oversight

FY 2005-2006

Published by the Farm Credit Administration, Office of Inspector General on 2004-06-30.

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

Office of
Inspector General



               OPERATING AND PERFORMANCE PLAN

                  FISCAL YEARS 2005 AND 2006




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




June 30, 2004



The Honorable Nancy C. Pellett
Chairman and Chief Executive Officer
Farm Credit Administration
1501 Farm Credit Drive
McLean, Virginia 22102-5090

Dear Ms. Pellett:

The enclosed document is the Office of Inspector General’s (OIG’s) Operating and Performance
Plan for Fiscal Years 2005 and 2006. 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

cc:    Cheryl Macias
       Chief Operating Officer
                                                TABLE OF CONTENTS


Mission Statement & Objectives and Goals ........................................................................ Tab 1
Assumptions ....................................................................................................................... Tab 1

Performance Measures....................................................................................................... Tab 2
Audit Plan............................................................................................................................ Tab 2

Staffing and Resource Needs and Distribution ................................................................... Tab 3
Staffing Distribution Chart ................................................................................................... Tab 3

IRM Plan Summary Report ................................................................................................. Tab 4

FY 2005 Revised Performance Budget .............................................................................. Tab 5
FY 2005 Revised Products and Services by Object Classification ..................................... Tab 5
FY 2005 Revised Products and Services ........................................................................... Tab 5
FY 2005 Budget and Justifications ..................................................................................... Tab 5

FY 2006 Proposed Performance Budget ............................................................................ Tab 5
FY 2006 Proposed Products and Services by Object Classification................................... Tab 5
FY 2006 Proposed Products and Services ......................................................................... Tab 5
FY 2006 Proposed Budget and Justifications ..................................................................... Tab 5

Budget Detail for FY 2005-2006 ......................................................................................... Tab 5
Budget Summary for FY 2005-2006 ................................................................................... Tab 5
FY 2002-2006 Performance by Projects, Products and Services and Program Activities .. Tab 5
Budget History .................................................................................................................... Tab 5
Impact Analysis on Products and Services from a Changing Budget Environment............ Tab 5
                    Farm Credit Administration
                    Office of Inspector General
                       Fiscal Year 2005-2006

                                          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
             management, the Board, and the 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 OIG.
          3. Provide relevant information on results of investigative activities to appropriate
             parties.

   •   Review and make recommendations regarding existing and proposed legislation
       and regulations relating to agency programs and operations and the Inspector
       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 the OIG; and work with the Inspector
       General (IG) community and other related organizations to address government-
       wide issues.
          1. Building relationships with program managers based on a shared commitment to
             improving program operations and effectiveness.
          2. Provide leadership to the IG community.
          3. Contribute to special projects to improve the agency.
                  Farm Credit Administration
                  Office of Inspector General
                     Fiscal Year 2005-2006

                                   ASSUMPTIONS
•   There will be no structural change in the OIG staffing plan.

•   The agency will remain competitive in its compensation program.

•   The OIG’s contracting budget will be adequate to obtain additional subject matter
    expertise whenever specific evaluations require it.

•   The OIG’s training budget will be adequate to maintain leadership, technical, cultural,
    and collaborative competencies.
                                                Farm Credit Administration
                                                Office of Inspector General
                                                   Fiscal Year 2005-2006

                     AUDITS AND EVALUATIONS OF AGENCY PROGRAMS AND OPERATIONS
                                                    AGENCY GOALS 1, 2 AND 3

               OIG GOAL                                      PERFORMANCE MEASURE                                         OUTCOME/IMPACT
1.   Deliver quality audit, inspection, and   Audits and inspections are relevant. Audit coverage          FCA programs and operations are more
     review products and services that        includes all mandated audits and at least 75% of those       effective.
     are useful to the Board,                 suggested by the Board and management.
                                                                                                           Waste in agency programs and operations is
     management and/or the Congress.
                                              Risk is addressed. 100% of OIG audits are performed in       reduced.
                                              high risk/high dollar programs and activities and/or are
                                                                                                           Increased agency compliance with laws,
                                              tied to the agency strategic planning goals.
                                                                                                           regulations, and internal policies and
                                              Findings made during audit fieldwork are recognized and      procedures.
                                              corrected by management prior to drafting of the audit
                                                                                                           The agency’s stature and reputation is
                                              report.
                                                                                                           elevated in the eyes of the 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 the OIG audit
                                                                                                           The OIG is more effective in promoting
                                              recommendations.
                                                                                                           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.
2.   Provide technical advice and             The IG advises the Chairman concerning policy direction      OIG input and advice contributes to agency
     assistance to agency officials in        or administrative priorities.                                decisions and actions that are more complete
     developing sound management                                                                           and valid in the inception.
                                              OIG performs analysis and provides technical advice to
     information and financial reporting
                                              management concerning accounting, management                 Increase in management requests for advice,
     systems and in streamlining
                                              systems and controls, and performance measures.              review, and technical assistance.
     programs and organizations.
                                       Farm Credit Administration
                                       Office of Inspector General
                                          Fiscal Year 2005-2006

                  AUDITS AND EVALUATIONS OF AGENCY PROGRAMS AND OPERATIONS
                                           AGENCY GOALS 1, 2 AND 3

              OIG GOAL                              PERFORMANCE MEASURE                                       OUTCOME/IMPACT
                                                                                                Peer review reports provide an unqualified
                                                                                                opinion that OIG audit work meets or exceeds
                                                                                                quality audit standards prescribed by the
                                                                                                General Accounting Office (GAO) and the
                                                                                                President’s Council on Integrity and Efficiency
                                                                                                (PCIE) and the Executive Council on Integrity
                                                                                                and Efficiency (ECIE).
3.   Continuous improvement of OIG   Customer survey feedback is used to improve products       Customer survey feedback evidences increase
     staff, products, and internal   and services.                                              satisfaction with report practices.
     administration.
                                     OIG training ensures the technical proficiency of staff.   The IG’s opportunity to facilitate positive
                                                                                                change within the agency is enhanced by the
                                     OIG implements administrative improvements identified
                                                                                                quality and credibility of OIG products and
                                     through reviews of other agency programs and through
                                                                                                advice.
                                     staff involvement with the professional community.
                                             Farm Credit Administration
                                             Office of Inspector General
                                                Fiscal Year 2005-2006

                                                              INVESTIGATIONS
                                                   AGENCY GOALS 1 AND 2

              OIG GOAL                                    PERFORMANCE MEASURE                                        OUTCOME/IMPACT
1. Administrative and criminal             Investigative reports are timely and presented in an        Administrative action, convictions or pleas are
   violations relating to FCA programs     objective and factual manner. Memoranda are issued to       obtained for employees and/or contractors
   and personnel are effectively           management describing internal control weaknesses or        found guilty of wrongdoing.
   investigated and reported.              program deficiencies found during the investigative
                                                                                                       Management actions taken against employees
                                           process with suggestions to prevent and/or detect future
                                                                                                       serve as a deterrent to future wrongdoing.
                                           wrongdoing.
                                                                                                       FCA internal policies, procedures and controls
                                           70% of active cases will be less than two years old (from
                                                                                                       are strengthened to prevent and/or detect
                                           the date the case was opened).
                                                                                                       future wrongdoing.
                                           100% of employee cases without criminal prosecution
                                           potential will be completed within one year from opening
                                           the case.
2. FCA employees and managers              Allegations of wrongdoing are received in a timely          Investigations are more successful because
   recognize their responsibility to       manner and are supported by specific information.           they are initiated in a timelier manner and have
   immediately report observed or                                                                      better information.
   suspected wrongdoing to the IG.
                                                                                                       FCA employees are more willing to report real
                                                                                                       or suspected wrongdoing because they trust
                                                                                                       the competence and fairness of OIG’s
                                                                                                       investigations.
3. Agency officials and the Congress       Summaries of investigations and the resulting               The Chairman and the Congress are better
   are kept fully and currently informed   administrative or judicial actions taken are incorporated   informed about OIG investigations, and
   of problems found in the process of     into the Semiannual Report to the Congress, along with      administrative and judicial consequences.
   and resulting from investigative        any disagreements on the actions taken or failure of
                                                                                                       Public confidence in the integrity of FCA
   activities.                             management to act in a timely and responsible fashion.
                                                                                                       programs and internal operations are
                                           Findings made during the investigative process              heightened.
                                           concerning the problem at issue or systemic problems
                                           are recognized and corrected or mediated by
                                           management.
                                             Farm Credit Administration
                                             Office of Inspector General
                                                Fiscal Year 2005-2006

                                           LEGISLATIVE AND REGULATORY REVIEW
                                                           AGENCY GOAL 2

              OIG GOAL                                    PERFORMANCE MEASURE                                      OUTCOME/IMPACT
1. Maintain an effective program for       Processes are established and documented for              OIG input is part of the decision making
   reviewing and commenting on             identifying and circulating (as appropriate) relevant     process in approving or amending legislation,
   proposed and existing legislation and   documents.                                                regulations, circulars and other policy
   regulations affecting the agency and                                                              documents.
                                           Constructive comments on relevant documents are
   the Inspector General community.
                                           submitted by the deadlines requested by the office,       Constructive criticism and creative alternatives
                                           agency, or staff circulating comments.                    offered in OIG comments improve the quality
                                                                                                     and usefulness of documents initiated by the
                                           Document review activity is summarized for inclusion in
                                                                                                     agency.
                                           the Semiannual Report to the Congress.
                                                                                                     FCA Board and management are informed
                                                                                                     about the status of new or pending legislation
                                                                                                     or regulations initiated externally.
                                              Farm Credit Administration
                                              Office of Inspector General
                                                 Fiscal Year 2005-2006

                                                          OUTREACH PROGRAM
                                                    AGENCY GOALS 1 AND 2

               OIG GOAL                                    PERFORMANCE MEASURE                                        OUTCOME/IMPACT
1. Agency personnel understand and          Develop and maintain educational brochures or               Agency employees’ acceptance of and
   accept OIG’s role within FCA and the     pamphlets describing OIG roles and activities.              cooperation with OIG activities is improved
   community at large.                                                                                  through better understanding. OIG programs
                                            Facilitate feedback from agency employees and refine
                                                                                                        and products are improved through feedback
                                            products and practices based on the feedback to OIG
                                                                                                        from agency employees.
                                            products and educational materials.
2. OIG staff provides leadership to         Time and resources are provided to OIG staff members        Projects and activities of adjunct organizations
   organizations directly contributing to   as an incentive to contribute to outside organizations by   such as the Association of Government
   the Inspector General community.         serving on committees and holding offices.                  Accountants (AGA), Institute of Internal
                                                                                                        Auditors (IIA), PCIE/ECIE, Council of Counsels
                                                                                                        to Inspector Generals (CCIG), Federal Law
                                                                                                        Enforcement Training Center (FLETC), and
                                                                                                        Inspectors General Auditor Training Institute
                                                                                                        (IGATI) are improved by OIG staff contributions
                                                                                                        and participation.
                                                                                                        The IG community is more credible and
                                                                                                        effective.
3. OIG staff contributes to special         OIG staff will participate in projects that contribute to   Management practices at the agency are
   projects for improving the agency,       achieving the vision of a better agency and government.     improved by OIG staff participation in FCA
   the OIG community, and the Federal                                                                   special projects.
   government.
                                                                                                        FCA programs and operations are more
                                                                                                        effective and efficient.
                          Farm Credit Administration
                          Office of Inspector General
                             Fiscal Year 2005-2006

                                              AUDIT PLAN
BACKGROUND

          This audit plan identifies issues received from FCA management and staff as well as
          other issues identified by OIG staff. In particular, the Chief Executive Officer (CEO) and
          the 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 the Congress in the form of management challenges. OIG audits and
          inspections provide assurances to the CEO and FCA Board that programs are operating
          effectively and 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

          Two years ago, the OIG added this part of the semiannual report to highlight major
          challenges confronting the agency as it works to fulfill its mission. These challenges
          have remained for several years. While some are outside of the agency’s control, most
          should be addressed through concerted action by management. Over the past two
          years, the OIG has not observed appreciable progress by FCA management in
          addressing the challenges.

Human Capital
          The OIG recommended FCA develop a human capital plan in March 2001. FCA
          management agreed to this recommendation, yet FCA still does not have a plan three
          years later. The problem, which continues today, has been the lack of a consistent
          strategic approach to marshalling, managing, and maintaining human capital to
          maximize FCA performance and assure its accountability. In 2001, the President
          identified human capital as a critically needed management reform in the federal
          government. The General Accounting Office’s (GAO) High-Risk1 report also identified
          the human capital challenges that the government faces. The report notes Federal
          agencies face challenges in four key areas:

          •   Leadership: Top leadership in the agencies must provide the sustained, committed, and
              inspired attention needed to address human capital and related organization
              transformation issues.

          •   Strategic Human Capital Planning: Agencies’ human capital planning efforts need to be
              more fully and demonstrably integrated with mission and critical program goals.


1
    GAO/GGD-94-39 Farm Credit System Repayment of Federal Assistance and Competitive Position, March 1994
      •   Acquiring, Developing, and Retaining Talent: Additional efforts are needed to improve
          recruiting, hiring, professional development, and retention strategies to ensure that
          agencies have needed talent.

      •   Results-Oriented Organizational Cultures: Agencies continue to lack organizational
          cultures that promote high performance and accountability, and that empower and
          include employees in setting and accomplishing programmatic goals.

      In light of the changes in the competitive environment, advances in technology, and the
      tenure of its workforce; FCA needs to develop a comprehensive, integrated approach to
      human capital issues. Serious human capital shortfalls in planning and organizational
      culture pose a threat to FCA’s ability to economically, efficiently, and effectively perform
      its mission.
      The FY 2003 Performance and Accountability Report notes “Good human resources
      management is crucial to FCA’s mission and goals.” The FCA notes it has expended
      considerable effort on various tasks related to human capital such as increasing
      workforce diversity, hiring career interns, and expanding policies designed to develop,
      retain and reward employees. While these tasks are important components of a human
      capital plan, they have not been planned and coordinated as part of a cohesive strategy
      designed to produce measurable results addressing the human capital needs of the
      agency.
      FCA can improve its performance by the way that it treats and manages employees, and
      by building commitment and accountability through involving and empowering
      employees. FCA staff and its leaders must understand the rationale for making
      organizational and cultural changes. Everyone has a stake in helping to shape and
      implement initiatives as part of the agency’s efforts to meet current and future
      challenges. Effective changes can only be sustained through the cooperation of leaders
      and employees throughout the organization.

Agency Governance
      The Farm Credit Act (the Act) provides for a full time three-member Board. The Board
      members are appointed by the President and confirmed by the Senate. A small full-time
      Board presents a challenge in terms of defining the roles and responsibilities of the
      Board members relative to the governance of the agency. The Board must be able to
      engage in professional policy debate and set a sound course for the agency. During this
      reporting period, the OIG was called upon to explore several issues dealing with
      Government in the Sunshine Act, and information flow to the Board. The Board and the
      agency are most effective when they can focus on the business of the agency instead of
      the processes. The concerns over process are symptoms of unclear or unmet
      expectations among the Board members. A collegial board founded on mutual trust and
      respect is essential to FCA’s ultimate effectiveness.
      During the current and prior reporting periods, OIG reports pointed out the need to
      update and revise the Board Policy Statements. The Board’s rules of operation are a
      foundation for trust and shared expectations among Board members. Keeping
      operational policies current will reflect the managing principles of a dynamic
      organization. Up-to-date policies prevent second guessing original intent and
      interpretation of ambiguity. Each Board member must accept the rules of operation and
      be comfortable with the degree of oversight and accountability within the FCA.
       Clarification of roles is particularly important as the Board transitions with a new
       Chairman whose term began in May 2004. The Board must plan for and anticipate
       changes resulting from the succession of leadership. FCA’s leadership will be judged by
       how effective and seamless succession is accomplished. This transition is an
       opportunity for the Chairman and the Board to establish a high standard in planning for
       and enabling smooth transition.

Strategic Planning
       The FCA Board adopted a new Strategic Plan during this reporting period. The FCA
       Board worked for more than six months getting input from a cross section of
       stakeholders and taking a fresh look at the substance of FCA’s mission, goals, and
       objectives. The involvement of stakeholders and assessment of internal and external
       environments as part of strategic planning is a major milestone. In order to move to a
       results-oriented organization, FCA needs to ensure the strategic goals are well
       understood so that it aligns activities, core processes, and resources to support mission-
       related outcomes.
       The agency needs to continue to articulate its mission and core values, to pull
       employees together, and provide a clear focus in support of the agency’s objectives. In
       successful transformation efforts, developing, communicating, and constantly reinforcing
       the mission, goals, and core values give employees a sense of what the organization
       intends to accomplish, how they fit in the organization, and what they can do to help it
       succeed.
       FCA needs to consider organizational realignment to better achieve results and clarify
       accountability. Attention to organizational alignment is needed to pursue organizational
       approaches that recognize the reality of evolving technology, workforce, and other
       environmental forces. For example, as competitive sourcing, electronic government (e-
       government), financial management, and other initiatives lead to changes—how FCA
       meets its mission may need to change, including how it is organized.
       The Board and agency staff will face the significant challenge of refining performance
       measures to enhance a results-oriented culture at FCA. The agency will need to
       achieve a balance among results, public expectations, and employee issues. FCA will
       need to continue to monitor its performance measures to ensure that they challenge and
       stretch the organization. Performance measures should serve as a tool to continue the
       push into a results-oriented organization that produces tangible outcomes. FCA will
       need to take its broad performance measures and transform them into a balanced
       scorecard through the organization and down to individual performance. The
       performance management system should serve as the basis for setting expectations for
       employees’ roles in the transformation process. An effective performance management
       system fosters performance and accountability at the individual, organizational, and
       ultimately overall agency.

Financial Management
       Timely, accurate, and useful financial information is essential for making operating
       decisions day to day, managing the agency’s operations more efficiently, effectively, and
       economically, supporting results-oriented management approaches, and ensuring
       accountability on an ongoing basis. During FY 2001, FCA successfully implemented a
       financial management system using the services of the Department of Interior’s National
       Business Center. During September 2003, the agency decided to reprogram funds and
      purchase a new financial system. Management originally scheduled implementation of
      the new system during FY 2004. However, implementation has been delayed a year.
      Management’s challenge is to bring yet another system on line at a reasonable cost to
      the FCA and concurrently leverage the system to deliver timely financial information
      critical for making well-informed management decisions. The challenge forces the
      agency to develop new measures of financial management success. Financial
      management success goes far beyond an unqualified financial statement audit opinion.
      Measures such as delivering financial information that managers can use for day-to-day
      operations, and developing reports that capture the full cost of programs and projects
      can help bring about a transition.
      Financial management represents a challenge that goes far beyond financial accounting
      to the very fiber of FCA’s business operations and management culture. FCA needs to
      ensure that underlying financial management processes, procedures, and information
      are in place for effective program management. FCA already has information readily
      available; however, management seems to be stuck in controlling the distribution of the
      information. This type of information control serves as a roadblock to improved
      management. FCA needs to take steps to get information into the hands of managers.
      FCA will also need to improve managers’ ability to use the information to measure,
      control, and manage costs, to manage for results, and to make timely and fully informed
      decisions about allocating limited resources.

Security and Disaster Preparedness
      A year ago, the OIG noted that the Continuity of Operations Plan needed to be updated
      and practiced. The OIG provided management with concrete suggestions to improve
      the level of preparedness in the event of a disaster. The suggestions could facilitate an
      expedited effort to prepare for an emergency. To date, management has not provided a
      credible plan for employees to follow in the event of a disaster. The agency distributed
      emergency kits to employees and conducted a drill that demonstrated significant
      confusion. However, there has not been a noticeable effort to identify and remedy
      weaknesses uncovered in the drill. The agency’s level of preparedness is a
      management challenge that leaves it vulnerable to significant disruption in operations in
      the event of an emergency.
      The OIG found a strong foundation for security practices in the technology area. The
      speed of change in the security environment will be a challenge for all government
      organizations. This is especially true and a challenge for smaller organizations like FCA
      where an increased emphasis on physical and information security competes with
      program areas for tight budget funding.

Leveraging Technology
      Information technology (IT) is a key element of management reform efforts that can help
      dramatically reshape government to improve performance and reduce costs. Advances
      in the use of IT continue to change the way that Federal agencies communicate, use
      and disseminate information, deliver services, and conduct business. However, for FCA
      to realize IT’s promise, significant challenges will need to be overcome. 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 skills to use technology to operate in an
      efficient manner.
       IT must complement human capital initiatives to reformulate the work processes of FCA.
       In order for this to come about, FCA will need to invest in training and reward employees
       who are able to develop innovative approaches to accomplish agency goals using
       technology.

       E-government offers many opportunities to better serve the public, make FCA more
       efficient and effective, and reduce costs. FCA has begun to implement some e-
       government applications, including the use of the Internet to collect and disseminate
       information and forms. Although it has made progress, FCA has not fully reached its
       potential in this area. The FCA needs to: (1) focus on customers by soliciting input from
       the public and conducting user needs assessments; and (2) develop partnerships with
       other agencies to collaborate strategies.

Farm Credit System Risk
       The Farm Credit System (FCS) is a single industry lender and is vulnerable to economic
       swings. The FCA is challenged to balance the often competing demands of ensuring the
       FCS fulfills its public purpose, proactively examining risk in the regulated institutions both
       individually and systemically, and controlling the cost of the regulator. As the Farm
       Credit Act has aged, it has become challenging for FCA to address increasingly complex
       issues such as syndications and preferred stock. FCA and FCS will be challenged to
       adapt modern financial markets as the Act continues to age.

AUDITS AND INSPECTIONS

Audit of Financial Statements
       The OIG contracts with an independent accounting firm to conduct an audit of FCA
       financial statements. During FY 2004, the OIG will deliver the audit opinion on the
       financial statements as of September 30, 2003. This year, there is an expectation by
       management and the Office of Management and Budget (OMB), that audit opinions will
       be issued and the agency Performance and Accountability report will be published by
       November 15, 2004. OIG will incorporate more interim audit work in its contract to
       ensure expectations are met.
       During FY 2004, the OIG exercised the second year option with the auditing firm that
       completed last fiscal year’s audit to complete the audit of the agency’s financial
       statements as of September 30, 2004. This reduces the OIG’s costs associated with
       managing a contract during the first year of an engagement.

Financial Information Security Management Act (FISMA)
       The Financial Information Security Management Act (FISMA) 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.

Human Capital
       The OIG issued a report on the job evaluation program in June 2004. The next audit will
       evaluate the “pay-for-performance” system.
Government Performance and Review Act
       This activity will evaluate the agency’s compliance with the Government Performance
       and Review Act (GPRA). 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:
           •   FCA Policy Regulatory Development Process
           •   Financial Information for Management Decisions
           •   Implementation of Risk-based Examinations
           •   Leveraging Technology on Examinations
           •   OSMO —FCA’s Effectiveness as a Dual Industry Regulator
           •   Comparison of SESD and OPA—Costs and Products
           •   OGC Legal Opinion Process, Efficiency, and Effectiveness
           •   FCA Commission Program
           •   Borrower Complaint Handling
           •   FOIA Program
           •   Office Quality Control Program
           •   Quality and Consistency of Examinations
           •   Evaluation of Physical Security Practices and Emergency Preparedness
           •   PPM Process
           •   Improper Payments
           •   Impact of Special Supervision on Correcting Problems in Institutions
           •   Review of Vulnerability Assessment
           •   HIPAA Compliance

Other Audit-Related Activities
       During the planning, the OIG expects to conduct audit follow-up activities to evaluate:
           •   The effectiveness of prior recommendations,
           •   The effectiveness of agreed upon actions compared to recommendations, and
           •   The effectiveness of management advisories.
                  Farm Credit Administration
                  Office of Inspector General
                     Fiscal Year 2005-2006

     STAFFING AND RESOURCE NEEDS AND DISTRIBUTION
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.

OIG 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 of the OIG staff. He is also an advisor 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 .81 FTE.

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

The 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.

The Management Analyst is responsible for budgeting, procurement, training, personnel
management, and for general administrative support to the rest of the staff. The position is
responsible for the preparation of the Farm Credit System Annual Survey report and
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.

OIG PRODUCTS AND SERVICES

Audit and Inspections are the primary vehicles through which the 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 it 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.

OIG’S MISSION, VISION AND IMPLICATIONS FOR STAFFING

It is the OIG’s goal to be an agent for positive change, striving for continuous improvement
in agency management and program operations, including our own office. Our mission is to
be a leader and a 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, and mutual support from office teammates.

STAFFING ASSESSMENT AND STRATEGIES

OIG’s diverse responsibilities prescribed by the Act dictate the presence of certain
competencies within the OIG 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,
investigations, law, management, and administration. The 5.12 FTE in this plan constitutes
the critical mass to credibly perform OIG’s responsibilities. Conversely, the related level of
risk at FCA does not warrant either an increase in the number of FTE or change in the mix
of competencies.

OIG staff performs 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.
The Counsel, the Investigator and the 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 five years, OIG reduced staff by 30
percent (2 auditor positions).

The current OIG permanent 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.

STAFFING OBJECTIVES, STRATEGIES AND ASSUMPTIONS

Objectives

   •   Retain and refine the skills and competencies represented by the current staff profile

   •   Increase the diversity of the 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 among 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 among OIG staff.

   •   Intern programs will be used to identify possible future permanent staff.
 Farm Credit Administration
 Office of Inspector General
    Fiscal Year 2005-2006

       OIG TIME BY PRODUCTS
       (allocating indirect time)


      12%
 4%
                                    Audits
                            47%
                                    Investigations
                                    Leg/Reg Review
                                    Outreach
37%




                                                     .
                     Farm Credit Administration
                     Office of Inspector General
                        Fiscal Year 2005-2006

                                 IRM PLAN SUMMARY
IRM Budget       Object    FY 2005   FY 2006   FY 2007   FY 2008   FY 2009   FY 2010    Total
Category         Code       Costs     Costs     Costs     Costs     Costs     Costs     Costs

Telephone &      2329          600       600       600       600       600       600      3,600
Communications
Services

Consulting       2510       35,000    35,000    40,000    40,000    40,000    45,000    235,000
Services

IT Equipment     3140        1,300         0    18,300       400       800         0     21,600

Software         3143          500       500       500       500       500       500      3,000

                   Total   $37,400   $36,100   $59,400   $41,500   $41,900   $46,100   $263,200
                          Farm Credit Administration
                          Office of Inspector General
                             Fiscal Year 2005-2006

                     FY 2005 REVISED PERFORMANCE BUDGET
                             by Performance Objectives
                                                                  Direct       Indirect
               Program Activities                    Total Cost                               Total FTE
                                                                  Cost           Cost
1.0 Policy and Regulation                                     0            0                        0.00
1.1 Regulation 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 Implement the President’s Management                      0            0              0         0.00
Agenda
3.1 Strategically manage human capital                        0                           0         0.00
3.2 Upgrade the agency’s financial management                 0                           0         0.00
system
3.3 Continue the expansion of e-government                    0                           0         0.00
3.4 Continue evolution of budget & performance                0                           0         0.00
integration
3.5 Give due consideration to competitive sourcing            0                           0         0.00

4.0 Reimbursable Activities                                   0                                     0.00
4.1 SBA                                                       0            0                        0.00
4.2 USDA                                                      0            0                        0.00
4.3 FCSIC                                                     0            0                        0.00
4.4 NCB/NCB Development Corporation                           0            0                        0.00

5.0 Distributed Costs                                   951,601                  951,601            5.12
5.1 Budget and Financial Management                           0                           0         0.00
5.2 Human Resources Management                                0                           0         0.00
5.3 Information Resources Management                          0                           0         0.00
5.4 Other Legal Counsel                                       0                           0         0.00
5.5 Communication                                             0                           0         0.00
5.6 Contracting, Procurement, Mail and Supply                 0                           0         0.00
5.7 Board Activities and Information Services                 0                           0         0.00
5.8 Congressional and Intergovernmental Affairs               0                           0         0.00
                         Farm Credit Administration
                         Office of Inspector General
                            Fiscal Year 2005-2006

                      FY 2005 REVISED PERFORMANCE BUDGET
                              by Performance Objectives
                                                                  Direct       Indirect
               Program Activities                    Total Cost                               Total FTE
                                                                  Cost           Cost
5.9 Records Management and Information Services               0                           0         0.00
5.10 Audit and Investigations                           951,601                  951,601            5.12
5.11 Administration                                           0                           0         0.00
5.12 OSMO/Farmer Mac (non-exam activities)                    0                           0         0.00

                                             Total     $951,601            0    $951,601            5.12
                          Farm Credit Administration
                          Office of Inspector General
                             Fiscal Year 2005-2006

                  FY 2005 REVISED PRODUCTS AND SERVICES
                            by Object Classification
                                                                 PS 5.10
Resources                                          Total         Audits and     PS #       PS #       PS #       PS #
                                                               Investigations

Full-time Equivalents (FTE)                           5.12             5.12      0.00       0.00       0.00       0.00
% of costs distributed on the basis of FTE            1.00             1.00      0.00       0.00       0.00       0.00
                                          Total   $951,601       $951,601

Object Classification
11.1 Full-time permanent                           466,360         466,360             0          0          0      0
11.3 Other than full-time permanent                123,943         123,943             0          0          0      0
11.5 Other personnel compensation                    2,000            2,000            0          0          0      0
                                      Subtotal     592,303         592,303             0          0          0      0

12.1 Personnel benefits               Subtotal     180,548         180,548             0          0          0      0

13.0 Benefits to former personnel     Subtotal             0               0           0          0          0      0

21.0 Travel & transportation of person                                                 0          0          0      0
                                    Subtotal        10,000          10,000

22.0 Transportation of things       Subtotal         1,000            1,000            0          0          0      0

23.2 Rental payments to others                             0               0           0          0          0      0
23.3 Communications, utilities, & misc.              4,750            4,750            0          0          0      0
                                      Subtotal       4,750            4,750            0          0          0      0

24.0 Printing and reproduction        Subtotal       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                                119,100         119,100             0          0          0      0
25.3 Other purchases from Govt accounts              3,000            3,000            0          0          0      0
25.7 Operation & maintenance of equipment                  0               0           0          0          0      0
                                      Subtotal     157,100         157,100             0          0          0      0

26.0 Supplies and materials         Subtotal         3,600            3,600            0          0          0      0

31.0 Equipment                        Subtotal       2,200            2,200            0          0          0      0

42.0 Insurance claims & indemnities                        0               0           0          0          0      0
                                   Subtotal

92.0 Undistributed                    Subtotal             0               0           0          0          0      0
                                          Total   $951,601       $951,601              0          0          0      0
                         Farm Credit Administration
                         Office of Inspector General
                            Fiscal Year 2005-2006

                     FY 2005 REVISED PRODUCTS AND SERVICES
The accomplishment of the Office Inspector General’s products and services correlate to fulfilling
our goals and objectives.

    Products/Service2                             Budget         % Budget         FTE            % FTE

    Audits, Inspections, and Review Products    $447,253             47%           2.42           47%

    Investigations                              $352,092             37%           1.89           37%

    Regulation Review and Comment               $114,192             12%            .61           12%

    Outreach                                      $38,064             4%            .20            4%

    Centrally Budgeted Items                            0               0             0              0

                                        Total   $951,601            100%           5.12           100%

Audits, Inspections, and Review Products—The OIG evaluates approximately 6-10 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, which
is directly linked to the FCA Strategic Plan.

Budget for FY 2005—$447,253                                                                     2.42 FTE

Investigative Function—Allegations received by the OIG are reviewed by testing information
provided to determine whether an investigation should be opened. Investigations are conducted
when appropriate. Maintaining the OIG HOTLINE and directing FCS Borrower issues to agency
components are additional functions of the investigative service.

Budget for FY 2005—$352,092                                                                     1.89 FTE

Review and Comment on Proposed and Existing Regulations and Legislation—The OIG
reviews, comments and responds to Congressional and executive requests and inquiries.
Additionally the OIG reviews and comments on proposed and existing legislation and regulations
affecting the agency and the Inspector General community.

Budget for FY 2005—$114,192                                                                      .61 FTE


2
    Management, administrative support and leave are disbursed across the four program areas.
                     Farm Credit Administration
                     Office of Inspector General
                        Fiscal Year 2005-2006

                FY 2005 REVISED PRODUCTS AND SERVICES

Outreach Program—The OIG educates the agency employees about OIG’s role within the
agency. The OIG lends leadership to organizations directly contributing to the IG community.
Through involvement in special projects and workgroups, the OIG makes contributions for
improving the agency, the OIG community and the Federal government. This includes but is not
limited to: the Semiannual Report to the Congress, and participation in external activities such
as membership on the ECIE and the CCIG. We also participate in agency efforts, such as
Government Performance Results Act (GPRA) initiative, Employee’s Council, Administrative
Burden Workgroup, Blacks in Government, Continuity of Operations Plan, FCA Compensation
Study, and the Federal Women’s Program.

Budget for FY 2005—$38,064                                                             .20 FTE
                      Farm Credit Administration
                      Office of Inspector General
                         Fiscal Year 2005-2006

              FY 2005 REVISED BUDGET AND JUSTIFICATIONS
TOTAL OFFICE BUDGET                                                                      $951,601

   Total approved IRM Plan amount included in Office Budget                               $ 37,400

1100 Personnel Compensation                                                              $592,303

Amount required to fund salaries of OIG staff (5.12 FTE) charged with conducting audits and
investigations related to agency programs and operations. We are also responsible for
reviewing existing and proposed legislations and regulations to evaluate their impact on the
agency and on the prevention of fraud and abuse. Funds are also allocated for cash awards for
deserving employees.

1200 Personnel Benefits                                                                   $180,548

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

1300 Benefits for Former Personnel                                                         $ --

N/A

2100 Travel and Transportation of Persons                                                 $ 10,000

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

2200 Transportation of Things                                                              $      100

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

2300 Rent, Communications, Utilities, and Miscellaneous                                    $ 4,750

   2300 Approved IRM Plan                                                                   $     600

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 the 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. The independent internet account is used for confidential
reporting of fraud, waste, abuse, and mismanagement. The pager service is used by the
Inspector General. Counsel to the IG uses Lexis/Nexis for research capabilities.
                      Farm Credit Administration
                      Office of Inspector General
                         Fiscal Year 2005-2006

              FY 2005 REVISED BUDGET AND JUSTIFICATIONS

2400 Printing and Reproduction                                                              $ 1,000

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

2500 Other Contractual Services                                                            $157,100

   2500 Approved IRM Plan                                                                   $ 35,000

Contract services will be needed to assist in staff reviews of programs, including FISMA and
financial statements audits. 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 the U.S. Department of Agriculture (USDA), FLETC, and other government agencies.
They will also be used for contracts used by other government agencies such as Department of
Labor (DOL) and General Services Administration (GSA) for independent reviews of such things
as the agency’s financial statements and the OMB required IT security audit. Government
Information Security Reform Act (GISRA) requires agencies to perform an audit of IT security on
an annual basis.

2600 Supplies and Materials                                                                     $ 3,600

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                                                                               $ 2,200

   2300 Approved IRM Plan                                                                   $     1,800

Purchase equipment and software as necessary to support IG programs.
                          Farm Credit Administration
                          Office of Inspector General
                              Fiscal Year 2005-2006

                     FY 2006 PROPOSED PERFORMANCE BUDGET
                              by Performance Objectives
Program Activities                                                  Direct       Indirect       Total FTE
                                                       Total Cost
   Products and Services                                            Cost           Cost
1.0 Policy and Regulation                                       0            0                       0.00
1.1 Regulation 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 Implement the President’s Management Agenda                 0                           0        0.00
3.1 Strategically manage human capital                          0                           0        0.00
3.2 Upgrade the agency’s financial management system            0                           0        0.00
3.3 Continue the expansion of e-government                      0                           0        0.00
3.4 Continue the evolution of budget & performance              0                           0        0.00
integration
3.5 Give due consideration to competitive sourcing              0                           0        0.00

4.0 Reimbursable Activities                                     0            0                       0.00
4.1 SBA                                                         0            0                       0.00
4.2 USDA                                                        0            0                       0.00
4.3 FCSIC                                                       0            0                       0.00
4.4 NCB/NCB Development Corporation                             0            0                       0.00

5.0 Distributed Costs                                     954,854                  954,854           5.12
5.1 Budget and Financial Management                             0                           0        0.00
5.2 Human Resources Management                                  0                           0        0.00
5.3 Information Resources Management                            0                           0        0.00
5.4 Other Legal Counsel                                         0                           0        0.00
5.5 Communication                                               0                           0        0.00
5.6 Contracting, Procurement, Mail and Supply                   0                           0        0.00
5.7 Board Activities and Information Services                   0                           0        0.00
5.8 Congressional and Intergovernmental Affairs                 0                           0        0.00
5.9 Records Management and Information Services                 0                           0        0.00
                          Farm Credit Administration
                          Office of Inspector General
                              Fiscal Year 2005-2006

                      FY 2006 PROPOSED PERFORMANCE BUDGET
                               by Performance Objectives
5.10 Audit and Investigations                         954,854        954,854   0.00

5.11 Administration                                        0              0    0.00
5.12 OSMO/Farmer Mac (non-exam activities)                 0              0    0.00

                                             Total   $954,854   0   $954,854   5.12
                        Farm Credit Administration
                        Office of Inspector General
                           Fiscal Year 2005-2006

               FY 2006 PROPOSED PRODUCTS AND SERVICES
                          by Object Classification
                                                              PS 5.10
Resources                                        Total         Audits and     PS #       PS #       PS #       PS #
                                                             Investigations

Full-time Equivalents (FTE)                         5.12              5.12     0.00       0.00       0.00       0.00
% of costs distributed on the basis of FTE          1.00              1.00     0.00       0.00       0.00       0.00
                                        Total   $954,854       $954,854

Object Classification
11.1 Full-time Permanent                         446,360         446,360             0          0          0      0
11.3 Other than full-time permanent              123,943         123,943             0          0          0      0
11.5 Other personnel compensation                  2,000            2,000            0          0          0      0
                                   Subtotal      592,303         592,303             0          0          0      0

12.1 Personnel benefits           Subtotal       186,351         186,351             0          0          0      0

13.0 Benefits to former personnel Subtotal               0                0          0          0          0      0

21.0 Travel & transportation of person                                               0          0          0      0
                                   Subtotal       10,000          10,000

22.0 Transportation of things     Subtotal          100               100            0          0          0      0

23.2 Rental payments to others                           0                0          0          0          0      0
23.3 Communications, utilities, & misc.            3,750            3,750            0          0          0      0
                                   Subtotal        3,750            3,750            0          0          0      0

24.0 Printing and reproduction    Subtotal         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                              119,100         119,100             0          0          0      0
25.3 Other purchases from Govt accounts            3,000            3,000            0          0          0      0
25.7 Operation and maintenance of equip.                 0                0          0          0          0      0
                                   Subtotal      157,100         157,100             0          0          0      0

26.0 Supplies and materials        Subtotal        3,750            3,750            0          0          0      0

31.0 Equipment                    Subtotal          500               500            0          0          0      0

42.0 Insurance claims & indemnities                      0                0          0          0          0      0
                                  Subtotal

92.0 Undistributed                Subtotal               0                0          0          0          0      0
                                        Total   $954,854       $954,854              0          0          0      0
                         Farm Credit Administration
                         Office of Inspector General
                            Fiscal Year 2005-2006

                           FY 2006 PRODUCTS AND SERVICES
The accomplishment of the Office Inspector General’s products and services correlate to
fulfilling our goals and objectives.

    Products/Service3                             Budget        % Budget          FTE            % FTE

    Audits, Inspections, and Review Products    $448,782             47%           2.42           47%

    Investigations                              $353,296             37%           1.89           37%

    Regulation Review and Comment               $114,582             12%            .61           12%

    Outreach                                     $38,194              4%            .20            4%

    Centrally Budgeted Items                            0               0             0              0

                                        Total   $954,854           100%            5.12          100%

Audits, Inspections, and Review Products— The OIG evaluates approximately 6-10 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, which
is directly linked to the FCA Strategic Plan.

Budget for FY 2006—$448,782                                                                     2.42 FTE

Investigative Function— Allegations received by the OIG are reviewed by testing information
provided to determine whether an investigation should be opened. Investigations are conducted
when appropriate. Maintaining the OIG HOTLINE and directing FCS Borrower issues to agency
components are additional functions of the investigative service.

Budget for FY 2006—$353,296                                                                     1.89 FTE

Review and Comment on Proposed and Existing Regulations and Legislation—The OIG
reviews, comments and responds to Congressional and executive requests and inquiries.
Additionally the OIG reviews and comments on proposed and existing legislation and regulations
affecting the agency and the Inspector General community.

Budget for FY 2006—$114,582                                                                      .61 FTE


3
    Management, administrative support and leave are disbursed across the four program areas.
                     Farm Credit Administration
                     Office of Inspector General
                        Fiscal Year 2005-2006

                       FY 2006 PRODUCTS AND SERVICES

Outreach Program—The OIG educates the agency employees about OIG’s role within the
agency. The OIG lends leadership to organizations directly contributing to the IG community.
Through involvement in special projects and workgroups, the OIG makes contributions for
improving the agency, the OIG community and the Federal government. This includes but is not
limited to: the Semiannual Report to the Congress, and participation in external activities such
as membership on the ECIE and the CCIG. We also participate in agency efforts, such as
Government Performance Results Act (GPRA) initiative, Employee’s Council, Administrative
Burden Workgroup, Blacks in Government, Continuity of Operations Plan, FCA Compensation
Study, and the Federal Women’s Program.

Budget for FY 2006—$38,194                                                             .20 FTE
                      Farm Credit Administration
                      Office of Inspector General
                         Fiscal Year 2005-2006

                     FY 2006 BUDGET AND JUSTIFICATIONS
TOTAL OFFICE BUDGET                                                                      $954,854

   Total approved IRM Plan amount included in Office Budget                                $36,100

1100 Personnel Compensation                                                              $592,303

Amount required to fund salaries of OIG staff (5.12 FTE) charged with conducting audits and
investigations related to agency programs and operations. We are also responsible for
reviewing existing and proposed legislations and regulations to evaluate their impact on the
agency and on the prevention of fraud and abuse. Funds are also allocated for cash awards for
deserving employees.

1200 Personnel Benefits                                                                   $186,351

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

1300 Benefits for Former Personnel                                                        $ --

N/A

2100 Travel and Transportation of Persons                                                 $ 10,000

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

2200 Transportation of Things                                                             $       100

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

2300 Rent, Communications, Utilities, and Miscellaneous                                    $ 3,750

   2300 Approved IRM Plan                                                                 $       600

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 the Congress and other groups, and pager service for the Inspector
General. Funds will also cover Lexis/Nexis service and a separate internet access fro the
anonymous hotline account. The independent internet account is used for confidential reporting
of fraud, waste, abuse, and mismanagement. The pager service is used by the Inspector
General. Counsel to the IG uses Lexis/Nexis for research capabilities.
                      Farm Credit Administration
                      Office of Inspector General
                         Fiscal Year 2005-2006

                     FY 2006 BUDGET AND JUSTIFICATIONS

2400 Printing and Reproduction                                                              $ 1,000

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

2500 Other Contractual Services                                                            $157,100

   2500 Approved IRM Plan                                                                   $ 35,000

Contract services will be needed to assist in staff reviews of programs, including FISMA and
financial statements audits. 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
used by other government agencies such as DOL and GSA for independent reviews of such
things as the agency’s financial statements and the OMB required IT security audit. GISRA
requires agencies to perform an audit of IT security on an annual basis.

2600 Supplies and Materials                                                                 $   3,750

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                                                                              $    500

   3100 Approved IRM Plan                                                                   $     500

Purchase software as necessary to support IG programs.
                              Farm Credit Administration
                              Office of Inspector General
                                 Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                  Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                  Number     Actual        Actual       Revised       Revised       Proposed

1.0 Policy and Regulation                         0             0             0                 0          0

1.1 Regulation and Development                    0             0                 0             0          0
   Competition/Regulation          3177               0             0
   Review
   Regulatory Burden               3178           0                 0
   Termination/Banks and           3180               0             0
   Large Associations
   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               3306           0             0
   Texas FCB Litigation            3313               0             0
   Capital and Financial Risk      3315               0             0
   Management
   Electronic Commerce (FCS)       3318               0             0
   Distressed Loan                 3323               0             0
   Restructuring
   Effective Interest Rate         3324           0             0
   Credit and Related Services     3325           0             0
   FCS Institution Structure       3326           0             0
   Enforcement Authorities         3327           0             0
   FCS/GSE Mission                 3328           0             0
   Flood Insurance (CMP)           3329           0             0
   Section 508 Compliance          3338           0             0
   Capital/Technical               3345               0             0
   Amendments
   Capital Leverage Ratio          3346           0                 0
                           Farm Credit Administration
                           Office of Inspector General
                              Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                 Project    FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                 Number      Actual        Actual       Revised       Revised       Proposed

   Young, Beginning, and          3349                0             0
   Small Farmers (YBS)
   Loan Syndications              3350            0             0
   Scope and Eligibility          3351            0             0
   Regulatory Burden              3352                0             0
   Solicitation
   Governance of FCS              3353                0             0
   Institutions

1.2 Statutory & Regulatory Approvals              0             0             0             0              0
   Corporate Activity             3204            0             0
   Funding Approvals              3205                          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          506            0             0
   General Examination            2026            0             0
   OE QA                          2042                0             0
   Program/Vulnerability
   Training Development           2048            0             0
   OE Workshops/Conferences       2050            0             0
   Automated IS Issues            2335            0             0
   Exam Manual Update             2640                0             0
   CMS Activities                 2983            0             0
   Legal Support for OE           3175                0             0
   E-Commerce Task Force          3307            0             0
   OE Modernization Project       3317            0             0
   Commission Test                3320                0             0
   Development
   FAMC Monitoring/Oversight      3366

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            3172                0             0
                         Farm Credit Administration
                         Office of Inspector General
                            Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                   Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                   Number     Actual        Actual       Revised       Revised       Proposed
   Monitoring
   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 Implement the President’s Management               0             0             0             0          0
 Agenda

3.1 Strategically manage human capital             0             0                 0             0          0

3.2 Upgrade the agency’s financial                     0             0             0             0          0
management system

3.3 Continue the expansion of e-                       0             0             0             0          0
government

3.5 Give due consideration to competitive              0             0             0             0          0
sourcing

4.0 Reimbursable Activities                        0             0             0             0              0

4.1 SBA                                            0             0                 0             0          0
   SBA Project Management            3143          0             0
   SBA Training                      3319          0             0
   SBLC-Commercial Capital         1900701             0             0
   Corporation
   SBLC-Business Loan              1900702             0             0
   Center, Inc.
   SBLC-Grow America Fund,         1900703             0             0
   Inc.
   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                 1900708             0             0
   Commercial Corporation
   SBLC-Small Business Loan        1900709             0             0
   Source, Inc.
                           Farm Credit Administration
                           Office of Inspector General
                              Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                               Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                               Number     Actual        Actual       Revised       Revised       Proposed

   SDBLC-Allied Capital SBLC   1900710         0             0
   SBLC-Transamerica           1900711         0             0
   SBLC-Money Store            1900712         0             0
   SBLC-Heller First Capital   1900713             0             0
   Corporation
   SBLC-GE Capital             1900714         0             0

4.2 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           3354               0             0
   Agricultural Research
   Corporation
   USDA – Business Loan        2500001             0             0
   Express
   USDA – B&I Lending          2500002             0             0
   USDA – Carolina Capital     2500003         0             0

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

4.4 NCB/NCB Development Corporation            0             0             0             0              0
   FCA Support of NCB           3280               0             0
   FCA Support of NCB           3281               0             0
   Development Corporation
   Legal Counsel NCB            3285               0             0
   Development Corporation
   NCB                         2000100         0             0

5.0 Distributed Costs                    $793,617      $796,659      $896,937      $951,601       $954,854

5.1 Budget and Financial Management            0           $44             0             0              0
   Financial Management         3234               0             0
   Policies
   Budgeting and Analysis       3235           0            44
   Financial Management         3236               0             0
   Systems
                           Farm Credit Administration
                           Office of Inspector General
                              Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                 Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                 Number     Actual        Actual       Revised       Revised       Proposed

   Financial Reports and          3237               0             0
   Statements
   Accounting Duties              3238           0             0
   Financial Management           3322               0             0
   Guidance

5.2 Human Resources Management              $13,335        $1,545            0             0              0
   Training Taken                 3001        5,668         1,301
   Personnel and Payroll          3161               0             0
   Processing
   Compensation and Benefits      3162           0             0
   Training Administration and    3163               0       244
   Development
   Staffing and Job Evaluation    3164        3,500            0
   Employee Management            3165               0             0
   Relations
   Training G2                    3222           0             0
   Training Development G2        3223           0             0
   Other Administration G2        3225           0             0
   Structural Streamlining        3334           0             0
   Bonus Performance              3339        3,882            0
   Payments
   FCA Compensation Study         3341         285             0
   Executive Leadership           3342               0             0
   Program
   Human Development and          3356               0             0
   Investment

5.3 Information Resources Management           $95        $15,710                0             0          0
   System Development             3229           0             0
   User Support                   3230           0             0
   NT and Network                 3231               0             0
   Management
   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
                          Farm Credit Administration
                          Office of Inspector General
                             Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                 Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                 Number     Actual        Actual       Revised       Revised       Proposed

   IRMOC                          3330           0             0
   IRM Planning                   3331           0             0
   IT Security                    3340          95                 0
   T29 Laptop Replacement         3359           0         15,710

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

5.5 Communication                                0           $15                 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          3171               0             0
   Conferences
   Government Coordination        3207           0             0
   System Liaison                 3208           0            15
   Media and Public Affairs       3209           0             0
   International Programs         3211           0             0
   Informational Memoranda        3212           0             0
   Publication Editing            3214           0             0
   Meeting Planning               3215           0             0
   Plain Language Initiative      3216           0             0
   Internal Communication G2      3219           0             0
   Internal Communication         3247           0             0
   FCA Web Site                   3333           0             0

5.6 Contracting, Procurement, Mail and               0             0             0             0          0
Supply
   Procurement                    3239           0             0
   Mail Administration            3240           0             0
   Supplies Administration        3241           0             0
   Transportation                 3242               0             0
   Administration

5.7 Board Activities and Board Support        $250          $233                 0             0          0
   Board Support Initiatives      2357           0             0
                            Farm Credit Administration
                            Office of Inspector General
                               Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                 Project       FY 2002           FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                 Number         Actual            Actual       Revised       Revised       Proposed

   Board Support Initiatives      2989               0                 0
   Board Support                  3213             250                 0
   Board Member Activity          3335               0               233

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

5.9 Records Management and Information            $125              $128                 0             0          0
Services
   Information Center and         3226             125               128
   Records Management

5.10 Audits and Investigations                 $629,034          $646,197      $896,937      $951,601       $954,854
   OIG Time                       1425          629,034           646,197       896,937       951,601        954,954
   Audit, QA and Internal         3221                   0                 0
   Control
   Audit, QA and Internal         3249                   0                 0
   Control

5.11 Administration                            $120,778          $132,787                0             0          0
   General Administration         3002             293               328
   Planning                       3004             127               351
   Clerical & Admin. Support      3005                   0                 0
   Year 2000 Activities           3006               0                 0
   Best Practices                 3059               0                 0
   Year 2000                      3063                   0                 0
   Management and                 3160                   0                 0
   Supervision
   Management G2                  3217               0                 0
   Planning and Budgeting G2      3218               0                 0
   Clerical & Admin. Support      3220                   0                 0
   G2
   Technical Committees           3224               0                 0
   FCS Building Association       3243                   0                 0
   Liaison
   Leave                          3244          120,117           132,108
                         Farm Credit Administration
                         Office of Inspector General
                            Fiscal Year 2005-2006
  PERFORMANCE BY PROJECTS, PRODUCTS AND SERVICES AND PROGRAM
                     ACTIVITIES, FY 2002-2006
                                 Project   FY 2002       FY 2003       FY 2004       FY 2005        FY 2006
Program Activities
                                 Number     Actual        Actual       Revised       Revised       Proposed

   Management G3                  3245           0             0
   Planning and Budgeting G3      3246           0             0
   Clerical and Administrative    3248               0             0
   Support G3
   Other Administration G3        3250           0             0
   Ethics Program                 3251         241             0
   FOIA and Release               3252               0             0
   Information
   EEO                            3254           0             0
   Agency Compliance              3287           0             0
   FCA Mentoring Program          3288           0             0

5.12 OSMO/Farmer Mac (non-exam                       0             0             0             0          0
activities
   Legal Counsel – OSMO           3276           0             0
   Risk-Based Capital Rule        3277           0             0
   OSMO Activities                3290           0             0
   Farmer Mac Call Reports        3347           0             0
   Farmer Mac Issues              3348           0             0

                                  TOTAL    $763,617      $796,659      $896,937      $951,601       $954,854
                                                 Farm Credit Administration
                                                 Office of Inspector General
                                                     Fiscal Year 2005-2006
                                            BUDGET HISTORY SUMMARY, FISCAL YEAR 2002-2004

                                                          FISCAL YEAR 2002                          FISCAL YEAR 2003                            FISCAL YEAR 2004
Object Classification                             Budget      Obligated    Balance         Budget       Obligated    Balance            Budget      Obligated     Balance
Awards (1154)                                      2,000.00       450.00    1,550.00        2,000.00        831.00    1,169.00           2,000.00        60.00     1,940.00
Travel (2101)                                     19,000.00     6,970.66   12,029.34       12,236.00      1,526.00   10,710.00          15,000.00     1,156.89   13,843.11
Transportation of Things (2213)                     N/A          N/A         N/A              100.00            ---      100.00          1,000.00           ---    1,000.00
Telephone and Communications Services (2329)       1,600.00       399.24    1,200.76          600.00            ---      600.00            600.00       215.40       384.60
Messenger and Courier Services (2335)              N/A           N/A         N/A              150.00            ---      150.00            150.00           ---      150.00
Commercial Printers (2403)                         1,000.00       830.00      170.00        1,000.00         75.00       925.00          1,000.00           ---    1,000.00
Advisory Assistance Services (2510)                5,000.00           ---   5,000.00       15,000.00      6,719.00    8,281.00          30,000.00           ---  30,000.00
Training (2525)                                   19,000.00    12,162.93    6,837.07        3,500.00      2,631.00       869.00          3,500.00     3,430.00        70.00
Convenience Check Fees (2524)                      N/A           N/A         N/A                  ---       122.53     (122.53)                           1.87        (1.87
Membership Fees (2526)                              N/A          N/A         N/A              500.00            ---      500.00            500.00       214.38       285.62
Other Contractural Services (2528)               103,000.00    93,808.03    9,191.97      128,000.00     77,462.40   50,537.60         115,000.00    89,874.71   25,125.29
Training Government (2535)                          N/A          N/A         N/A            3,000.00      2,010.00       990.00          3,000.00     7,980.00   (4,980.00)
Supplies (2609)                                    3,500.00       959.76    2,540.24        2,000.00      1,188.02       811.98          2,000.00       284.43     1,715.57
Other non-Cash Awards & Gifts (2614)                N/A          N/A         N/A            1,000.00        859.60       140.40          1,000.00           ---    1,000.00
Subscriptions and Publications (2639)              N/A           N/A         N/A              500.00        466.98        33.02            500.00       482.18        17.82
Non-IT Equipment, Furniture & Fixtures (3109)      4,000.00           ---   4,000.00          500.00        285.44       214.56            500.00           ---      500.00
IT Equipment (3140)                                 N/A          N/A         N/A              800.00            ---      800.00         10,900.00        67.95   10,832.05
Software (3143)                                      800.00       270.06      529.94          500.00            ---      500.00            500.00           ---      500.00


                                                $158,900.00   $115,580.62   $43,049.32   $ 71,386.00   $ 94,176.97      $ 77,209.03   $187,150.00   $103,767.81   $83,382.19




                                           AVERAGE OF BUDGETED VS. OBLIGATED, FY 2002-2004
                                                               Average                                                                               Average
Object Classification                           Budgeted      Obligated     Balance         Object Classification                     Budgeted      Obligated     Balance
Awards (1154)                                     2,000.00        447.00     1,553.00       Membership Fees (2526)                        500.00         107.19       392.81
Travel (2101)                                    15,412.00      3,217.85    12,194.15       Other Contractural Services (2528)        115,333.33      87,048.38   28,284.95
Transportation of Things (2213)                     550.00            ---      550.00       Training Government (2535)                  3,000.00       4,995.00   (1,995.00)
Telephone and Communications Services (2329)        933.33        204.88       728.45       Supplies (2609)                             2,500.00         810.74     1,689.26
Messenger and Courier Services (2335)               150.00            ---      150.00       Other non-Cash Awards & Gifts (2614)        1,000.00         429.80       570.20
Commercial Printers (2403)                        1,000.00        301.67       698.33       Subscriptions and Publications (2639)         500.00         474.58        25.42
Advisory Assistance Services (2510)              16,666.67      2,239.67    14,427.00       Non-IT Equipment (3109)                     1,666.67          95.15     1,571.52
Training (2525)                                   8,666.67      6,074.64     2,592.02       IT Equipment (3140)                         5,850.00          33.98     5,816.03
Convenience Check Fees (2524)                           ---        62.20       (62.20)      Software (3143)                               600.00          90.02       509.98



                                                                                                                     3-Year Average   $172,478.67   $104,508.47    67,880.18
                 Farm Credit Administration
                 Office of Inspector General
                    Fiscal Year 2005-2006

  IMPACT ANALYSIS ON PRODUCTS AND SERVICES FROM A
       CHANGING BUDGET ENVIRONMENT, FY 2005
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 tp
incorporate more contract audit work.

A decrease in the OIG of 10 percent would eliminate to 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 ad the delivery of products and services.