National Endowment for the Arts Office of Inspector General Semiannual Report to Congress

During the semiannual period, NEA OIG issued nine reports, which contained forty recommendations based on audits and evaluations. Twenty recommendations were related to NEA programs and twenty were related to NEA grantees. Three recommendations related to NEA grantees were cleared during this reporting period. We also issued one memorandum to the agency related to a NEA grantee which contained one recommendation. The agency implemented the recommendation during this reporting period. We conducted a joint investigation with the OIGs of the National Science Foundation (NSF) and the National Endowment for Humanities (NEH), of a Massachusetts public broadcasting company for allegedly failing to properly track and account for Federal grant funds. Our investigation found that the broadcasting company could not demonstrate that project costs charged to the Federal grants from the three agencies were reasonable, allowable, and allocable. The U.S. Attorney’s Office entered into a civil settlement whereby, without admitting liability, the company repaid $300,173—of which $1,747 was associated with NEA funds—and entered into a five-year compliance plan to strengthen its oversight of Federal funds. The 2012 Financial Statement Audit Report was issued November 8, 2012, and resulted in an unqualified (clean) opinion. The FY 2012 FISMA evaluation concluded that although NEA made progress in complying with FISMA, some additional improvements were needed.