Federal Reports

During fiscal year 2015, the National Institutes of Health (NIH) did not always administer Superfund appropriations in accordance with applicable Federal requirements. NIH generally obligated and disbursed Superfund appropriations; however, NIH had not (1) always ensured that Superfund grantees complied with grant terms and conditions, (2) properly recorded Superfund grant disbursements in the NIH accounting system, and (3) always resolved audit findings contained in grantee audit reports.

Homeland Security Presidential Directive (HSPD) 12 requires that Federal agencies implement a government-wide standard for secure, reliable identification for their employees and contractors to access facilities and systems. ur objective was to assess DHS’ progress in implementing and managing the HSPD-12 program since our prior audits in 2007 and 2010. The Department of Homeland Security has not made much progress in implementing and managing requirements of the HSPD-12 program department-wide. Many of the same issues we previously reported in 2007 and 2010 pose challenges today.

When Arizona billed manufacturers for rebates for pharmacy and physician-administered drugs, it did so correctly. However, Arizona did not bill for and collect from manufacturers estimated rebates of $36.7 million ($25.6 million Federal share) for physician-administered drugs. For drugs that were eligible for rebates, Arizona did not bill for estimated rebates of $18.3 million (Federal share) for single-source and top-20 multiple-source physician-administered drugs. For drugs that may have been eligible for rebates, Arizona did not bill for estimated rebates of $7.3 million (Federal share) for other physician-administered drugs. Arizona did not always bill for and collect from manufacturers rebates because it did not have a system edit to ensure that National Drug Codes (NDCs) or valid NDCs were submitted for physician-administered drugs before October 1, 2012. Even after Arizona implemented the edit on October 1, 2012, this edit did not ensure that NDCs or valid NDCs were captured for all physician-administered drugs.

Audit Report

The OIG reviews decision analysis reports (DARs) in advance of Investment Review Committee (IRC) meetings to determine whether the requested investments are reasonable business decisions and are in the best interest of the U.S. Postal Service.In FY 2017, the OIG evaluated 64 DARs totaling $2.9 billion that required the Postal Service Headquarters Finance team’s validation and subsequent IRC approval or disapproval. We provided our individual reviews to DAR sponsors and the IRC considered these reviews during its approval process. Six of the 64 investment requests that we reviewed (totaling $1.42 billion) were subsequently canceled prior to receiving the Postmaster General’s approval.We determined that all DARs reviewed in FY 2017 were reasonable business decisions or in the best interest of the Postal Service; however, we identified concerns for eight DARs that totaled $218.8 million.

The Federal Emergency Management Agency (FEMA) estimated that the City of Cedar Falls, Iowa (City), had sustained approximately $893,000 in damage caused by severe storms and flooding from September 21 through October 3, 2016. We audited early in the grant process to identify areas in which the City may need additional technical assistance or monitoring to ensure compliance with Federal procurement requirements. Except for procurement, the City’s policies, procedures, and business practices appear to be adequate to account for and expend FEMA grant funds according to Federal regulations and FEMA policies. Specifically, the City’s procurement policies did not provide sufficient opportunities for disadvantaged firms to compete for contracts, or prevent awarding contracts to debarred or suspended contractors. After we discussed these issues, City officials moved quickly to modify procurement policies to comply with Federal requirements.