oversight

FY 2004-2005

Published by the Farm Credit Administration, Office of Inspector General on 2003-07-07.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

Office of
Inspector General


               OPERATING AND PERFORMANCE
                          PLAN
                  FISCAL YEARS 2004-2005




                    Farm Credit Administration
Farm Credit Administration                            Office of Inspector General
                                                      1501 Farm Credit Drive
                                                      McLean, Virginia 22102-5090




July 7, 2003


The Honorable Michael M. Reyna
Chairman and Chief Executive Officer
Farm Credit Administration
1501 Farm Credit Drive
McLean, Virginia 22102-5090

Dear Mr. Reyna:

The enclosed document presents the Office of Inspector General’s (OIG) operating and
performance plan for Fiscal Years 2004 and 2005. Our mission remains the same and
our objectives and goals are similar to that of previous years. We have updated the
annual audit plan to reflect issues from which we select most of our assignments.

The accomplishment of our products and services correlate to fulfilling our goals and
objectives. I do not anticipate any structural changes in the OIG staffing plan.

Please do not hesitate to call me if you have any questions or comments.

Sincerely,




Stephen G. Smith
Inspector General

Enclosure

Copy to: Cheryl Macias
         Chief Operating Officer
                               Office of Inspector General
                             Operating and Performance Plan
                                      FY 2004-2005

                                                      Table of Contents
                                                                                                                                      Page

Mission, Objectives, and Goals.............................................................................................. 1
Assumptions ........................................................................................................................... 2

Performance Measures........................................................................................................... 3
Audit Plan................................................................................................................................ 9

Staffing and Resource Needs and Distribution ..................................................................... 13
Staffing Distribution Chart ..................................................................................................... 17

IRM Plan Summary Report ................................................................................................... 18

FY 2004 Revised Office Performance Budget Spreadsheet................................................. 19
FY 2004 Revised Products and Services by Object Classification Spreadsheet.................. 20
FY 2004 Revised Products and Services ............................................................................. 21
FY 2004 Budget and Justifications ....................................................................................... 23

FY 2005 Proposed Office Performance Budget Spreadsheet .............................................. 25
FY 2005 Proposed Products and Services by Object Classification Spreadsheet ............... 26
FY 2005 Proposed Products and Services ........................................................................... 27
FY 2005 Proposed Budget and Justifications ....................................................................... 29

Budget Detail and Summary for FY 2004-2005 .................................................................... 32
FY 2001-2005 Performance by Projects, Products and Services and Program Activities .... 34

Impact Analysis on Products and Services from a Changing Budget Environment.............. 40
                   Office of Inspector General
                          FY 2004-2005
                  Mission, Objectives and Goals
                                          MISSION
The mission of the Office of Inspector General (OIG) is to be an agent of positive
change, striving for continuous improvement in the Farm Credit Administration’s (FCA
or Agency) management and program operations.

                             OBJECTIVES and GOALS
•   Audit and evaluate the Agency’s programs and operations to promote
    economy, efficiency and effectiveness.
    1. Deliver quality audit and inspection products and services that are useful to the
       Board, management and Congress.
    2. Provide technical advice and assistance to Agency officials in developing sound
       management information and financial reporting systems and in streamlining
       programs and organizations.
    3. Continuously improve OIG staff, products and internal office administration.

•   Investigate observed, alleged or suspected wrongdoing to prevent and
    detect fraud, waste, abuse and mismanagement in Agency programs and
    operations.
    1. Effectively investigate and report administrative and criminal violations relating to
       FCA programs and personnel.
    2. Educate employees on their responsibility to report wrongdoing to the IG.
    3. Provide relevant information on results of investigative activities to relevant parties.

•   Review and make recommendations regarding existing and proposed
    legislation and regulations relating to Agency programs and operations
    and the Inspectors General community.
    1. Maintain an effective program for reviewing and commenting on proposed and
       existing legislation and regulations.

•   Work with the Chairman and Agency management to improve program
    management within the Agency and in our own office; and work with the
    Inspectors General community and other related organizations to address
    government-wide issues.
    1. Build relationships with program managers based on a shared commitment to
       improving program operations and effectiveness.
    2. Provide leadership to the OIG community.
    3. Contribute to special projects to improve the Agency.
                   Office of Inspector General
                          FY 2004-2005
                          Assumptions

1. There will be no structural change in the OIG staffing plan.
2. The Agency will remain competitive in its compensation program.
3. The OIG’s contracting budget will be adequate to obtain additional subject
   matter expertise whenever specific evaluations require it.
4. The OIG’s training budget will be adequate to maintain leadership, technical,
   cultural and collaborative competencies.
                           Office of Inspector General
                      FY 2004/2005 Performance Measures
           Audits and Evaluations of Agency Programs and Operations
AGENCY             OIG                               PERFORMANCE                                                  OUTCOME/
 GOAL             GOAL                                 MEASURE                                                     IMPACT


 1 and 2    1. Deliver quality     Audits and inspections are relevant. Audit coverage           FCA programs and operations are more
              audit, inspection,   includes all mandated audits and at least 75% of those        effective.
              and review           suggested by the Board and management.
              products and                                                                       Waste in Agency programs and operations is
              services that are    Risk is addressed. 100% of OIG audits are performed in        reduced.
              useful to the        high risk/high $ programs and activities and/or are tied to
              Board,               the Agency strategic planning goals.                          Increased Agency compliance with laws,
              management                                                                         regulations and internal policies and
              and/or the           Findings made during audit fieldwork are recognized and       procedures.
              Congress.            corrected by management prior to drafting of the audit
                                   report.                                                       The Agency’s stature and reputation is
                                                                                                 elevated in the eyes of Congress, the
                                   Products are timely, i.e. average time to complete audits     Administration, the FCS, FCA employees and
                                   and issue draft reports will not exceed 6 months.             the public.

                                   Audits are constructive. At least 75% of audit products       FCA is more effective in carrying out its
                                   contain recommendations to improve Agency operations.         mission.
                                   The Agency accepts at least 80% of OIG audit
                                   recommendations.                                              The OIG is more effective in promoting
                                                                                                 economy, effectiveness and efficiency within
                                   The Agency implements all corrective actions prescribed       the Agency.
                                   by management decisions.
                                                                                                 FCA continues to get an unqualified audit
                                                                                                 opinion on financial statements.
                         Office of Inspector General
                    FY 2004/2005 Performance Measures
         Audits and Evaluations of Agency Programs and Operations
AGENCY           OIG                                 PERFORMANCE                                               OUTCOME/
 GOAL           GOAL                                   MEASURE                                                  IMPACT


          (continued)
          2. Provide technical     The IG advises the Chairman concerning policy direction    OIG input and advice contributes to Agency
             advice and            or administrative priorities.                              decisions and actions that are more complete
             assistance to                                                                    and valid at their inception.
             Agency officials in   OIG performs analysis and provides technical advice to
             developing sound      management concerning accounting, management               Increase in management requests for advice,
             management            systems and controls, and performance measures.            review and technical assistance.
             information and
             financial reporting                                                              Peer review reports provide an unqualified
             systems and in                                                                   opinion that OIG audit work meets or exceeds
             streamlining                                                                     quality audit standards prescribed by GAO and
             programs and                                                                     the PCIE/ECIE.
             organizations.

          3. Continuous            Customer survey feedback is used to improve products       Customer survey feedback evidences
             improvement of        and services.                                              increased satisfaction with report practices.
             OIG staff,
             products and          OIG training ensures the technical proficiency of staff.   The Inspector General’s opportunity to facilitate
             internal                                                                         positive change within the Agency is enhanced
             administration.       OIG implements administrative improvements identified      by the quality and credibility of OIG products
                                   through reviews of other Agency programs and through       and advice.
                                   staff involvement with the professional community.
                               Office of Inspector General
                           FY 2004/2005 Performance Measures
                                      Investigations

AGENCY             OIG                               PERFORMANCE                                              OUTCOME/
 GOAL             GOAL                                 MEASURE                                                 IMPACT


 1 and 2   1. Administrative and   Investigative reports are timely and presented in an        Administrative action, convictions or pleas
             criminal violations   objective and factual manner. Memoranda are issued to       are obtained for employees and/or
             relating to FCA       management describing internal control weaknesses or        contractors found guilty of wrongdoing.
             programs and          program deficiencies found during the investigative
             personnel are         process with suggestions to prevent and/or detect future    Management actions taken against
             effectively           wrongdoing.                                                 employees serve as a deterrent to future
             investigated and                                                                  wrongdoing.
             reported.             70% of active cases will be less than two years old (from
                                   the date the case was opened).                              FCA internal policies, procedures and
                                                                                               controls are strengthened to prevent and/or
                                   100% of employee cases without criminal prosecution         detect future wrongdoing.
                                   potential will be completed within one year from opening
                                   the case.


           2. FCA employees        Allegations of wrongdoing are received in a timely
              and managers         manner and are supported by specific information.           Investigations are more successful because
              recognize their                                                                  they are initiated in a timelier manner and
              responsibility to                                                                have better information.
              immediately report
              observed or                                                                      FCA employees are more willing to report
              suspected                                                                        real or suspected wrongdoing because they
              wrongdoing to the                                                                trust the competence and fairness of OIG’s
              IG.                                                                              investigations.
                             Office of Inspector General
                         FY 2004/2005 Performance Measures
                                    Investigations

AGENCY           OIG                                 PERFORMANCE                                              OUTCOME/
 GOAL           GOAL                                   MEASURE                                                 IMPACT



         (continued)               Summaries of investigations and the resulting
         3. Agency officials and   administrative or judicial actions taken are incorporated   The Chairman and Congress are better
            Congress are kept      into the Semiannual Report to Congress, along with any      informed about OIG investigations, and
            fully and currently    disagreements on the actions taken or failure of            administrative and judicial consequences.
            informed of            management to act in a timely and responsible fashion.
            problems found in                                                                  Public confidence in the integrity of FCA
            the process of and     Findings made during the investigative process              programs and internal operations are
            resulting from         concerning the problem at issue or systemic problems        heightened.
            investigative          are recognized and corrected or mediated by
            activities.            management.
                                   $       $          
                          Office of Inspector General
                     FY 2004/2005 Performance Measures
                     Review of Legislation and Regulations

AGENCY           OIG                                PERFORMANCE                                             OUTCOME/
 GOAL           GOAL                                  MEASURE                                                IMPACT


  2      1. Maintain an         Processes are established and documented for              OIG input is part of the decision making
            effective program   identifying and circulating (as appropriate) relevant     process in approving or amending legislation,
            for reviewing and   documents.                                                regulations, circulars and other policy
            commenting on                                                                 positions.
            proposed and        Constructive comments on relevant documents are
            existing            submitted by the deadlines requested by the office,       Constructive criticism and creative alternatives
            legislation and     Agency or staff circulating comments.                     offered in OIG comments improve the quality
            regulations                                                                   and usefulness of documents initiated by the
            effecting the       Document review activity is summarized for inclusion in   Agency.
            Agency and the      the Semiannual Report to Congress.
            Inspectors                                                                    FCA Board and management are informed
            General                                                                       about the status of new or pending legislation
            community.                                                                    or regulations initiated externally.
                             Office of Inspector General
                         FY 2004/2005 Performance Measures
                                       Outreach
AGENCY            OIG                                  PERFORMANCE                                               OUTCOME/
 GOAL            GOAL                                    MEASURE                                                  IMPACT


1 and 2   1. Agency personnel      Develop and maintain educational brochures or               Agency employees’ acceptance of and
             understand and        pamphlets describing OIG roles and activities.              cooperation with OIG activities is improved
             accept OIG’s role                                                                 through better understanding. OIG programs
             within FCA and        Facilitate feedback from Agency employees and refine        and products are improved through feedback
             the community at      products and practices based on the feedback to OIG         from Agency employees.
             large.                products and educational materials

          2. OIG staff             Time and resources are provided to OIG staff members        Projects and activities of adjunct organizations
             provides              as an incentive to contribute to outside organizations by   such as the AGA, IIA, PCIE/ECIE, CCIG,
             leadership to         serving on committees and holding offices.                  FLETC, and IGATI are improved by OIG staff
             organizations                                                                     contributions and participation.
             directly
             contributing to the                                                               The Inspectors General community is more
             Inspectors                                                                        credible and effective.
             General
             community.

          3. OIG staff             OIG staff will participate in projects that contribute to   Management practices at the Agency are
             contributes to        achieving the vision of a better Agency and government.     improved by OIG staff participation in FCA
             special projects                                                                  special projects.
             for improving the
             Agency, the OIG                                                                   FCA programs and operations are more
             community and                                                                     effective and efficient.
             the government.
                       Office of Inspector General
                                Audit Plan
                              FY 2004/2005
BACKGROUND
      This audit plan is based on input from FCA management and staff as well as other
      issues identified by OIG staff. In particular, the CEO and the Farm Credit Administration
      (FCA) Board have expressed an interest in independent assessments of significant
      programs of the Agency. The OIG has identified its focus issues in its Semiannual
      Report to Congress in the form of management challenges. OIG audits and inspections
      are planned to provide assurances to the CEO and FCA Board that programs are
      operating effectively with appropriate controls. The Annual Audit Plan is intended to be
      a living document that is updated periodically throughout the year. It notes activities
      completed along with activities tentatively planned. Actual activities will most likely be
      selected from the areas listed below. However, actual coverage may change in order to
      be responsive to changing needs or circumstances.

MANAGEMENT CHALLENGES
      The OIG identified major challenges confronting the FCA as it works to fulfill its mission.
      These management challenges were incorporated in the OIG semiannual report and
      have been updated to reflect changes and progress in meeting the challenges. The
      challenges fall into two general categories. First are the challenges related to the FCA’s
      core mission of ensuring a dependable supply of credit to agriculture through the
      institutions it has chartered. These challenges are often shaped and influenced by
      events that are outside the control of the Agency. Second, but no less important, are
      those challenges related to the Agency’s operations.

Organizational Leadership

      The Farm Credit Act provides for a full time three-member Board. The Board members
      are appointed by the President and confirmed by the Senate. The rapidly changing
      complex financial and banking environment makes the Board’s task both challenging
      and important. The Board must be able to engage in healthy professional policy debate
      and set a sound course for the Agency. A full strength Board is an important element in
      setting clear priorities and deliberating fully on the issues. In the 17 years since the
      inception of the FCA Board, it has been at full strength for less than half of that time. On
      November 14, 2002, the newest Board member joined FCA, providing of full Board
      compliment.

      A relatively small full-time Board also presents a challenge in terms of defining the roles
      and responsibilities of the Board members relative to the governance of the Agency. As
      the membership on the Board changes, it needs to update its rules of operation to
      ensure it fulfills its statutory role in the governance of FCA. The Board will also need to
      review and revise the strategic plan for FCA.
Farm Credit System Risk

      The Farm Credit System (FCS) is a single industry lender and therefore is vulnerable to
      economic swings in the industry. FCA is challenged to balance the often-competing
      demands of ensuring the FCS fulfills it public purpose, proactively examining risk in the
      regulated institutions both individually and systemically, and controlling the cost of the
      regulator.

Financial Management

      FCA’s financial management system has undergone almost continuous change over the
      past five years. During this reporting period, the Agency completed its first financial
      statement using the services of the Department of Interior’s National Business Center.
      With a successful implementation, management’s challenge will be to leverage the
      system to deliver timely financial information that is critical to well informed management
      decisions.

Security

      In the aftermath of the events of September 11, 2001, security remains a major
      challenge for the Agency. In the August 2001 report on information security, the OIG
      found a strong foundation for security practices. However, the speed of change in the
      security environment will be a challenge for all government organizations. This is
      especially true for smaller organizations like FCA where an increased emphasis on
      physical and information security will compete with program areas for tight budget
      funding.

Human Capital

      FCA needs to develop a comprehensive, integrated approach to human capital issues.
      The FCA has not adopted a human capital strategy. In light of the changes in the
      competitive environment, advances in technology, and the tenure of its workforce, FCA
      needs to closely evaluate business processes, their associated costs, and alternatives.

Leveraging Technology

      The Agency has recognized that in order to meet the constraints of its budget, it must be
      able to maximize its return on investment in technology. FCA will need effective
      mechanisms to ensure that current and future staff has the technical skills to use
      technology to operate in an efficient manner.

AUDIT AND INSPECTION ACTIVITIES

Audit of Financial Statements

      The OIG contracts with an independent accounting firm to conduct an audit of FCA
      financial statements. During FY 2003 the OIG will deliver the audit opinion on the
      financial statements as of September 30, 2002. In future years, there is an expectation
      by management and the OMB that audit opinions will be issued closer to the end of the
      fiscal year. OIG will incorporate more interim audit work in its contract to ensure
      expectations are met.
        During FY 2003, the OIG will compete the contract for an external auditor for the audit
        opinion on the financial statements as of September 30, 2003. Traditionally, audit costs
        and time associated with managing the contract is higher during the first year of an
        engagement.

Young, Beginning and Small Farmers

        The objective of this activity is to evaluate the work performed by the Office of
        Examination to examine compliance with YBS. This activity will follow up management’s
        actions to address GAO concerns from a recent report issued by the GAO.

FISMA

        The, Financial Information Security Management Act of 2002, mandates an annual
        evaluation by the OIG or an independent external auditor. Security remains a significant
        management challenge and the OIG anticipates computer security will remain a high
        priority. The OIG will continue to work with the Chief Information Officer (CIO) to
        incorporate issues of concern in audit activities.

Compensation

        This audit will determine whether the objectives of the FCA compensation program are
        being met. We expect to conduct the audit in three distinct phases. This approach will
        ensure that management gets the benefits of audit results more timely as work on the
        overall objective is completed.

GPRA

        This activity will evaluate the agency’s compliance with the Government Performance
        and Review Act. We will focus on the FCA Board’s development of a strategic plan and
        an evaluation of the performance measures that the FCA uses to measure its impact
        and progress.

Inspections and Management Letters

        The OIG will conduct a variety of activities on areas and issues that merit review
        because of potential risk or operational weaknesses. These activities may be reported
        as management advisories or inspection reports. While planning these activities, we
        may determine the issues are broader and may expand the scope to audit the issues.
        Activities that OIG is currently considering or working on include:

               •   Agency Governance
               •   FCA Policy and Regulatory Development process
               •   Management Decision Model
               •   Implementation of risk based examinations
               •   OSMO effectiveness (will depend on scope of GAO audit)
               •   Comparison of SESD and OPA – Cost and Products
•   OGC Legal Opinion process, efficiency, and effectiveness
•   FCA Commission Program
•   Borrower Complaint Handling
•   FOIA Program
•   Office Quality Control Programs
•   Evaluation of physical security practices
•   PPM Process
•   Improper Payments
•   Administrative operations of offices in McLean
•   Competitive sourcing
                       Office of Inspector General
                           5–Year Staffing Plan
                              FY 2004-2008

I.    Statutory Role and Responsibilities

      The OIG was created within the Farm Credit Administration (FCA or Agency) by the
      1988 Amendments to the Inspector General Act of 1978 (Act) as an independent unit to:
      1) conduct and supervise audits and investigations; 2) promote economy, efficiency and
      effectiveness and to prevent fraud and abuse in program administration; and 3) keep the
      Chairman and the Congress fully informed about problems and deficiencies and the
      need and progress in correcting them.

      The Act specifies the Inspector General’s duties, responsibilities and authorities. The
      Act precludes the OIG from performing any Agency program operating function; rather,
      OIG advises management and the Congress about ways to improve programs. The
      Inspector General works with the Chairman to promote positive change within the
      Agency’s programs and operations.


II.   OIG Functions and the Staffing Needed to Deliver Related Products and
      Services

      This section describes the staffing of the OIG. It also discusses how the OIG is
      organized to produce the products and services appropriate to fulfill its responsibilities.

      The Inspector General provides leadership, policy direction, and general management
      and supervision to OIG staff. He is also an adviser to the Chairman and the principal
      spokesperson for OIG, coordinating its activities and issues with other agencies. The
      Inspector General position is comparable in grade with the other office directors.

      The Counsel to the Inspector General provides independent legal advice, analysis of
      proposed legislation and regulations, and reviews OIG products for legal sufficiency.
      Counsel represents and defends OIG in all legal issues. The Counsel also participates
      in audits and inspections on an as needed basis. This position is a permanent part-time
      position with .8 FTE.

      A Program Auditor position is devoted exclusively to audits, inspections and
      management analyses, focusing on the significant management challenges of the
      Agency.

      A Criminal Investigator provides the expertise to conduct investigations. This task is
      less than fulltime and the person in this position also performs audits, inspections and
      other analyses.

      A Management Analyst is responsible for budgeting, personnel, procurement,
      coordinating training, and for general support to the rest of the staff (time and
           attendance, preparation of all final documents, maintaining files, telephone coverage,
           etc.). The position also participates in audits, inspections and management reviews of
           administrative and operational activities.

           A College Intern is used to augment the audit and inspection staff. This position helps
           the OIG ensure that new resources are available in the event of a future vacancy.
           Recently, the OIG has used the INROADS program to further diversify staffing.

           Audits and inspections are the primary vehicles through which OIG develops
           recommendations to promote economy, efficiency and effectiveness in Agency
           programs and prevent waste and mismanagement. OIG also provides input to the
           Chairman or managers through management letters and confidential advisories. In total,
           approximately three FTEs are devoted to this function.

           An Auditor is devoted full time to audits. Also, the Counsel to the Inspector General, the
           Criminal Investigator, and the Management Analyst are cross-training to perform
           evaluations under the supervision of the Inspector General, focusing on evaluating
           administrative and operational issues. The varied backgrounds of these individuals
           bring expertise to evaluating Agency activities beyond that of traditional audits.

           OIG augments its core staff with contracts when high level subject matter expertise is
           needed to perform a particular task.

           Investigations encompass all OIG activities designed to detect or prevent fraud and
           abuse in administering Agency programs. Investigations are normally distinguished from
           other evaluations mainly in that they are directed at individuals rather than programs and
           activities. However, some of OIG’s investigative actions are directed at preventing fraud
           and abuse through improving the effectiveness of management and administrative
           controls and practices, especially in high-risk areas where we know there are
           weaknesses. OIG also manages a HOTLINE to help FCA employees and the public
           report wrongdoing.

           Other OIG Functions include internal policy direction and leadership, review of
           proposed legislation and regulations, coordination with other agencies, and advice to the
           Chairman and management about Agency programs and operations. The Inspector
           General is also responsible for fully informing the Chairman and the Congress about
           fraud and other serious problems in Agency programs, including management’s
           progress in carrying out corrective actions.


III.       OIG’s Mission, Vision and Implications for Staffing

           It is OIG’s goal to be an agent of positive change, striving for continuous improvement in
           Agency management and program operations, including our own office. Our mission is
           to be a leader and catalyst to improve FCA by identifying challenges and opportunities of
           the Agency. We strive to:

       •   Deliver products and services that are competent, objective, timely and relevant;
       •   Maintain a customer focus which is responsive to the needs of decision makers; and
      •   Provide a positive working environment that encourages us to be innovative and reach
          our potential through teamwork and open, candid communication.

          If we are to fulfill these statements, each staff member must broaden and refine their
          skills and abilities, adopt a creative approach to problem solving, and take the initiative
          to influence management. That way, management will be receptive to our conclusions
          and recommendations. Staff must be supported through management’s actions;
          equipment and training appropriate to support their activities; and mutual support from
          teammates.


IV.       Staffing Assessment and Strategies

          OIG’s diverse responsibilities prescribed by the Act dictate the presence of certain
          competencies within OIG’s staff, and the independent nature of its role also has
          implications for staffing. Even with a very small staff, the OIG can deliver its products
          and services by maintaining a high level of cross training and a broad base of expertise
          in audit, investigation, legal, management, and administration. The 5.27 FTE in this plan
          constitutes the critical mass to credibly perform OIG’s responsibilities. Conversely, the
          relative level of risk at FCA does not warrant either an increase in the number of FTE or
          change in the mix of competencies.

          Staff performs OIG evaluations and investigations under the general supervision by the
          Inspector General. These assignments are often unlike previous assignments and need
          original, creative thinking in planning and developing the project; and mature judgment in
          developing conclusions and recommendations and defending them before management.
          Counsel, the Investigator and Management Analyst must develop and maintain
          evaluative skills and abilities as well as their basic skill sets. Grades must reflect the
          depth and breadth of their work in OIG.

          The OIG established the staff pattern after careful analysis of the specialized nature of
          the OIG’s responsibilities and volume of work. Over the past 5 years, OIG reduced staff
          by 30 percent (2 auditor positions).

          The current OIG staff profile includes 80 percent women and 20 percent African
          American. OIG has been successful in obtaining a diverse pool of applicants in its
          recent job postings. When filling future OIG vacancies, we will make a concerted effort
          to encourage a diverse pool of qualified candidates. We share the Agency’s affirmative
          employment objectives and believe that a diverse staff is a critical factor in the long-term
          success of an organization. In addition to the permanent staff, the OIG budgets for one
          summer intern to work on specific audit assignments.


V.        Staffing Objectives, Strategies and Assumptions

          Objectives
          • Retain and refine the skills and competencies represented by the current staff profile.
          • Increase the diversity of OIG staff.
          • Cross-train all OIG staff to ensure each staff member can capably perform at least
             one OIG function as well as their primary staffing role.
•   Maintain and improve collaboration between OIG staff members.
•   Expand OIG staff participation in non-program activities of the Agency.

Strategies
• Agency affirmative employment objectives will be a consideration in filling any OIG
   vacancies to achieve appropriate diversity.
• Staff will identify and participate in training and professional development activities
   identified in individual development plans to retain and enhance skills.
• Teamwork training will occur regularly to promote collaboration between OIG staff
   members.
• Use intern programs to identify possible future permanent staff.

Assumptions
     Please refer to page 2
                 Office of Inspector General
                      Time by Products
                      (allocating Indirect Time)




           10%
      5%
                                                         Audits
18%
                                                         Investigations
                                                         Leg/Reg Review
                                                         Outreach
                                                   67%
                              Office of Inspector General
                                  IRM Plan Summary
                                     FY 2004-2009

      IRM Budget Category      Object FY 2004   FY 2005   FY 2006   FY 2007   FY 2008   FY 2009     Total
                                Class   Costs     Costs     Costs     Costs     Costs     Costs    Costs

Telephone & Comm. Services      2329      600       600       600       600       600       600     3,600
        Consulting Services     2510   30,000    35,000    35,000    40,000    40,000    40,000   220,000
              IT Equipment      3140   10,900     7,800         0    11,300     7,400       800    38,200
                  Software      3143      500       500       500       500       500       500     3,000
                                       42,000    43,900    36,100    52,400    48,500    41,900   264,800

                                                                Total IRM Budget FY 2004-2009     264,800
                            Office of Inspector General
                            Office Performance Budget
                                 FY 2004 Revised

                       PERFORMANCE OBJECTIVES
                                       Total  Direct                    Indirect   Total
PROGRAM ACTIVITIES
                                        Cost  Cost                        Cost     FTE
         Products and Services
1.0 Policy and Regulation                                      0    0                0.00

1.1 Regulations and Policy Development                         0    0                0.00
1.2 Statutory and Regulatory Approvals                         0    0                0.00

2.0 Safety and Soundness                                       0    0                0.00

2.1 Examination                                                0    0                0.00
2.2 Economic, Financial and Risk Analysis                      0    0                0.00
2.3 FCS Data Management                                        0    0                0.00

3.0 Reimbursable Activities                                    0    0                0.00

3.1   SBA                                                      0    0                0.00
3.2   USDA                                                     0    0                0.00
3.3   FCSIC                                                    0    0                0.00
3.4   NCB/NCB Development Corporation                          0    0                0.00

4.0 Distributed Costs                                     933,129             0      5.27

4.1 Budget and Financial Management                            0              0      0.00
4.2 Human Resources Management                                 0              0      0.00
4.3 Information Resources Management                           0              0      0.00
4.5 Communication                                              0              0      0.00
4.6 Contracting, Procurement, Mail and Supply                  0              0      0.00
4.7 Board Activities and Board Support                         0              0      0.00
4.8 Congressional and Intergovernmental Affairs                0              0      0.00
4.9 Records Management and Information Services                0              0      0.00
4.10 Audits and Investigations                                 0              0      0.00
4.11 Administration                                            0              0      0.00
4.12 OSMO/Farmer Mac (non-exam activities)                     0              0      0.00

                                                  TOTAL   933,129   0         0      5.27
                 Office of Inspector General
        Products and Services by Object Classification
                      FY 2004 Revised
                                                                  PS 2.10
                 RESOURCES                           TOTAL        Audits &      PS #    PS #    PS #    PS #
                                                               Investigations
Full Time Equivalents (FTE)                             5.27             5.27    0.00    0.00    0.00    0.00
Percentage of costs distributed on the basis of         1.00             1.00    0.00    0.00    0.00    0.00
FTE
                         Total Resource Budget       891,129          891,129      0       0       0       0

            OBJECT CLASSIFICATION
11.1 Full-time Permanent                             418,923          418,923      0       0       0       0
11.3 Other than full-time permanent                  156,382          156,382      0       0       0       0
11.5 Other personnel compensation                      2,000            2,000      0       0       0       0
                                          Total 11   577,305          577,305      0       0       0       0

12.1 Personnel benefits                              170,674          170,674      0       0       0       0

13.0 Benefits for former personnel                        0                 0      0       0       0       0

21.0 Travel and transportation of persons             15,000           15,000      0       0       0       0
22.0 Transportation of things                          1,000            1,000      0       0       0       0

23.2 Rental payments to others                            0                 0      0       0       0       0
23.3 Communications, utilities, and                     750               750      0       0       0       0
     miscellaneous charges
                                          Total 23      750               750      0       0       0       0

24.0 Printing and reproduction                         1,000            1,000      0       0       0       0

25.1 Advisory and assistance services                 30,000           30,000      0       0       0       0
25.2 Other services                                  119,000           119,00      0       0       0       0
25.3 Other purchases from Government                   3,000            3,000      0       0       0       0
     accounts
25.7 Operation and maintenance of equipment                0                0      0       0       0       0
                                       Total 25      152,000          152,000      0       0       0       0

26.0 Supplies and materials                            3,500            3,500      0       0       0       0

31.0 Equipment                                        11,900           11,900      0       0       0       0

42.0 Insurance claims and indemnities                     0                 0      0       0       0       0

92.0 Undistributed                                        0                 0      0       0       0       0

                                        Total Cost   933,129          933,129
                               Office of Inspector General
                                 Products and Services
                                    FY 2004 Revised
The accomplishment of the Office of Inspector General’s products and services correlate to
fulfilling our goals and objectives.

                  Product/Service1             Budget         % Budget         FTE       % FTE
                  Audits, Inspections,
                                                 $625,196          67%           3.53      67%
                  and Review Products
                  Investigations                 $167,963          18%            .95      18%
                  Regulation Review
                                                 $ 46,656          5%             .26       5%
                  and Comment
                  Outreach                       $ 93,313          10%            .53      10%
                  Centrally Budgeted
                                                          0          0               0          0
                  Items
                  Total                          $933,129         100%           5.27      100%

Audits, Inspections, and Review Products. Approximately 6-10 evaluative reports per year
(including annual financial audit). This includes technical advice and assistance to Agency
officials in developing management information and financial reporting systems and in
streamlining programs and organizations. It also includes survey production. At present, two
surveys are produced in OIG for the direct benefit of the Agency for use in measuring
performance. These two surveys are the Farm Credit System Survey and the Regulation
Development Survey. In addition, each audit and inspection contains a customer survey (This
is directly linked to FCA Strategic Plan.)

           Budget for FY 2004 - $625,196                                                            3.53 FTE


Investigative Function. Review of allegations. Testing information provided to determine
whether an investigation should be opened and conducting investigations when appropriate.
Maintaining OIG HOTLINE. Directing FCS Borrower issues to Agency components.

           Budget for FY 2004 – $167,963                                                             .95 FTE


Review and Comment on Proposed and Existing Regulations and Legislation.
Responding to Congressional and Executive requests and inquiries.             Reviewing and
commenting on proposed and existing legislation and regulations affecting the Agency and the
Inspectors General community.

           Budget for FY 2004 - $ 46,656                                                             .26 FTE



1
    Management, administrative support and leave are disbursed across the four program areas.
Outreach Program. Educating employees about OIG’s role within the Agency. Lend
leadership to organizations directly contributing to the IG community. Making contributions to
special projects and work groups for improving the Agency, the OIG community and the
government. This includes but is not limited to: Semiannual reports to the Agency Chairman
and Congress, participation in external activities such as membership on the Executive’s
Council on Integrity and Efficiency, and Council of Counsels to Inspectors General. We also
participate in Agency efforts, such as GPRA Initiative, Employee Council, Administrative Burden
Workgroup, Blacks in Government, Continuity of Operations Plan, FCA Compensation Study,
and the Federal Women’s Program.

       Budget for FY 2004 - $ 93,313                                                .53 FTE
                         Office of Inspector General
                         Budget and Justifications
                              Fiscal Year 2004

TOTAL OFFICE BUDGET                                                                      $933,129
Total approved IRM Plan amount included in Office Budget                                 $ 42,000

1100 Personnel Compensation                                                               $577,305

Justification
Amount required to fund salaries of OIG staff (5.27 FTE) charged with conducting audits and
investigations relating to Agency programs and operations. We are also responsible for
reviewing existing and proposed legislation and regulations to evaluate their impact on economy
and efficiency in the Agency and on the prevention of fraud and abuse. Funds are also allocated
for cash awards for deserving employees.

1200 Personnel Benefits                                                                   $170,674

Justification
Benefits are the direct result of salaries, consistent with employees’ retirement systems, health
and other elected benefits.

1300 Benefits for Former Personnel                                                        $   --

N/A

2100 Travel and Transportation of Persons                                                 $ 15,000

Justification
OIG staff will use travel funds for audit and investigative related matters. Funds will also be
used for travel related to training courses, professional association meetings, and a
teambuilding session for all OIG staff.

2200 Transportation of Things                                                              $ 1,000

Justification
This amount is necessary for anticipated express mail services throughout the year.

2300 Rent, Communications, Utilities and Misc.                                            $       750
2300 Approved IRM Plan                                                                    $       600

Justification
These funds will cover anticipated usage of telephone credit cards while on official travel, long
distance phone service in McLean, courier delivery services throughout the year to hand-deliver
information and reports to Congress and other groups, and pager service for the Inspector
General. Funds will also cover Lexis/Nexis service and a separate Internet access for the
anonymous hotline account.
IRM Justification
The independent internet account is used for confidential reporting of fraud, waste, abuse and
mismanagement. The pager service is used by the IG. Counsel to the IG uses Lexis/Nexis for
research capabilities.

2400 Printing and Reproduction                                                              $ 1,000

Justification
Cost of printing brochures, pamphlets, business cards, etc. when FCA cannot produce items.

2500 Other Contractual Services                                                            $152,000
2500 Approved IRM Plan                                                                     $ 30,000

Justification
Contract services will be needed to assist in staff reviews of programs, including FISMA and
financial statements audit. The tuition funds will be used for individual training classes for staff.
Individual training classes are a mandatory requirement of the Federal Yellow Book for auditors
and of the legal bar association for the Counsel to the IG. Membership fees will cover the dues
for professional organizations to which OIG staff belong such as the Institute of Internal Auditors
and Association of Government Accountants.

Government contractual funds will be used for miscellaneous training courses being attended by
staff at USDA, FLETC, and other government agencies. They will also be used for contracts
issued by other government agencies (Department of Labor and General Services
Administration) for independent reviews of such things as the Agency’s financial statements and
the OMB required IT security audit.


IRM Justification
GISRA requires agencies to perform an audit of IT security on an annual basis.

2600 Supplies and Materials                                                                 $ 3,500

Justification
To purchase miscellaneous text and reference books as well as on-going subscriptions. Office
supply funds will be used mainly to purchase supplies for the velobinder, which is used by the
entire Agency. Non-cash awards will be given to staff at the discretion of the IG.


3100 Equipment                                                                             $ 11,900
3100 Approved IRM Plan                                                                     $ 11,400

Justification
Purchase software as necessary in support of IG programs.

IRM Justification
Replacement of five laptops.
                            Office of Inspector General
                            Office Performance Budget
                                 FY 2005 Proposed

                       PERFORMANCE OBJECTIVES
                                       Total  Direct                    Indirect   Total
PROGRAM ACTIVITIES
                                        Cost  Cost                        Cost     FTE
         Products and Services
1.0 Policy and Regulation                                      0    0                0.00

1.1 Regulations and Policy Development                         0    0                0.00
1.2 Statutory and Regulatory Approvals                         0    0                0.00

2.0 Safety and Soundness                                       0    0                0.00

2.1 Examination                                                0    0                0.00
2.2 Economic, Financial and Risk Analysis                      0    0                0.00
2.3 FCS Data Management                                        0    0                0.00

3.0 Reimbursable Activities                                    0    0                0.00

3.1   SBA                                                      0    0                0.00
3.2   USDA                                                     0    0                0.00
3.3   FCSIC                                                    0    0                0.00
3.4   NCB/NCB Development Corporation                          0    0                0.00

4.0 Distributed Costs                                     941,467             0      5.27

4.1 Budget and Financial Management                            0              0      0.00
4.2 Human Resources Management                                 0              0      0.00
4.3 Information Resources Management                           0              0      0.00
4.5 Communication                                              0              0      0.00
4.6 Contracting, Procurement, Mail and Supply                  0              0      0.00
4.7 Board Activities and Board Support                         0              0      0.00
4.8 Congressional and Intergovernmental Affairs                0              0      0.00
4.9 Records Management and Information Services                0              0      0.00
4.10 Audits and Investigations                                 0              0      0.00
4.11 Administration                                            0              0      0.00
4.12 OSMO/Farmer Mac (non-exam activities)                     0              0      0.00

                                                  TOTAL   941,467   0         0      5.27
                 Office of Inspector General
        Products and Services by Object Classification
                      FY 2005 Proposed
                                                                  PS 2.10
                 RESOURCES                           TOTAL        Audits &      PS #    PS #    PS #    PS #
                                                               Investigations
Full Time Equivalents (FTE)                             5.27             5.27    0.00    0.00    0.00    0.00
Percentage of costs distributed on the basis of         1.00             1.00    0.00    0.00    0.00    0.00
FTE
                         Total Resource Budget       897,567          897,567      0       0       0       0

            OBJECT CLASSIFICATION
11.1 Full-time Permanent                             418,923          418,923      0       0       0       0
11.3 Other than full-time permanent                  157,311          157,311      0       0       0       0
11.5 Other personnel compensation                      2,000            2,000      0       0       0       0
                                          Total 11   578,234          578,234      0       0       0       0

12.1 Personnel benefits                              176,183          176,183      0       0       0       0

13.0 Benefits for former personnel                        0                 0      0       0       0       0

21.0 Travel and transportation of persons             15,000           15,000      0       0       0       0
22.0 Transportation of things                          1,000            1,000      0       0       0       0

23.2 Rental payments to others                            0                 0      0       0       0       0
23.3 Communications, utilities, and                     750               750      0       0       0       0
     miscellaneous charges
                                          Total 23      750               750      0       0       0       0

24.0 Printing and reproduction                         1,000            1,000      0       0       0       0

25.1 Advisory and assistance services                 35,000           35,000      0       0       0       0
25.2 Other services                                  119,000           119,00      0       0       0       0
25.3 Other purchases from Government                   3,000            3,000      0       0       0       0
     accounts
25.7 Operation and maintenance of equipment                0                0      0       0       0       0
                                       Total 25      157,000          157,000      0       0       0       0

26.0 Supplies and materials                            3,500            3,500      0       0       0       0

31.0 Equipment                                         8,800            8,800      0       0       0       0

42.0 Insurance claims and indemnities                     0                 0      0       0       0       0

92.0 Undistributed                                        0                 0      0       0       0       0

                                        Total Cost   941,467          941,467
                            Office of Inspector General
                              Products and Services
                                 FY 2005 Proposed
The accomplishment of the Office of Inspector General’s products and services correlate to
fulfilling our goals and objectives.

                Product/Service2             Budget         % Budget        FTE       % FTE
                Audits, Inspections,
                                              $630,783          67%           3.53       67%
                and Review Products
                Investigations                $169,464          18%             .95      18%
                Regulation Review
                                               $ 47,073          5%             .26      5%
                and Comment
                Outreach                       $ 94,147         10%             .53      10%
                Centrally Budgeted
                                                       0          0               0        0
                Items
                Total                         $941,467         100%           5.27      100%

Audits, Inspections, and Review Products. Approximately 6-10 evaluative reports per
year (including annual financial audit). This includes technical advice and assistance to
Agency officials in developing management information and financial reporting systems and
in streamlining programs and organizations.        It also includes survey production. At
present, two surveys are produced in OIG for the direct benefit of the Agency for use in
measuring performance. These two surveys are the Farm Credit System Survey and the
Regulation Development Survey. In addition, each audit and inspection contains a
customer survey (This is directly linked to FCA Strategic Plan.)

           Budget for FY 2004 - $630,783                                                        3.53 FTE


Investigative Function. Review of allegations. Testing information provided to determine
whether an investigation should be opened and conducting investigations when
appropriate. Maintaining OIG HOTLINE. Directing FCS Borrower issues to Agency
components.

           Budget for FY 2004 – $169,464                                                         .95 FTE


Review and Comment on Proposed and Existing Regulations and Legislation.
Responding to Congressional and Executive requests and inquiries. Reviewing and
commenting on proposed and existing legislation and regulations affecting the Agency and
the Inspectors General community.

           Budget for FY 2004 - $ 47,073                                                         .26 FTE


2
    Management, administrative support and leave are disbursed across the four program areas.
Outreach Program. Educating employees about OIG’s role within the Agency. Lend
leadership to organizations directly contributing to the IG community. Making contributions
to special projects and work groups for improving the Agency, the OIG community and the
government. This includes but is not limited to: Semiannual reports to the Agency
Chairman and Congress, participation in external activities such as membership on the
Executive’s Council on Integrity and Efficiency, and Council of Counsels to Inspectors
General. We also participate in Agency efforts, such as GPRA Initiative, Employee
Council, Administrative Burden Workgroup, Blacks in Government, Continuity of Operations
Plan, FCA Compensation Study, and the Federal Women’s Program.

       Budget for FY 2004 - $ 94,147                                                 .53 FTE
                      Office of Inspector General
                      Budget and Justifications
                           Fiscal Year 2005

TOTAL OFFICE BUDGET
$941,467
Total approved IRM Plan amount included in Office Budget                                 $
43,900

1100 Personnel Compensation
$578,234

Justification
Amount required to fund salaries of OIG staff (5.27 FTE) charged with conducting audits
and investigations relating to Agency programs and operations. We are also responsible
for reviewing existing and proposed legislation and regulations to evaluate their impact on
economy and efficiency in the Agency and on the prevention of fraud and abuse. Funds are
also allocated for cash awards for deserving employees.

1200 Personnel Benefits
$176,183

Justification
Benefits are the direct result of salaries, consistent with employees’ retirement systems,
health and other elected benefits.

1300 Benefits for Former Personnel                                                           $   -
-

N/A

2100 Travel and Transportation of Persons                                                    $
15,000

Justification
OIG staff will use travel funds for audit and investigative related matters. Funds will also be
used for travel related to training courses, professional association meetings, and a
teambuilding session for all OIG staff.

2200 Transportation of Things                                                                $
1,000

Justification
This amount is necessary for anticipated express mail services throughout the year.
2300 Rent, Communications, Utilities and Misc.                                            $
750
2300 Approved IRM Plan                                                                    $
600

Justification
These funds will cover anticipated usage of telephone credit cards while on official travel,
long distance phone service in McLean, courier delivery services throughout the year to
hand-deliver information and reports to Congress and other groups, and pager service for
the Inspector General. Funds will also cover Lexis/Nexis service and a separate Internet
access for the anonymous hotline account.

IRM Justification
The independent internet account is used for confidential reporting of fraud, waste, abuse
and mismanagement. The pager service is used by the IG. Counsel to the IG uses
Lexis/Nexis for research capabilities.

2400 Printing and Reproduction                                                               $
1,000

Justification
Cost of printing brochures, pamphlets, business cards, etc. when FCA cannot produce
items.

2500 Other Contractual Services
$157,000
2500 Approved IRM Plan                                                                   $
35,000

Justification
Contract services will be needed to assist in staff reviews of programs, including FISMA
and financial statements audit. The tuition funds will be used for individual training classes
for staff. Individual training classes are a mandatory requirement of the Federal Yellow
Book for auditors and of the legal bar association for the Counsel to the IG. Membership
fees will cover the dues for professional organizations to which OIG staff belong such as
the Institute of Internal Auditors and Association of Government Accountants.

Government contractual funds will be used for miscellaneous training courses being
attended by staff at USDA, FLETC, and other government agencies. They will also be
used for contracts issued by other government agencies (Department of Labor and General
Services Administration) for independent reviews of such things as the Agency’s financial
statements and the OMB required IT security audit.


IRM Justification
GISRA requires agencies to perform an audit of IT security on an annual basis.

2600 Supplies and Materials                                                                  $
3,500
Justification
To purchase miscellaneous text and reference books as well as on-going subscriptions.
Office supply funds will be used mainly to purchase supplies for the velobinder, which is
used by the entire Agency. Non-cash awards will be given to staff at the discretion of the
IG.


3100 Equipment                                                                          $
8,800
3100 Approved IRM Plan                                                                  $
8,300

Justification
Purchase software as necessary in support of IG programs.

IRM Justification
Replacement of five laptops.
                           FARM CREDIT ADMINISTRATION
                              FY 2004/2005 Budget Call
                                     Unit: 700000
                             Office of Inspector General
                                   Detailed Budget

FULL-TIME EQUIVALENTS (FTE)                       5.08           5.08
                                                 FY 2004        FY 2005         DIFFERENCE
OBJECT CLASSIFICATION                            Revised       Proposed       Amount   Percent
1100      Total Personnel Compensation
   11.1   Permanent full-time
          1111          Permanent full-time        418,923       418,923            0     0.00%
          Sub-Total     11.1                       418,923       418,923            0     0.00%
  11.3    Other than Permanent Full-Time
          1139          Other than permanent       156,382       157,311            0     0.00%
                        full-time
          Sub-Total     11.3                       156,382       157,311          929     0.59%
  11.5    Other Personnel Compensation
          1151          Overtime                         0             0            0     0.00%
          1154          Cash incentive and           2,000         2,000            0     0.00%
                        other awards
          Sub-Total     11.5                         2,000         2,000            0     0.00%
TOTAL     1100                                     577,305       578,234          929     0.16%

1200      Total Personnel Benefits
   12.1   Benefits
          1214         TSP – Matching               20,206        21,006          800     3.96%
          1217         Disability insurance              0             0            0     0.00%
                       premium
          1224         Relocation payments                 0             0          0     0.00%
                       under object code
                       1200
          1299         Benefits generated          150,468       155,177         4,709    3.13%
                       from payroll
          Sub-Total    12.1                        170,674       176,183         5,509    3.23%
TOTAL     1200                                     149,616       151,550         5,509    3.23%

2100      Travel and Transportation of Persons
   21.0   Travel and Transportation of Persons
          2101          TDY and local travel        15,000        15.000            0     0.00%
          2110          Lodging rooms paid               0             0            0     0.00%
                        under one document
          2116          Taxi voucher                       0             0          0     0.00%
          2121          Lease of passenger                 0             0          0     0.00%
                        vehicles
          2122          Relocation payments-               0             0          0     0.00%
                        2100 taxable
          2123          Relocation payments-               0             0          0     0.00%
                        2100 non-taxable
          Sub-Total     21.0                        15,000        15,000            0     0.00%
TOTAL     2100                                      15,000        15,000            0     0.00%

2200      Transportation of Things
   22.0   Transportation of Things
          2212          Freight, express mail            100            100         0     0.00%
                        (UPS, DHL,FedEx)
                                                 FY 2002        FY 2004      DIFFERENCE
OBJECT CLASSIFICATION (continued)                Revised       Proposed    Amount   Percent
          2213          Other freight, express       1,000         1,000         0     0.00%
                        mail (UPS, DHL,
                        FedEx)
          2214          Transportation of                  0          0          0      0.00%
                        household goods
          Sub-Total     22.0                         1,000         1,000         0     0.00%
TOTAL     2200                                       1,000         1,000         0     0.00%

2300      Total Rent, Comm., Util., and Misc.
   23.2   Rental Payments to Others
          2321          Rent/lease-space –               0            0          0      0.00%
                        lodging
          Sub-Total     23.2                             0            0          0     0.00%
  23.3    Communications, Utilities and Miscellaneous Charges
          2329          Telephone and                  600          600          0      0.00%
                        communications
                        services
          2330          Other telephone and              0            0          0      0.00%
                        communications
                        services
          2331          Data and other IT                0            0          0      0.00%
                        communications
                        charges
          2333          Other postages –                 0            0          0      0.00%
                        USPS
          2334          Postage – USPS                   0            0          0     0.00%
          2335          Messenger and courier          150          150          0     0.00%
                        services
          2336          Other messenger and              0            0          0      0.00%
                        courier services
          2338          Equipment and                    0            0          0      0.00%
                        software rental
          Sub-Total     23.3                           750          750          0     0.00%
TOTAL     2300                                         750          750          0     0.00%

2400      Printing and Reproduction
   24.0   Printing and Reproduction
          2401          U.S. Government                    0          0          0      0.00%
                        Printing Office (GPO)
          2402          Other U.S.                         0          0          0      0.00%
                        Government Printing
                        Office (GPO)
          2403          Commercial                   1,000         1,000         0     0.00%
                        printers/photographers
          2404          Publications of                    0          0          0      0.00%
                        notices/classified
                        advertising, etc.
          2405          Other commercial                   0          0          0      0.00%
                        printers/photographers
          Sub-Total     24.0                         1,000         1,000         0     0.00%
TOTAL     2400                                       1,000         1,000         0     0.00%

2500      Other Contractual Services
   25.1   Consulting Services
          2510          Consulting Services         30,000        35,000      5,000    16.67%
          Sub-Total     25.1                        30,000        35,000      5,000    16.67%
  25.2    Other Services
          2524          Convenience check                  0          0          0      0.00%
                        fees
                                               FY 2002        FY 2004      DIFFERENCE
OBJECT CLASSIFICATION (continued)              Revised       Proposed    Amount   Percent
          2525         Training                    3,500         3,500          0     0.00%
          2526         Membership Fees               500           500          0     0.00%
          2528         Other contractual         115,000       115,000          0     0.00%
                       services
          2529         Renovating office               0            0           0     0.00%
                       space
          Sub-Total    25.2                      119,000       119,000          0     0.00%
  25.3    Purchase of Goods and Services from Government
          2535         Training – Gov’t            3,000         3,000          0     0.00%
          2538         Other contractual               0             0          0     0.00%
                       services – Gov’t
          2539         Security investigations,        0            0           0     0.00%
                       NFC payroll processing
                       and dn
          Sub-Total    25.3                        3,000         3,000          0     0.00%
  25.7    Operation and Maintenance of Equipment
          2576         Operation/maintenance           0            0           0     0.00%
                       – equipment/software
          2577         Other                           0            0           0     0.00%
                       operation/maintenance
                       – equipment/software
          Sub-Total    25.7                            0             0          0     0.00%
TOTAL     2500                                   152,000       157,000      5,000     3.29%

2600      Supplies and Equipment
   26.0   Supplies and Materials
          2609         Supplies                    2,000         2,000          0     0.00%
          2610         Central Supplies                0             0          0     0.00%
          2611         Paper Supplies                  0             0          0     0.00%
          2613         Non-cash awards and         1,000         1,000          0     0.00%
                       gifts
          2614         Other non-cash awards             0          0           0     0.00%
                       and gifts
          2639         Subscriptions and            500           500           0     0.00%
                       publications
          2650         Fuel                              0          0           0     0.00%
          2660         Reception and                     0          0           0     0.00%
                       representation
                       expenses
          Sub-Total    26.0                        3,500         3,500          0     0.00%
TOTAL     26.0                                     3,500         3,500          0     0.00%

3100      Equipment
   31.0   Equipment
          3109          Non-IT equipment,           500           500           0     0.00%
                        furniture, fixtures
          3140          IT equipment              10,900         7,800      -3,100   -28.44%
          3143          Software                     500           500           0     0.00%
          Sub-Total     31.0                      11,900         8,800      -3,100   -26.05%
TOTAL     3100                                    11,900         8,800      -3,100   -26.05%

4200      Insurance Claims and Indemnities
   42.0   Insurance Claims and Indemnities
          4200          Insurance claims and             0          0           0     0.00%
                        indemnities
          Sub-Total     42.0                             0          0           0     0.00%
TOTAL     4200                                           0          0           0     0.00%

GRAND TOTAL FOR UNIT                            $933,129      $941,467     $8,338     0.89%
                           FARM CREDIT ADMINISTRATION
                              FY 2004/2005 Budget Call
                                     Unit: 700000
                             Office of Inspector General
                                  Budget Summary
FULL-TIME EQUIVALANETS (FTE)                      5.27           5.27
                                                 FY 2004        FY 2004         DIFFERENCE
OBJECT CLASSIFICATION                            Revised       Proposed       Amount   Percent
1100      Total Personnel Compensation
   11.1   Permanent Full-Time                      418,923       418,923             0     0.00%
   11.3   Other than Permanent Full-Time           156,382       157,311           929     0.59%
   11.5   Other Personnel Compensation               2,000         2,000             0     0.00%
          TOTAL 1100                               577,305       578,234           929     0.00%

1200      Total Personnel Benefits
   12.1   Benefits                                 170,674       176,183         5,509     3.23%
          TOTAL 1200                               170,674       176,183         5,509     3.23%

2100      Travel and Transportation of Persons
   21.0   Travel and Transportation of Persons      15,000        15,000             0     0.00%
          TOTAL 2100                                15,000        15,000             0     0.00%

2200      Transportation of Things
   22.0   Transportation of Things                   1,000         1,000             0     0.00%
          TOTAL 2200                                 1,000         1,000             0     0.00%

2300      Total Rent, Comm., Util., and Misc.
   23.2   Rental Payments to Others                        0              0          0     0.00%
   23.3   Communications, Utilities and                  750            750          0     0.00%
          Miscellaneous Charges
          TOTAL 2300                                     750            750          0     0.00%

2400      Printing and Reproduction
   24.0   Printing and Reproduction                  1,000         1,000             0     0.00%
          TOTAL 2400                                 1,000         1,000             0     0.00%

2500      Other Contractual Services
   25.1   Advisory and Assistance Service             30,,,       35,000         5,000    16.67%
   25.2   Other Services                           119,000       119,000             0     0.00%
   25.3   Purchases of Goods and Services            3,000         3,000             0     0.00%
          from Government
  25.7    Operation and Maintenance of                     0             0           0     0.00%
          Equipment
          TOTAL 2500                               152,000       157,000         5,000     0.00%

2600      Supplies and Equipment
   26.0   Supplies and Materials                     3,500         3,500             0     0.00%
          TOTAL 2600                                 3,500         3,500             0     0.00%

3100      Equipment
   31.0   Equipment                                 11,900         8,800         -3,100   -26.05%
          TOTAL 3100                                11,900         8,800         -3,100     -26.05

4200      Insurance Claims and Indemnities
   42.0   Insurance Claims and Indemnities                 0             0           0     0.00%
          TOTAL 4200                                       0             0           0     0.00%

GRAND TOTAL FOR UNIT                              $933,129      $941,467        $8,338     0.89%
                         Office of the Inspector General
                                  FY 2001- 2005
                 Performance by Projects, Products and Services
                             and Program Activities
Program Activities                                             RESOURCES
                                           Project     FY        FY       FY         FY         FY
  Products and Services                    Number     2001      2002     2003       2004       2005
     Projects                                        Actual    Actual    Rev.       Rev.       Prop.
1.0 Policy and Regulation                                  0         0          0          0           0

1.1 Regulation and Policy Development                     0         0           0          0           0
Competition/Regulation Review               3177          0         0
Regulatory Burden                           3178          0         0
Termination/Banks & Large Associations      3180          0         0
Leasing Authorities                         3181          0         0
Borrower Rights                             3182          0         0
Releasing Information                       3184          0         0
FCA Handbook                                3185          0         0
Federal Register Liaison                    3186          0         0
Other Regulatory Initiatives                3187          0         0
YBS Policy Statement                        3188          0         0
Recodify Farm Credit Act                    3196          0         0
Other Policy Initiatives                    3200          0         0
Investments in Rural USA                    3292          0         0
OFI Lending                                 3293          0         0
National Charters                           3308          0         0
Texas FCB Litigation                        3313          0         0
Capital and Financial Risk Management       3315          0         0
Electronic Commerce (FCS)                   3318          0         0
Distressed Loan Restructuring               3323          0         0
Effective Interest Rate                     3324          0         0
Credit and Related Services                 3325          0         0
FCS Institution Structure                   3326          0         0
Enforcement Activities                      3327          0         0
FCS/GSE Mission                             3328          0         0
Flood Insurance (CMP)                       3329          0         0
Section 508 Compliance                      3338          0         0
Capital/Technical Amendments                3345          0         0
Capital Leverage Ratio                      3346          0         0
Young, Beginning and Small Farmers (YBS)    3349          0         0
Loan Syndications                           3350          0         0
Scope and Eligibility                       3351          0         0
Regulatory Burden Solicitation              3352          0         0
Governance of FCS Institutions              3353          0         0

1.2 Statutory and Regulatory Approvals                    0         0           0          0           0
Corporate Activity                          3204          0         0
Funding Approvals                           3205          0         0
Other Regulatory Approvals                  3206          0         0



2.0 Safety and Soundness                                  0         0           0          0           0

2.1 Examination                                           0         0           0          0           0
Examination                                UNINUM         0         0
Early Warning Analysis                       508          0         0
General Examination                         2206          0         0
OE QA Program/Vulnerability Assessment      2042          0         0
Training Development                        2048          0         0
Program Activities (continued)                                     RESOURCES
                                                           FY        FY       FY         FY         FY
                                               Project
  Products and Services                        Number
                                                          2001      2002     2003       2004       2005
                                                         Actual    Actual    Rev.       Rev.       Prop.
OE Workshops/Conferences                        2050           0         0
Automated IS Issues                             2335           0         0
Exam Manual Update                              2640           0         0
CMS Activities                                  2963           0         0
Legal Support for OE                            3175           0         0
E-Commerce Task Force                           3307           0         0
OE Modernization Project                        3317           0         0
Commission Test Development                     3320           0         0

2.2 Economic, Financial and Risk Analysis                     0         0           0          0           0
Underwriting Standards                          2851          0         0
Ag Land Value Trends                            3169          0         0
Public Reports and Briefing                     3170          0         0
Market Research and Monitoring                  3172          0         0
Board Support Initiatives                       3173          0         0
Other Risk Analysis                             3174          0         0
System Structure Study                          3321          0         0

2.3 FCS Data Management                                       0         0           0          0           0
FCS Data Management                             3190          0         0
YBS and OMB Reports                             3332          0         0
LARS Redesign                                   3337          0         0

3.0 Reimbursable Activities                                   0         0           0          0           0

3.1 SBA                                                       0         0           0          0           0
SBA Project Management                           3143         0         0
SBA Training                                     3319         0         0
SBLC-Commercial Capital Corporation            1900701        0         0
SBLC-Business Loan Center, Inc.                1900702        0         0
SBLC-Grow America Fund, Inc.                   1900703        0         0
SBLC-Loan Source, Inc.                         1900704        0         0
SBLC-CIT SBLC                                  1900705        0         0
SBLC-First Western SBLC                        1900706        0         0
SBLC-Amresco                                   1900707        0         0
SBLC-Associated Commercial Corporation         1900708        0         0
SBLC-Small Business Loan Source, Inc.          1900709        0         0
SBLC-Allied Capital SBLC                       1900710        0         0
SBLC-Transamerica                              1900711        0         0
SBLC-Money Store                               1900712        0         0
SBLC-Heller First Capital Corporation          1900713        0         0
SBLC-GE Capital                                1900714        0         0

3.2 USDA                                                      0         0           0          0           0
USDA Project Management                          3314         0         0
USDA Training                                    3343         0         0
USDA State Office Exams                          3344         0         0
USDA-Alternative Agricultural Research Corp.     3354         0         0
USDA-Business Loan Express                     2500001        0         0
USDA-B&I Lending                               2500002        0         0
USDA-Carolina Capital                          2500003        0         0

3.3 FCSIC                                                     0         0           0          0           0
FCSIC Default Project                           2225          0         0
FCA Support of FCSIC                            3279          0         0
ORM Support of FCSIC                            3283          0         0

3.4 NCB/NCB Development Corporation                           0         0           0          0           0
FCA Support of NCB                              3280          0         0
FCA Support of NBC Development Corp.            3281          0         0
Program Activities (continued)                                   RESOURCES
                                                        FY        FY        FY          FY         FY
                                            Project
  Products and Services                     Number
                                                       2001      2002      2003        2004       2005
                                                      Actual    Actual     Rev.        Rev.       Prop.
Legal Counsel NCB Development Corporation    3285           0         0
NCB                                         2000100         0         0

4.0 Distributed cost                                  732,998   763,617   852,046     933,129     941,467

4.1 Budget and Financial Management                      376         0            0           0           0
Financial Management Policies                3234          0         0
Budgeting and Analysis                       3235          0         0
Financial Management Systems                 3236          0         0
Financial Reports and Statements             3237          0         0
Accounting Duties                            3238        376         0
Financial Management Guidance                3322          0         0

4.2 Human Resources Management                          3,103    13,335           0           0           0
Training Taken                               3001           0      5668
Personnel and Payroll Processing             3161           0         0
Compensation and Benefits                    3162           0         0
Training Administration and Development      3163       3,103         0
Staffing and Job Evaluation                  3164           0     3,500
Employee/Management Relations                3165           0         0
Training G2                                  3222           0         0
Training Development G2                      3223           0         0
Other Administration G2                      3225           0         0
Structural Streamlining                      3334           0         0
Bonus Performance Payments                   3339           0     3,882
FCA Compensation Study                       3341           0       285
Executive Leadership Program                 3342           0         0
Human Development and Investment             3356           0         0

4.3 Information Resources Management                       0        95            0           0           0
System Development                           3229          0         0
User Support                                 3230          0         0
NT and Network Management                    3231          0         0
Client Systems Management                    3232          0         0
Database Administration                      3233          0         0
Agency Laptop Replacement                    3309          0         0
IT Accessibility Task Group                  3310          0         0
Lotus Notes R5 Upgrade                       3312          0         0
IRMOC                                        3330          0         0
IRM Planning                                 3331          0         0
IT Security                                  3340          0        95

4.4 Other Legal Counsel                                    0         0            0           0           0
General Litigation                           3197          0         0
Legal Counsel – Other                        3336          0         0

4.5 Communication                                        150         0            0           0           0
Management Reporting                         2308          0         0
Design and Duplicating                       2663          0         0
Borrower Complaints                          3156          0         0
Symposium – Ag Lending                       3167          0         0
Economic Seminars and Conferences            3171          0         0
Government Coordination                      3207          0         0
System Liaison                               3208          0         0
Media and Public Affairs                     3209          0         0
International Program                        3211          0         0
Informational Memoranda                      3212        113         0
Publication Editing                          3214          0         0
Meeting Planning                             3215          0         0
Plain Language Initiative                    3216          0         0
Internal Communication G2                    3219          0         0
Program Activities (continued)                                       RESOURCES
                                                            FY        FY        FY          FY         FY
                                                Project
  Products and Services                         Number
                                                           2001      2002      2003        2004       2005
                                                          Actual    Actual     Rev.        Rev.       Prop.
Internal Communication                           3247          37         0
FCA Web Site                                     3333           0         0

4.6 Contracting, Procurement, Mail & Supply                    0         0            0           0           0
Procurement                                      3239          0         0
Mail Administration                              3240          0         0
Supplies Administration                          3241          0         0
Transportation Administration                    3242          0         0

4.7 Board Activities and Board Support                         0       250            0           0           0
Board Support Initiatives                        2357          0         0
Board Support Initiatives                        2989          0         0
Board Support                                    3213          0       250
Board Member Activity                            3335          0         0

4.8 Congressional & Intergovernmental Affairs                  0         0            0           0           0
Congress and Government Liaison                  3201          0         0
Legislative Analysis                             3203          0         0
Ombudsman Activities                             3355          0         0

4.9 Records Management & Information Services                104       125            0           0           0
Information Center and Records Management        3226        104       125

4.10 Audits and Investigations                            555,437   629,034   852,046     933,129     941,467
OIG Time                                         1425     555,414   629,034
Audit, QA and Internal Control                   3221           0         0
Audit, QA and Internal Control                   3249          23         0

4.11 Administration                                       171,463   120,778           0           0           0
General Administration                           3002           0       293
Planning                                         3004           0       127
Clerical and Administrative Support              3005           0         0
Year 2000 Activities                             3006           0         0
Best Practices                                   3059           0         0
Year 2000                                        3063           0         0
Management and Supervision                       3160      77,470         0
Management G2                                    3217           0         0
Planning and Budgeting G2                        3218           0         0
Clerical and Administrative Support G2           3220       2,310         0
Technical Committees                             3224           0         0
FCS Building Association Liaison                 3243           0         0
Leave                                            3244      91,683   120,117
Management G3                                    3245           0         0
Planning and Budgeting G3                        3246           0         0
Clerical and Administrative Support G3           3248           0         0
Other Administration G3                          3250           0         0
Ethics Program                                   3251           0       241
FOIA and Release of Information                  3252           0         0
EEO                                              3254           0         0
Agency Compliance                                3287           0         0
FCA Mentoring Program                            3288           0         0

4.12 OSMO/Farmer Mac (non-exam activities)                  2,365        0            0           0           0
Legal Counsel – OSMO                             3276           0        0
Risk-Based Capital Rule                          3277       2,365        0
OSMO Activities                                  3290           0        0
Farmer Mac Call Reports                          3347           0        0
Farmer Mac Issues                                3348           0        0
TOTAL                                                     732,998   763,617   852,046     933,129     941,467
            Office of Inspector General
                       FY 2004
  Impact Analysis on Products and Services from a
          Changing Budget Environment


                Alternative Budget Plus and Minus 10 percent

An increase in the OIG budget of 10 percent would allow the OIG to expand the audit plan
to incorporate more contract audit work.

A decrease in the OIG budget of 10 percent would eliminate the hiring of an intern and also
create a potential reduction in force scenario. The decrease would adversely impact the
ability to meet reporting requirements of the IG Act and the delivery of products and
services.