Financial Management: The U.S. Mint's Accounting and Control Problems Need Management Attention

Mint directives were revised in October 1989 to require quarterly die inventories by total number and face. A quarterly inventory was taken March 1990. Of the four field Mints, only San Francisco Mint noted discrepancies between the physical inventory and die records. As of June 1991, all four field Mint die inventories were completed with no discrepancies.

Mint directives were revised to require an annual inventory of dies by serial number. If the quarterly inventories show discrepancies, a follow-up inventory by serial number will be performed after the quarterly inventory. Since December 1990, inventories have been completed at all four field Mints by serial number with no discrepancies noted.

Mint headquarters has established a die inventory tracking system and it is being used by the San Francisco Mint to track the movement of dies between the die room and chroming.

Field mints were instructed orally to report all unreconciled die discrepancies to Treasury IG staff and Mint police. The revised Mint Directive, MD 16B-1, also contains these requirements. Both IG and the San Francisco Mint Security Office were notified of unreconciled die inventory amounts, as required.

The revised directive, MD 16B-1, contains a provision requiring the head of each field mint to appoint a representative independent of the Coining Division to conduct all die inventories. Referral of unresolved items to Mint Security and the Inspector General, as required, provides for independent review.

On August 15, 1989, the Director of the Mint issued a reminder to San Francisco that all shortages of coins, blanks, and dies are to be reported to Mint police. The Director also visited San Francisco in September 1989 to ensure procedures were followed. At that time, disciplinary actions were taken against managers who had not taken appropriate actions to report shortages.

The December 1989 FMFIA report noted that online terminals to track die information were placed in production areas Mint-wide. In July 1990, the Mint tested controls over dies at the field mints and no weaknesses were reported. The new Mint-wide Die Information System was fully operational on August 1, 1990 and satisfactorily addresses this recommendation.

The Mint has implemented an interim cost accounting system, and it will be testing a fully integrated system in 1994. Mint management attests to the reliability of this information, which is based on revised cost accounting standards. The system provides managers with timely cost, revenue, production, and sales information reports, which are used for decisionmaking.

In October 1988, the Mint began developing an automated funds control system. The Mint's funds control system is operational at all locations. Mint financial plans are the basis for controlling obligations and Mint funds control reports now show balances available for obligation.

Improved management information reports are available by coin program showing costs, revenues, coins produced, and coins sold. Reports include graphics based on financial data derived from the system for trend analysis. Mint managers attest that these reports are used to manage programs and costs.

The Mint has issued and used Interim Cost Accounting Policies and Procedures Manuals since October 1992. The procedures are referred to as interim because the Mint plans to integrate this system with its primary accounting system. The Mint has documented its automated funds control system and plans to draft Bureau-level policies and procedures required by OMB Circular A-34 after its new financial management system is fully integrated. Full integration of cost accounting and funds control subsystems with the Mint's new Information Financial Management System (IFMS) is targeted for late 1996. In the interim, the Mint has adopted the Treasury Department's administrative procedures for funds control.