Improvements Needed in Controlling and Accounting for Treasury Banking Arrangements
AFMD-85-22
Published: Apr 03, 1985. Publicly Released: Apr 03, 1985.
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Highlights
GAO reported on controlling and accounting for the Department of the Treasury's banking arrangements with commercial banks for handling federal agencies' deposits.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Treasury | The Secretary of the Treasury should examine alternative controls for preventing and detecting bank delays in transferring agencies' deposits. These alternatives should include requiring agencies, rather than commercial banks, to initiate automated clearinghouse funds transfers from the Treasury General Account banks to Treasury's Federal Reserve account. |
Treasury stated that it is not in a position, at this time, to examine alternative controls. Treasury wants to try to implement an automated system for identifying fund transfer delays before considering this recommendation.
|
| Department of the Treasury | The Secretary of the Treasury should advise federal agencies of their responsibilities for detecting bank delays. |
Treasury issued a Treasury Financial Manual Bulletin to advise the agencies how to date deposit slips. However, the bulletin did not instruct the agencies on how to use those dates to detect bank delays. Treasury plans no additional work.
|
| Department of the Treasury | The Secretary of the Treasury should evaluate whether Federal Reserve operation of the revised Treasury General Account system would produce greater control at less overall cost to the government. |
Treasury will consider any Federal Reserve offers to operate the system.
|
| Department of the Treasury | The Secretary of the Treasury should charge all banks delaying funds transfers. |
Treasury officials stated that the monitoring system that has been installed will facilitate charges for delays.
|
| Department of the Treasury | The Secretary of the Treasury should establish control standards for monitoring lockbox collections that must be implemented by all agencies using those systems. |
Treasury is drafting the necessary standards and is including these in the Treasury Financial Manual to be issued in December 1987.
|
| Department of the Treasury | The Secretary of the Treasury should determine whether it would be cost-effective to revise current procedures to allow the Federal Reserve to accept all funds received through TFCS, even though agency identification may be inaccurate. |
The Financial Management Service's policy requires that accurate data be entered into the accounting system. Treasury does not believe there is a feasible alternative, therefore, this recommendation is no longer valid since Treasury has discontinued TFCS.
|
| Department of the Treasury | The Secretary of the Treasury should include costs of compensating banks for banking services in the Department's annual appropriation request. |
The budget submission states that the budget does not include compensation to banks from the use of government balances for facilitating the collection and control of government receipts. However, the submission does not specify the amount of the compensation. Treasury plans no further action.
|
| Department of the Treasury | The Secretary of the Treasury should consistently monitor bank charges and compensation to ensure that the overall costs to the government are minimized. |
According to agency officials, Treasury developed and implemented a system to monitor bank charges and compensation.
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Topics
Bank depositsDeposit fundsFinancial analysisFinancial managementFunds managementInsured commercial banksInternal controlsMonitoringTransfer paymentsPostal service