January 25, 2018 The Honorable Mick Mulvaney Director c/o Stannis Smith Office of Management and Budget 725 17th Street NW Washington, DC 20503 Dear Mr. Mulvaney: The Government Charge Card Abuse Prevention Act of 2012 (Charge Card Act) and Office of Management and Budget’s (OMB’s) implementing guidance require each office of inspector general (OIG) to perform periodic risk assessments of agency purchase card and travel card programs to identify and analyze the risks of illegal, improper, or erroneous purchases and payments. Where annual travel card spending for an agency exceeds $10 million, the Charge Card Act and OMB M-13-21 require periodic audits or reviews of the agency’s travel card program. OIGs must also submit an annual purchase and travel card audit recommendation status report to OMB. Below is a summary of the actions we have taken during fiscal year (FY) 2017 to fulfill these requirements, as well as additional information on our related work. We conducted a risk assessment of the Denali Commission’s (the Commission’s) purchase and travel card program to assess the risks of illegal, improper, or erroneous purchases and payments associated with the Commission’s purchase and travel card program. We reviewed the annual amount of purchase and travel card spending during FY 2017, the number of cardholders, internal control processes and procedures, and the results of prior reviews and audits. For FY 2017, the Commission reported there were two purchase cardholders with expenditures totaling $88,183, and 14 travel cardholders with expenditures totaling $130,330. The Commission did not meet the threshold of $10 million in purchase card spending and, consequently, we were not required to submit semiannual reports to OMB regarding purchase card violations. Further, because travel card expenditures for FY 2017 were significantly less than the $10 million threshold, an audit of the travel card program is not required. We completed an audit1 of the Commission’s purchase card program and issued our report in September 2016, in which we made four recommendations to strengthen internal control in the Commission’s purchase card program. During FY 2017, the Commission implemented and closed the four recommendations (see enclosure). As of the end of FY 2017, the Commission has no unimplemented or unresolved recommendations related to purchase and travel cards; therefore, an audit recommendation status report to OMB is not required. 1 Denali Commission Office of Inspector General, September 28, 2016. Improvements Are Needed in the Denali Commission Government Purchase Card Program, DCOIG-16-008-A. Anchorage, AK: Denali OIG. Based on the audit work completed in FY 2017, implementation of recommendations, and relatively low volume of purchases and low number of cardholders, we concluded that the risk of illegal, improper, or erroneous purchases and payments through the Commission’s purchase and travel card programs during FY 2017 was low. Nevertheless, in an effort to provide routine oversight of administrative operation, we initiated an audit of the Commission’s use of government travel cards in March 2017. Work related to that government travel card audit is still ongoing. However, we believe that additional reviews or audits of the Commission’s use of the government purchase card during FY 2018 are not warranted. If you have any questions, please contact me at (202) 482-3884. Sincerely, Mark H. Zabarsky Principal Assistant Inspector General for Audit and Evaluation U.S. Department of Commerce Office of Inspector General Enclosure 2 Enclosure. Status of Government Purchase Card Audit Recommendations Card Type Recommendation Status 1. We recommend that the Commission strengthen internal control in its purchase card program by updating internal Purchase guidance to better reflect federal requirements with regard to Closed purchase card transactions and documentation and emphasizing the importance of following guidance when making purchases. 2. We recommend that the Commission strengthen internal control in its purchase card program by removing access to Purchase Closed the online purchase card management system from staff no longer employed by the Denali Commission. 3. We recommend that the Commission strengthen internal control in its purchase card program by including a procedure Purchase Closed during the off-boarding process to verify any access to the online purchase card management system is removed. 4. We recommend that the Commission strengthen internal control in its purchase card program by updating the purchase Purchase card merchant category code template to reduce risk and Closed revising the allowed merchant category codes for current cardholders. Source: Denali Commission OIG Report No. DCOIG-008-A 3
Government Charge Card Abuse Prevention Act FY18 Letter to OMB
Published by the Denali Commission, Office of Inspector General on 2018-01-01.
Below is a raw (and likely hideous) rendition of the original report. (PDF)