obligations and accounts payable to verify the accuracy and validity of year end balances. Additionally, there was no documented review of accounts payable or open obligations performed at year-end for all the open contracts. As a result, we found errors in year-end aged vendor liability reports and open purchase orders that no longer represented valid obligations and should have been deobligated. During our fiscal year 2017 follow-up, the Commission informed us that they plan to establish procurement-related policies and procedures to address our recommendation. We will follow up on this open recommendation at a later date.
    Director: Clark, Cheryl E
    Phone: (202)512-9521

    1 open recommendations
    Recommendation: The Commissioner of IRS should direct the appropriate IRS officials to, once IRS identifies the control weaknesses that result in inaccuracies or errors that affect the financial reporting of unpaid tax assessments, implement control procedures to routinely prevent, or to detect and correct, such errors.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: IRS created a long-term corrective action plan that contains specific actions to improve control procedures to prevent or detect errors. While IRS completed some actions during fiscal year 2016, it has not completed most of the actions in the plan or documented milestones or target completion dates for these remaining actions. In addition, during fiscal year 2016, GAO and IRS continued to identify misclassified unpaid assessments that resulted from inaccuracies or errors in taxpayer accounts. Thus, IRS's actions to date have not been effective at fully addressing the issues that continue to cause a lack of transaction traceability and material inaccuracies produced by the subsidiary ledger. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 audit.
    Director: Brostek, Michael
    Phone: (202)512-9039

    1 open recommendations
    Recommendation: To improve compliance with shareholder basis rules, Congress may wish to require S corporations to calculate and report shareholder's stock and debt basis as completely as possible. S corporations would report the calculation on the Schedule K-1 and send it to shareholders as well as IRS. If Congress judges that stock purchase price information that is currently only available to shareholders should not be transmitted to the S corporation due to privacy concerns, an alternative is to require that S corporations report less complete basis calculations using information already available to the S corporation.

    Agency: Congress
    Status: Open

    Comments: As of March 2017, Congress had not enacted legislation to require S corporations--a federal business type that provides certain tax benefits like passing income and losses to shareholders' individual returns-- to calculate and report shareholder's stock and debt basis as completely as possible and report the calculation to shareholders and IRS, as GAO suggested in December 2009.
    Director: White, James R
    Phone: (202)512-5594

    1 open recommendations
    Recommendation: Congress may wish to consider providing IRS with math error authority (MEA) to use prior years' tax return information to automatically verify taxpayers' compliance with the limit on the number of years the Hope credit can be claimed.

    Agency: Congress
    Status: Open

    Comments: As of August 3, 2017, Congress has not provided IRS with math error authority (MEA) to use prior years' tax return information to automatically verify taxpayers' compliance with the limit on the number of years the Hope Scholarship Credit, now known as the American Opportunity Tax Credit (AOTC) can be claimed. The AOTC can be claimed by taxpayers for qualified tuition and related expenses for 4 years of postsecondary education. Under the Protecting Americans From Tax Hikes Act of 2015, IRS was granted MEA to disallow a claim for the AOTC if the taxpayer is not permitted to claim the credit due to prior fraudulent or reckless claims, or if the taxpayer omitted information relating to prior improper claims of the credit. IRS does not have authority to automatically deny an AOTC even if the taxpayer claims the credit for more than the 4 allowable years. GAO has in the past provided technical assistance to the House Solutions Caucus in drafting legislative language for a bill on extending MEA to use prior years' returns for verifying compliance with limits on the credit. In addition, the Administration has for many years included a revenue proposal in Treasury's Green Book to provide IRS with "correctable error authority" where the (1) information provided by the taxpayer does not match the information contained in government databases, (2) taxpayer has exceeded the lifetime limit for claiming the credit or deduction, or (3) taxpayer failed to include proper documentation with his or her return. If this revenue proposal was enacted, IRS would have the authority to deny claims for the AOTC if the taxpayer has already received the credit for 4 years.
    Director: Brown, Orice Williams
    Phone: (202) 512-3000

    5 open recommendations
    Recommendation: To provide transparency and accountability over the payments FEMA makes to WYOs for expenses and profits, the Secretary of Homeland Security should direct the Under Secretary of Homeland Security, FEMA, to determine in advance the amounts built into the payment rates for estimated expenses and profit.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA is continuing (as of 08/29/2014) to analyze Write-Your-Own (WYO) payments and related flood expenses for selected companies and is evaluating the reliability (accuracy, consistency, etc.) of the National Association of Insurance Commissioners (NAIC) data for purposes of performing the analysis we had recommended.
    Recommendation: To provide transparency and accountability over the payments FEMA makes to WYOs for expenses and profits, the Secretary of Homeland Security should direct the Under Secretary of Homeland Security, FEMA, to annually analyze the amounts of actual expenses and profit in relation to the estimated amounts used in setting payment rates.

    Agency: Department of Homeland Security
    Status: Open

    Comments: In its initial response to this report, FEMA did not concur with this recommendation. In November 2016, FEMA restated its position and concurs with this recommendation, and is in the process of implementing it.
    Recommendation: To provide transparency and accountability over the payments FEMA makes to WYOs for expenses and profits, the Secretary of Homeland Security should direct the Under Secretary of Homeland Security, FEMA, to consider the results of the analysis of payments, actual expenses, and profit in evaluating the methods for paying WYOs.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA is continuing (as of 08/29/2014) to analyze WYO payments and related flood expenses for selected companies and is evaluating the reliability (accuracy, consistency, etc.) of the National Association of Insurance Commissioners (NAIC) data for purposes of performing the analysis we had recommended.
    Recommendation: To increase the usefulness of the data reported by WYOs to the National Association of Insurance Commissioners (NAIC) and to institutionalize FEMA's use of such data, the Secretary of Homeland Security should direct the Under Secretary of Homeland Security, FEMA, to take actions to obtain reasonable assurance that NAIC flood insurance expense data can be considered in setting payment rates that are appropriate, including identifying affiliated company profits in reported flood insurance expenses.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA continues (as of 08/29/2014) to work with the National Association of Insurance Commissioners (NAIC) to improve the consistency with which commission, operating, and loss adjustment expenses are reported by insurance companies that participate in the National Flood Insurance Program.
    Recommendation: To increase the usefulness of the data reported by WYOs to the National Association NAIC and to institutionalize FEMA's use of such data, the Secretary of Homeland Security should direct the Under Secretary of Homeland Security, FEMA, to develop comprehensive data analysis strategies to annually test the quality of flood insurance data that WYOs report to NAIC.

    Agency: Department of Homeland Security
    Status: Open

    Comments: FEMA continues (as of 08/29/2014) to work with the National Association of Insurance Commissioners (NAIC) to improve the consistency with which commission, operating, and loss adjustment expenses are reported by insurance companies that participate in the National Flood Insurance Program.
    Director: Clark, Cheryl E
    Phone: (202)512-9377

    1 open recommendations
    Recommendation: The Finance Officer at the Commission's European Regional (ER) office should instruct and monitor approving officials to ensure that expenditure transactions are dated when goods and services are received and approved before payments are processed.

    Agency: American Battle Monuments Commission: European Regional Office
    Status: Open

    Comments: During our fiscal years 2009, 2010, and 2011 financial statement audits, we continued to find expenditure transactions being processed prior to the goods or services being received and approved for payment. During our fiscal year 2012 audit, the Commission informed us that since the transition to a new financial management system in August 2011, all receiving is conducted in the iProcurement system (part of the Oracle accounting system) and must be complete before an invoice is processed for payment in Oracle. Although we found that invoices were approved before payment, we continued to find instances where the invoices were not dated and/or signed when goods or invoices were received. During fiscal year 2017, the Commission informed us that they developed a related policy to address our recommendation. However, the Commission has not provided documentation or an explanation of the controls used by management for monitoring (i.e. evaluating or reviewing) the effective implementation of the procedures established related to this recommendation. Therefore, we will continue to follow up on this open recommendation with the Commission at a later date.
    Director: Williams, Orice M
    Phone: (202)512-5837

    2 open recommendations
    Recommendation: The Secretary of the Department of Homeland Security should direct FEMA to take steps to ensure that its rate-setting methods and the data it uses to set rates result in full-risk premiums rates that accurately reflect the risk of losses from flooding. These steps should include, for example, verifying the accuracy of flood probabilities, damage estimates, and flood maps; ensuring that the effects of long-term planned and ongoing development, as well as climate change, are reflected in the flood probabilities used; and reevaluating the practice of aggregating risks across zones.

    Agency: Department of Homeland Security
    Status: Open

    Comments: As of January 2017, FEMA is taking steps to verify the accuracy of flood probabilities by collecting and analyzing data from flood insurance studies. FEMA is also continuing to monitor the completion of these studies to determine when a statistically valid amount of data is available so that it can better assess flood risk. To verify the accuracy of damage estimates, FEMA is collecting data required to revise its estimates of flood damage and is undertaking studies to determine factors beyond flood water depth that contribute to flood damage. FEMA will incorporate that information into its rate-setting methodology as the necessary data becomes available. To verify the accuracy of flood maps, FEMA continues to reassess flood risk, evaluate coastal flood maps, and update its overall map inventory. To ensure that flood probabilities reflect long-term and ongoing planned development and climate change, FEMA is working with the Technical Mapping Advisory Committee to ensure the best available information on flood probabilities is used for rate-setting. In addition, as FEMA collects information on flood probabilities, it will conduct analyses to evaluate the practice of classifying risk across zones.
    Recommendation: The Secretary of the Department of Homeland Security should direct FEMA to ensure that information is collected on the location, number, and losses associated with existing and newly created grandfathered properties in NFIP and to analyze the financial impact of these properties on the flood insurance program.

    Agency: Department of Homeland Security
    Status: Open

    Comments: To assess the impact of grandfathered properties on the NFIP, as of January 2017, FEMA has begun to develop a process to obtain current zone designations for all existing policyholders. In addition, FEMA is requiring zone determination data to be updated as flood maps change. According to FEMA, this will allow officials to determine which policyholders are grandfathered but will not allow the determination of a property-specific rate in all circumstances.
    Director: Engel, Gary T
    Phone: (202)512-8815

    1 open recommendations
    including 1 priority recommendation
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary, in coordination with the Controller of OMB's Office of Federal Financial Management, to develop and implement effective processes for monitoring and assessing the effectiveness of internal control over the processes used to prepare the CFS.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury designed and implemented an OMB Circular No. A-123 internal control review for the CFS compilation processes. In fiscal year 2017, Treasury plans to use the internal control review to support its assessment on the effectiveness of internal controls over the processes used to prepare the CFS. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Director: Clark, Cheryl E
    Phone: (202) 512-3000

    1 open recommendations
    Recommendation: To address other issues that may exist in IRS's master files that affect penalty calculations, the Commissioner of Internal Revenue should direct appropriate IRS officials to, in instances where programs are not functioning in accordance with the intent of the IRM, take appropriate action to correct the programs so that they function in accordance with the IRM.

    Agency: Department of the Treasury: Internal Revenue Service
    Status: Open

    Comments: According to IRS, it had substantially completed its corrective actions to address 19 penalty programming issues it had identified from its internal assessment of penalty computation programs. However, as of September 30, 2016, IRS had not provided us with supporting documentation to validate that it completed the corrective actions. We will continue to evaluate IRS's actions to address this recommendation during our fiscal year 2017 financial statement audit.
    Director: Iritani, Katherine M
    Phone: (202)512-3000

    1 open recommendations
    Recommendation: To enhance the transparency of CMS oversight and clarify and communicate the types of allowable state financing arrangements, the Administrator of CMS should provide each state CMS reviews under its initiative with specific and written explanations regarding agency determinations on the allowability of various arrangements for financing the nonfederal share of Medicaid payments and make these determinations available to all states and interested parties.

    Agency: Department of Health and Human Services: Centers for Medicare and Medicaid Services
    Status: Open

    Comments: As of July 2016, HHS officials reported that they have not implemented this recommendation. GAO considers it to be open. We will update the status of this recommendation when we receive additional information.
    Director: Aloise, Eugene E
    Phone: (202)512-6870

    2 open recommendations
    Recommendation: To ensure that NNSA functions as a separately organized agency, the Secretary of Energy and the Administrator, NNSA, should clearly define NNSA's status as a separately organized agency within the department.

    Agency: Department of Energy
    Status: Open

    Comments: In his 31 USC Section 720 response to our report, the Deputy Secretary of Energy stated that he did not concur with this recommendation. He stated that elements of the Department and the NNSA had executed memoranda of understanding specifying how certain Department-wide functions would be performed while respecting the statutory insulation of NNSA personnel. He also stated that the Department will consider issuing circumstance-specific guidance where required to correct misperceptions about the effect of the NNSA's act limitations. NNSA's relationship with DOE continues to evolve. NNSA asserted its independence aggressively through July 2012 when an important security incident took place at the Y-12 plant. Since that time, NNSA has been less independent.
    Recommendation: To ensure that NNSA functions as a separately organized agency, the Secretary of Energy and the Administrator, NNSA, should clearly define NNSA's status as a separately organized agency within the department.

    Agency: Department of Energy: National Nuclear Security Administration
    Status: Open

    Comments: In his 31 USC Section 720 response to our report, the Deputy Secretary of Energy stated that he did not concur with this recommendation. He stated that elements of the Department and the NNSA had executed memoranda of understanding specifying how certain Department-wide functions would be performed while respecting the statutory insulation of NNSA personnel. He also stated that the Department will consider issuing circumstance-specific guidance where required to correct misperceptions about the effect of the NNSA's act limitations. Since we received the letter, there have been instances where the DOE/NNSA relationship has become less clear.
    Director: Daly, Kay L
    Phone: 2025124063

    1 open recommendations
    Recommendation: To better understand the relationship of costs and revenues related to fees SSA collects for administering state SSI supplementation programs, the Commissioner of SSA should direct appropriate officials to study those costs to determine the full cost, including the cost of services provided by other entities for the benefit of SSA.

    Agency: Social Security Administration
    Status: Open

    Comments: SSA is continuing with the roll out of the Employee Office Sampler to all field offices across the nation. According to SSA, this tool removes the manual aspect of the District Office Work Sampling process. A decision was made by SSA to update the Standard Time Values (STVs) used for costing out the full cost SSA incurs for processing state Social Security Insurance claims. SSA stated that it completed these studies in fiscal year 2012 and placed the new STVs into its Cost Analysis System for use in fiscal year 2013. According to SSA, this update allows SSA to more accurately capture the full cost of this work for the agency. In December 2016, SSA stated that it has completed the roll out of the Employee Office Sampler (EOS) to the field offices in the fourth quarter of fiscal year 2016. The Office of Financial Policy and Operations is currently working on a proposal for the IT Investment Process (ITIP) to roll out the EOS to the remaining operational components, targeted for early 2017.
    Director: Daly, Kay L
    Phone: 2025166906

    1 open recommendations
    Recommendation: To help further the progress toward meeting the goals of IPIA and determining states' role in assisting federal agencies to report a national improper payment estimate on federal programs, the Director, Office of Management and Budget, should expand IPIA guidance to provide criteria that federal agencies should consider when developing a plan or methodology for estimating a national improper payment estimate for state-administered programs, such as criteria that address the nature and extent of data and documentation needed from the states to calculate a national improper payment estimate.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open

    Comments: On August 10, 2006, OMB issued its revised guidance to implement the Improper Payments Information Act of 2002 (IPIA)--OMB Circular No. A-123, Appendix C "Requirements for Effective Measurement and Remediation of Improper Payments." OMB expanded its guidance to define federally funded state-administered programs and provided that federal agencies, upon the approval of OMB, could implement alternative methodologies for generating a national improper payment estimate for state-administered programs such as a systematic selection of States each year. The IPIA guidance provides that as part of the justification for using an alternative methodology, the federal agency must include a description of the States selected each year, the methodology for generating annual national estimates, and basis for using an alternative approach rather than the required methodology to calculate the national estimate based on a random statistical sample. While this revision, if fully and effectively implemented, may improve OMB's ability to carry out its oversight responsibilities with respect to determining appropriate methodologies to be employed in generating a program's improper payment estimate, these revisions did not include criteria that agencies should consider in developing plans or methodologies for estimating a national improper payment estimate for state-administered programs--the essence of our recommendation. In fiscal year 2017, we sent a follow inquiry to the OMB to get an update of actions it has taken to address this recommendation. As of August 24, 2017, no updated information has been provided by the OMB. We will continue to monitor the status of this recommendation.
    Director: Daly, Kay L
    Phone: 2025124063

    2 open recommendations
    Recommendation: To help ensure that Transportation components implement reliable cost accounting methodologies for use in managerial decision making in accordance with departmental objectives, the Secretary of Transportation should direct appropriate department officials to finalize and issue a policy for implementing MCA departmentwide.

    Agency: Department of Transportation
    Status: Open

    Comments: Transportation initiated a major, multi-year department-wide program to re-engineer their financial processes, including cost accounting. Because of the complexity of cost accounting and the complications of the next release of their financial software, Transportation has told us that cost accounting is scheduled as a future process to be reviewed. As a result, Transportation has not yet implemented this recommendation to finalize and issue a policy for implementing MCA departmentwide.
    Recommendation: To help ensure that Transportation components implement reliable cost accounting methodologies for use in managerial decision making in accordance with departmental objectives, the Secretary of Transportation should direct appropriate department officials to finalize and issue formal procedures, revised as necessary, to monitor implementation of that policy and establish a sound system of controls.

    Agency: Department of Transportation
    Status: Open

    Comments: Transportation initiated a major, multi-year department-wide program to re-engineer their financial processes, including cost accounting. Because of the complexity of cost accounting and the complications of the next release of their financial software, Transportation has told us that cost accounting is scheduled as a future process to be reviewed. As a result, Transportation has not finalized or issued a policy for implementing MCA departmentwide.
    Director: Fleming, Susan A
    Phone: 2025128984

    4 open recommendations
    Recommendation: To improve Amtrak's efforts in addressing financial management challenges and better support management decision making, the president of Amtrak should perform a comprehensive risk assessment of financial reporting processes that support preparation of monthly performance reports and the RPI, to include determining areas of vulnerability, implementing appropriate compensating and mitigating internal controls, and ongoing monitoring to ensure compliance.

    Agency: National Railroad Passenger Corporation
    Status: Open

    Comments: GAO is continuing to work with Amtrak to obtain information on the status of this recommendation and will update provide updates as available.
    Recommendation: To improve Amtrak's efforts in addressing financial management challenges and better support management decision making, the president of Amtrak should document policies and procedures related to controlling the information in the monthly performance reports, including the RPI. The policies and procedures should cover how expenses are allocated to Amtrak's routes, as well as specific guidance on documenting the justification and authorization of changes made to allocation methods.

    Agency: National Railroad Passenger Corporation
    Status: Open

    Comments: We will continue to work with Amtrak to obtain information about the status of this recommendation and will provide updates as available.
    Recommendation: To improve Amtrak's efforts in addressing financial management challenges and better support management decision making, the president of Amtrak should develop a comprehensive action plan for immediately implementing preventive controls to enhance the reliability of financial data and address the reportable condition over accounting for capital assets in the most recent reports and letters of comment from the independent public accountant.

    Agency: National Railroad Passenger Corporation
    Status: Open

    Comments: We will continue to work with Amtrak to obtain information about this recommendation and will provide updates as available.
    Recommendation: To ensure that Amtrak can better meet the challenge of increasing its efficiency and reducing its operating costs, the president of Amtrak should establish efficiency and unit cost measures with clear inputs to benchmark individual asset and corporate productivity, which will demonstrate efficient use of Amtrak's resources.

    Agency: National Railroad Passenger Corporation
    Status: Open

    Comments: We will continue to work with Amtrak to obtain information about the status of this recommendation and will provide updates as available.
    Director: Engel, Gary T
    Phone: (202)512-8815

    2 open recommendations
    including 2 priority recommendations
    Recommendation: In the interim, until the joint task force is established and a strategic plan is developed, the Director of OMB should direct the Controller of OMB, in coordination with the Fiscal Assistant Secretary of the Treasury, to work with Justice and certain other executive branch agencies to ensure that these agencies report or disclose relevant criminal debt information in conformity with GAAP in their financial statements and have such information subjected to audit.

    Agency: Executive Office of the President: Office of Management and Budget
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury plans to provide guidance in the FY 2017 Treasury Financial Manual 2-4700 on the process to be followed by federal agencies to report and disclose relevant criminal debt information. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Recommendation: The Secretary of the Treasury should direct the Fiscal Assistant Secretary to include relevant criminal debt information in the CFS or document the specific rationale for excluding such information.

    Agency: Department of the Treasury
    Status: Open
    Priority recommendation

    Comments: As of the completion of our fiscal year 2016 consolidated financial statements (CFS) audit, Treasury and OMB agreed that this recommendation remained open. Treasury plans to provide guidance in the FY 2017 Treasury Financial Manual 2-4700 on the process to be followed by federal agencies to report and disclose relevant criminal debt information. We will follow-up on progress made by Treasury and OMB as part of our fiscal year 2017 CFS audit, which is ongoing as of March 2017.
    Director: Williams, Mccoy
    Phone: (202)512-3000

    2 open recommendations
    Recommendation: The Senior Civilian Official for the Office of the Assistant Secretary of the Navy should develop a review process so that data call information on sponsor owned material is correctly reported.

    Agency: Department of Defense: Department of the Navy: Office of the Assistant Secretary of the Navy (Financial Management): Senior Civilian Official
    Status: Open

    Comments: According to Navy officials, sponsor owned material is a subset of Operating Materials and Supplies (OM&S) contained within the OM&S--Remainder (OM&S-R) category. The Navy's Office of Financial Operations (FMO) is providing direction to the various Navy budget submitting offices (BSOs) to guide the development of a complete, accurate, and validated population of the OM&S-R balances reported in the Navy's financial statements--to include sponsor owned material. Specifically, FMO is working with the BSOs to develop a review process in which the BSOs will reconcile their Accountable Property System of Record asset listings to the Navy's financial statements on a quarterly basis. FMO has performed a reconciliation for the third and fourth quarter of fiscal year 2016, and is currently performing a reconciliation for the first quarter of fiscal year 2017. However, FMO has yet to achieve a 100 percent accurate reconciliation. According to Navy FMO officials, the projected implementation date for this review process is expected to be after September 30, 2017. We will continue to follow-up on this recommendation.
    Recommendation: The Senior Civilian Official for the Office of the Assistant Secretary of the Navy should revise the Navy's policies for compiling its financial statements so that they are in accordance with federal accounting standards and the DOD Financial Management Regulation. Specifically: (1) ammunition items needing repair and those categorized as excess, obsolete, and unserviceable should be revalued appropriately to comply with SFFAS No. 3 and the DOD Financial Management Regulation; and (2) shipboard inventories aboard smaller combatant ships should be reported as operating materials and supplies in accordance with federal accounting standards.

    Agency: Department of Defense: Department of the Navy: Office of the Assistant Secretary of the Navy (Financial Management): Senior Civilian Official
    Status: Open

    Comments: Regarding the first part of this recommendation, Navy's procedures for financially reporting ammunition items deemed excess, obsolete, or unserviceable and ammunition items needing repair are not in compliance with federal accounting standards. The Statement of Federal Financial Accounting Standard Number 3 (SFFAS 3) states that excess, obsolete, and unserviceable operating material and supplies shall be valued at their net realizable value. The standard further states that repair costs for inventory held for repair must be accounted for and adjusted accordingly based on the method of accounting used. Specifically, for ammunition items needing repair, entities should revalue, or reduce, such items by the estimated repair costs for financial statement reporting purposes. However, the Navy is currently devaluing its excess, obsolete, and unserviceable ammunition to zero and reporting it as such on the financial statements. Further, although the Navy has identified an annual maintenance cost for ammunition items needing repair, the Navy currently does not devalue its ordnance, or ammunition, amounts by the estimated repair costs. The Navy contends that these are routine maintenance events and will elect to expense the ordnance maintenance cost as it is incurred in opposition to SFFAS 3. Regarding the second part of this recommendation, SFFAS 3 states that Operating Materials and Supplies (OM&S) should be accounted for using the consumption method; in that materials are to be reported as an asset until they are issued to an end user for consumption in normal operations, at which point they would be expensed. Navy acknowledges, in its fiscal year 2016 financial statements, that due to current system limitations, the consumption method of accounting for all of the Navy's OM&S is not feasible, although long-term efforts are underway to transition to the consumption method for the recognition OM&S expenses to address this previously identified material weakness. Until these efforts are completed, the Navy has granted the Fleet Forces Command and Pacific Fleet a waiver to account for OM&S utilizing the purchase method of accounting. Under the purchase method, the OM&S supplies are expensed upon purchase for the smaller combatant command ships, as opposed to federal accounting standards requiring them to be recognized as an asset on the balance sheet and then expensed when consumed in the normal course of operations. We will continue to follow-up on this recommendation and the related issues in future Navy Operating Material and Supplies audit work.