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Highlights

The Federal Retirement Thrift Investment Board (FRTIB) is charged with managing the Thrift Savings Plan (TSP)--a key component of retirement savings for many federal employees--in the interest of its participants and beneficiaries. As part of a broader request on oversight of FRTIB, GAO reviewed (1) the administrative expenses of FRTIB and key components of these expenses, (2) whether the administrative expenses of FRTIB are the result of practices consistent with federal regulations and similar functions at other agencies, and (3) FRTIB's current method of benchmarking administrative expenses. GAO reviewed FRTIB's budgets, audited financial statements, a benchmarking study, and written responses to questions that GAO submitted. GAO also reviewed the regulations that guide FRTIB's spending.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Federal Retirement Thrift Investment Board To ensure that FRTIB continues to operate as efficiently as possible, the board should direct the Executive Director to continue monitoring both the square footage and cost per square foot of office space in the future to ensure that it is appropriate for its needs. In addition, FRTIB should consider expanding its use of telecommunications for its monthly board members' meetings, as appropriate.
Closed - Not Implemented
In light of recent declines in staff size at the Federal Retirement Thrift Investment Board (FRTIB) and the agency's current renting of more space per person than GSA recommends, our May 14, 2007 report on FRTIB's administrative expenses recommended that FRTIB consider the square footage and cost per square foot of office space to ensure that it is appropriate for its needs. In response to our recommendation, FRTIB commissioned a study by a real estate advisor. In a FRTIB public meeting on February 19, 2008, board members discussed our recommendation and the results of the study. Although FRTIB decided to maintain its current office space, it stated that it would revisit the issue again next year when the current FRTIB lease approaches expiration. However, in 2009, after revisiting the issue, FRTIB decided to not relocate. FRTIB has not reconsidered its use of telecommunications.
Federal Retirement Thrift Investment Board To provide the board with the most complete and relevant information with which to assess the expenses and performance of administrative functions of FRTIB, the board should direct the Executive Director to move beyond the comparison of participant costs against those for other 401(k) plans to benchmarking cost and performance of individual activities--either against similar activities elsewhere or against validated criteria or standards, such as federal regulations.
Closed - Not Implemented
When we issued GAO-07-541, FRTIB disagreed with our recommendation that it expand its benchmarking practices. FRTIB has not changed its position on this recommendation.

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