OFFICE OF
THE INSPECTOR GENERAL
SOCIAL SECURITY ADMINISTRATION
SINGLE AUDIT OF THE
DEPARTMENT OF THE FAMILIY
FOR THE FISCAL YEAR
ENDED JUNE 30, 2007
August 2009 A-77-09-00012
By conducting independent and
objective audits, evaluations and investigations, we inspire public confidence
in the integrity and security of SSA’s programs and operations and protect them
against fraud, waste and abuse. We provide
timely, useful and reliable information and advice to Administration officials,
Congress and the public.
Authority
The Inspector General Act created
independent audit and investigative units, called the Office of Inspector
General (OIG). The mission of the OIG,
as spelled out in the Act, is to:
m Conduct
and supervise independent and objective audits and investigations relating to
agency programs and operations.
m Promote
economy, effectiveness, and efficiency within the agency.
m Prevent
and detect fraud, waste, and abuse in agency programs and operations.
m Review
and make recommendations regarding existing and proposed legislation and
regulations relating to agency programs and operations.
m Keep
the agency head and the Congress fully and currently informed of problems in
agency programs and operations.
To
ensure objectivity, the IG Act empowers the IG with:
m
m Access
to all information necessary for the reviews.
m Authority
to publish findings and recommendations based on the reviews.
Vision
We strive for
continual improvement in SSA’s programs, operations and management by
proactively seeking new ways to prevent and deter fraud, waste and abuse. We commit to integrity and excellence by
supporting an environment that provides a valuable public service while
encouraging employee development and retention and fostering diversity and
innovation.
Date: August 20, 2009 Refer To:
To: Candace
Skurnik
Director
Audit Management and Liaison Staff
From: Inspector General
Subject: Management Advisory Report: Single Audit of the
This report presents the Social
Security Administration’s (SSA) portion of the single audit of the
The audit firm Torres Llompart,
Sanchez Ruiz L.L.P. performed the audit.
We have not received the results of the desk review conducted by the U.S.
Department of Agriculture (USDA). We
will notify you when we receive the results if USDA determines the audit did
not meet Federal requirements. In
reporting the results of the single audit, we relied entirely on the internal
control and compliance work performed by Torres Llompart, Sanchez Ruiz L.L.P.,
and the reviews performed by USDA. We
conducted our review in accordance with the Quality
Standards for Inspections issued by the President’s Council on Integrity
and Efficiency.[1]
For single audit purposes, the
Office of Management and Budget (OMB) assigns Federal programs a Catalog of
Federal Domestic Assistance (CFDA) number.
SSA’s Disability Insurance (DI) and Supplemental Security Income (SSI)
programs are identified by CFDA number 96.
SSA is responsible for resolving single audit findings reported under
this CFDA number.
The Puerto Rico Disability
Determination Services (DDS) performs disability determinations under SSA’s DI
program in accordance with Federal regulations.
The Puerto Rico DDS is reimbursed for 100 percent of allowable
costs. The PRDF is the Puerto Rico DDS’
parent agency.
The single audit reported PRDF:
1.
Did not submit the single audit report
to OMB’s Federal Audit Clearinghouse within 9 months after the fiscal
year-end (Attachment A, Page 1). The corrective action plan[2]
indicates PRDF will establish reliable and effective processes to comply with
the reporting requirements.[3]
2.
Had deficient accounting policies,
procedures, and financial reporting practices including a lack of a self-balancing
set of accounts, inappropriate, and/or incomplete monthly and year-end
closing procedures (Attachment A, Pages 2 through 4). The corrective action plan indicated that a customized
application system was being developed that will provide accurate and complete
financial and budgetary information.3
3.
Had an inadequate filing system that did
not permit the prompt retrieval of payment and other documents requested (Attachment
A, Pages 5 and 6). The corrective action plan indicated a Document
Control System was developed that includes a Central File Division to maintain the
supporting documents of all fiscal transactions.3
4.
Had multiple documents missing
from personnel files and payroll transactions that were not being properly
monitored (Attachment A, Pages 7 through 10). The corrective action plan indicated that a taskforce was
organized to review 3,000 personnel files to verify full compliance with all State
regulations.3
5.
Did not have adequate procedures and
controls over the timing of cash draws for SSA’s disability program and
therefore was not in compliance with OMB Circular A-102 (see Attachment A,
Pages 11 through 15). PRDF
disagreed with this finding; therefore, no corrective action was indicated in
the report.
6.
Did not have an effective property and
equipment system (Attachment A, Page 16 through 18). The corrective action plan indicated that PRDF was developing
a customized automated Property Management System.3
7.
Charged expenditures totaling $196,389 to
SSA for obligations that were incurred after the end of the period of
availability (see Attachment A, Pages 19 through 23). The corrective action plan indicates PRDF will implement a
mechanized application of budget control and financial transaction's register
for Federal and State funds that will facilitate fiscal compliance with Federal
regulations.
We recommend that SSA:
1.
Ensure PRDF’s cash draws for SSA’s
disability program are in accordance with OMB Circular A-102.
2.
Determine whether obligations recorded after
the period of availability resulted in unallowable charges and if so, request a
refund of the unallowable costs.
Please send copies of the
final Audit Clearance Document to Ken Bennett.
If you have questions contact Ken Bennett at (816) 221‑0315
extension 1558.
Patrick
P. O’Carroll, Jr.
Attachments
Overview of the Office of the Inspector General
The Office of the Inspector General (OIG) is comprised of an
Office of Audit (OA), Office of Investigations (OI), Office of the Counsel to
the Inspector General (OCIG), Office of External Relations (OER), and Office of
Technology and Resource Management (OTRM).
To ensure compliance with policies and procedures, internal controls,
and professional standards, the OIG also has a comprehensive Professional
Responsibility and Quality Assurance program.
Office of Audit
OA conducts financial and performance audits of the Social
Security Administration’s (SSA) programs and operations and makes
recommendations to ensure program objectives are achieved effectively and
efficiently. Financial audits assess
whether SSA’s financial statements fairly present SSA’s financial position,
results of operations, and cash flow.
Performance audits review the economy, efficiency, and effectiveness of
SSA’s programs and operations. OA also
conducts short-term management reviews and program evaluations on issues of
concern to SSA, Congress, and the general public.
Office of Investigations
OI conducts investigations related to fraud, waste, abuse, and
mismanagement in SSA programs and operations.
This includes wrongdoing by applicants, beneficiaries, contractors,
third parties, or SSA employees performing their official duties. This office serves as liaison to the Department
of Justice on all matters relating to the investigation of SSA programs and
personnel. OI also conducts joint
investigations with other Federal, State, and local law enforcement agencies.
Office of the Counsel to the Inspector General
OCIG provides independent legal advice and counsel to the IG on
various matters, including statutes, regulations, legislation, and policy
directives. OCIG also advises the IG on
investigative procedures and techniques, as well as on legal implications and
conclusions to be drawn from audit and investigative material. Also, OCIG administers the Civil Monetary
Penalty program.
Office of External Relations
OER manages OIG’s external and public affairs programs, and serves
as the principal advisor on news releases and in providing information to the
various news reporting services. OER
develops OIG’s media and public information policies, directs OIG’s external
and public affairs programs, and serves as the primary contact for those
seeking information about OIG. OER
prepares OIG publications, speeches, and presentations to internal and external
organizations, and responds to Congressional correspondence.
Office of Technology and Resource Management
OTRM supports OIG by providing information management and systems
security. OTRM also coordinates OIG’s
budget, procurement, telecommunications, facilities, and human resources. In addition, OTRM is the focal point for
OIG’s strategic planning function, and the development and monitoring of
performance measures. In addition, OTRM receives
and assigns for action allegations of criminal and administrative violations of
Social Security laws, identifies fugitives receiving benefit payments from SSA,
and provides technological assistance to investigations.
[1] In January 2009, the President’s Council on Integrity and Efficiency was superseded by the Council of the Inspectors General on Integrity and Efficiency, Inspector General Reform Act of 2008, Pub. L. No. 110‑409 § 7, 5 U.S.C. App. 3 § 11.
[2] The corrective action plans contained in the Single
Audit of the
[3]
This finding and
OIG’s recommendation were reported in the Management Advisory Report: Single Audit of the