Federal Reports

This report presents the results of our evaluation of the U.S. Small Business Administration’s (SBA) handling of cash contributions and gifts. The objective of the evaluation was to determine the adequacy of SBA controls over the solicitation, acceptance, holding, and use of cash contributions and gifts.We found that SBA complied with the 2021 Consolidated Appropriations Act, SBA regulations and policies regarding soliciting and accepting cash contributions for National Small Business Week 2021. SBA’s Office of Communications and Public Liaison obtained proper approval from the Office of General Counsel for the 2021 National Small Business Week cosponsored activity.We recommended the agency enhance the tracking system with alerts to ensure responsible officials close out all cosponsored activities within 90 days, as required. We also recommended the agency implement quality control procedures to ensure that required fiscal agent and SBA documents for future National Small Business Week cosponsored activities are timely, complete, accurate, and can be relied on.SBA management agreed with both of our recommendations.

The Office of the Inspector General identified several instances where time was not accurately reported in the Personnel Qualification and Scheduling program (that is used to track employees’ hours to avoid a violation of the Nuclear Fatigue Rule) and the time-reporting system. However, we were unable to determine if all Nuclear Maintenance employees’ time was accurately reported because we could not account for time that employees were not badged into the protected areas (the area encompassed by physical barriers and to which access is controlled) of the plants. The inaccurate reporting resulted in a violation of the Nuclear Fatigue Rule, unnecessary paid time off for an employee, and overstated leave balances.

Our objective for this report was to assess the effectiveness of the company’s controls over payment requests.The company has a process that allows its employees to expeditiously make non-recurring and low-dollar purchases and certain high-dollar payments, subject to certain criteria. Known as “payment requests,” we found that the company’s controls over payment requests appeared to be generally effective in ensuring purchases were made for valid business purposes and that it correctly paid its vendors. We identified, however, opportunities to improve internal controls impacting its payment request process.To address the report’s findings, we recommended that the company more comprehensively and periodically analyze its payment request data to identify patterns of possible non-compliance and opportunities in which the company could do more to protect its interests and get a better value for its purchases through a contract.

Our evaluation objective was to determine whether the Department and its bureaus are managing national security systems in compliance with federal and Departmental information technology security requirements.We found the following:I. The Department mismanaged and neglected information technology security requirements for its national security systems.II. The Department wasted at least $380,000 on a national security system that it did not use.

The VA Office of Inspector General (OIG) contracted with the independent public accounting firm CliftonLarsonAllen LLP (CLA) to provide consulting services to the OIG with respect to selected financial reporting controls for the Integrated Financial and Acquisition Management System (iFAMS) at the National Cemetery Administration (NCA). VA is implementing iFAMS using an incremental approach with the first deployment having occurred at NCA in November 2020. The nature and scope of work for this consulting engagement was determined solely by agreement between the OIG and CLA and did not constitute an audit.In its consulting letter, CLA provided the OIG with observations and potential risks in such categories as obligations, reconciliations, opening balances, procurement, and intragovernmental transactions. The OIG shared this letter with management for their awareness, and CLA included management’s comments in its letter.

The attached report presents the results of the independent certified public accountants’ audit of the Western Federal Power System’s combined balance sheets, as of September 30, 2021, and 2020, and the related combined statements of revenues and expenses, changes in capitalization, and cash flows for the years then ended.To fulfill the Office of Inspector General’s audit responsibilities, we contracted with the independent public accounting firm of KPMG LLP (KPMG) to conduct the audit, subject to our review. KPMG is responsible for expressing an opinion on the Western Federal Power System’s financial statements and reporting on applicable internal controls and compliance with laws and regulations. The Office of Inspector General monitored audit progress and reviewed the audit report and related documentation. This review disclosed no instances where KPMG did not comply, in all material respects, with generally accepted government auditing standards. The Office of Inspector General did not express an independent opinion on the Western Federal Power System’s financial statements.KPMG concluded that the combined financial statements present fairly, in all material respects, the financial position of the Western Federal Power System as of September 30, 2021, and 2020, and the results of its operations and its cash flows for the years then ended in accordance with United States generally accepted accounting principles. As part of this audit, auditors also considered the Western Federal Power System’s internal controls over financial reporting and tested for compliance with certain provisions of laws, regulations, contracts, and grant agreements that could have a direct and material effect on the combined financial statements. The audit did not identify any deficiency in internal control over financial reporting that is considered a material weakness. The results of the auditors’ review of the Western Federal Power System’s compliance with provisions of laws and regulations disclosed no instances of noncompliance or other matters required to be reported under Government Auditing Standards.

NASA’s Earth Science Disasters Program uses observations from Earth-observing satellites to provide data and information products to U.S. and global entities to help predict, prepare for, respond to, and recover from natural, human-caused, and technological disasters. In this report, we assessed NASA’s management of the Program.