OFFICE OF INSPECTOR GENERAL Strategic and Operating Performance Plan Fiscal Years 2012-2013 Farm Credit Administration Farm Credit Administrration 15 5 01 Farm Creedit Drive MccLean, Virgin ia 22102-509 90 (703) 883-40000 August 22, 2011 The Honorable Lelan nd A. Strom, Chairman and Chief Exxecutive Offiicer The Honorable Kenn neth A. Spea arman, Board d Member The Honorable Jill Lo ong Thomps son, Board Member Farm Cre edit Adminisstration 1501 Farrm Credit Drrive McLean, Virginia 222102-5090 Dear Cha airman Strom m and FCA Board Memb bers Spearm man and Lon ng Thompso on: The enclosed docum ment is the Office of Insp pector Generral’s (OIG) Strategic and d Operating Performa ance Plan (S SOPP) and Budgets for fiscal years 2 012 and 20 013. The SOPPP includes the OIG’s au udit plan, a fluid docume ent that mayy be amende ed as the yea ar progress ses. Please call me if you u have any questions or comments. Sincerely y, Carl A. Clinefelter Inspector General Enclosurre TABLE OF CONTENTS Page Glossary of Terms............................................................................................................... 1 Introduction ......................................................................................................................... 2 Strategic and Operating Performance Plan ........................................................................ 4 Object Class Detailed Budget Overview ............................................................................. 12 FY 2012 – Revised Budget and Justifications ................................................................ 14 FY 2013 – Proposed Budget and Justifications ............................................................. 16 OIG Control System ............................................................................................................ 18 Audit Plan............................................................................................................................ 22 Appendices Appendix A—IRM Plan Summary Report ...................................................................... 25 Appendix B—FY 2012-2013 Products and Services Budget ......................................... 26 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 GLOSSARY OF TERMS Act Farm Credit Act of 1971, as amended Agency Farm Credit Administration CIGIE Council of the Inspectors General on Integrity and Efficiency CCIG Council of Counsels to Inspectors General FCA Farm Credit Administration FCA Board Farm Credit Administration Board FCS Farm Credit System FISMA Federal Information Security Management Act FLETC Federal Law Enforcement Training Center FTE Full-Time Equivalent FY Fiscal Year IDP Individual Development Plan IG Inspector General (FCA) IG Act Inspector General Act of 1978, as amended IRM Information Resources Plan IT Information Technology OE Office of Examination OIG Office of Inspector General (FCA) OMB Office of Management and Budget SOPP Strategic Operating and Performance Plan System Farm Credit System __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 1 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 INTRODUCTION The Farm Credit Administration (FCA or Agency) Office of Inspector General (OIG) was established on January 29, 1989, as a result of the 1988 amendments to the Inspector General Act of 1978, as amended (IG Act). The IG Act established specific responsibilities and authorities for all Federal Inspectors General. The FCA Inspector General (IG) has a dual reporting responsibility to both the FCA Board and the oversight committees of the Congress. The OIG analyzes Agency performance through audits, inspections, and evaluations and provides conclusions and recommendations designed to strengthen Agency effectiveness and efficiency. The OIG also reviews existing and proposed legislation and regulations relating to Agency programs and operations to assess the impact on the Agency’s economy and efficiency. The OIG contracts with an outside accounting firm for the annual audit of FCA’s financial statements, internal control over financial reporting, and compliance with laws and regulations relating to the determination of financial statement amounts. The accounting firm’s opinion letters and accompanying Agency financial statements and notes are included in the Agency’s annual Performance and Accountability Report. The OIG conducts the annual evaluation of the Agency’s compliance with the Federal Information Security Management Act (FISMA) and issues a report that is submitted to the Agency for further submission to the Office of Management and Budget (OMB). The OIG also maintains a Hotline for reporting allegations of fraud, waste, abuse, and mismanagement. When there are alleged administrative or criminal violations relating to Agency programs or personnel, the OIG will timely and effectively investigate and report. Further, the OIG conducts a quarterly confidential survey of Farm Credit System (FCS or System) institutions regarding the effectiveness of the Agency’s examination function and the examiners. The OIG issues a quarterly report and annual summary report on survey results to the Chief Examiner and the FCA Board. OIG’s FY 2012 Budget Request Section 6(f)(1) of the IG Act requires an Inspector General to highlight certain aspects of the Inspector General’s budget request to the head of the department or designated Federal entity to which the Inspector General reports. Section 6(f)(2) requires, in the case of FCA, the FCA Board to highlight the same aspects of the Inspector General’s budget request when transmitting the Agency’s budget to the President. For the Inspector General’s revised FY 2012 budget submission, the OIG’s budget information required to be highlighted is as follows: The aggregate budget request for the OIG is $1,144,346. __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 2 The amount needed for OIG training is $19,390 (tuition). The amount needed to support the Council of the Inspectors General on Integrity and Efficiency (CIGIE) is $3,000. __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 3 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 STRATEGIC AND OPERATING PERFORMANCE PLAN MISSION The OIG’s work products and presence will promote economy, efficiency, and integrity in Agency operations. CORE VALUES Integrity – Giving straightforward, objective and balanced advice, motivated by a desire to improve conditions and do what is right. Excellence – Producing high quality work and products that are timely and relevant. Knowledge – Acquiring and expanding relevant skills and expertise. Responsibility – Being accountable for our actions, work, and results and holding our customers to the same. CORE COMPETENCIES Teamwork – We combine our staff skills and outside expertise to accomplish our mission. Technology – We enhance the effectiveness of our work with the practical application of technology. Broad Vision – We use our FCA knowledge to focus efforts on significant issues within the Agency. Customer Centered – We are independent and believe we are successful when we have helped FCA become more successful. ASSUMPTIONS Changing work force. There will continue to be periodic changes in FCA’s Board composition and Agency organization, and ongoing changes in FCA staffing, e.g., new hires and retirements. The latter may result in the loss of corporate knowledge, e.g., that gained from the Agency’s regulatory experience during the agriculture crisis of the mid 1980s through the early 1990s and from regulatory evolution since that time. The FCS and the credit needs of rural America will continue to evolve and change. The financial and banking industry will become a different provider of financial services coming out of the current financial services industry crisis. As a result, the Agency’s methodology in achieving its mission will continually evolve and the OIG will need to remain vigilant over Agency performance and internal controls. Changing work environment. As FCA leverages technology to improve its processes, the OIG will have to be positioned to evaluate new risks in internal controls and security __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 4 measures. As a result, the OIG has ensured its expertise in technology to effectively perform the function. Limited budget resources. Budget pressures on the OIG will be equivalent to those faced by FCA as a whole. The OIG will have to use an efficient mix of its core competencies and external resources to fulfill its mission. Technology will continue to cause change in processes and our approach to work. Farm Credit Act. Changes in the agricultural and the financial industries will cause the FCS to seek greater flexibility in law and regulations. The OIG will continue to ensure that the FCA is ever mindful of its arm’s length regulatory role and mission to ensure the System’s service to rural America in a safe and sound manner, and will continue to review and may make recommendations regarding laws and regulations. PRODUCTS AND SERVICES, AND GOALS 1. Audit and evaluate the Agency’s programs and operations to promote economy, efficiency, and effectiveness. Deliver quality audit and inspection products and services that are useful to the Board, management, and the Congress. Provide technical advice and assistance to Agency officials in developing sound management information and financial reporting systems and in streamlining programs and operations. Continuously improve OIG staff, products, and internal office administration. 2. Investigate observed, alleged, or suspected wrongdoing to prevent and detect fraud, waste, abuse, and mismanagement in Agency programs and operations. Effectively investigate alleged administrative and criminal violations relating to FCA programs and personnel. Educate employees on their responsibility to report wrongdoing to the OIG. Provide relevant information on results of investigative activities to appropriate parties. 3. Review and make recommendations, as necessary, regarding existing and proposed legislation and regulations relating to Agency programs and operations and the Inspectors General community. Maintain an effective program for reviewing and commenting on proposed and existing legislation and regulations affecting the Agency. __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 5 4. Work with the Agency head (FCA Board) and Congress to improve program management, and with the Inspectors General community and other related organizations to address government-wide issues. Agency personnel understand and accept OIG’s role within FCA and the Inspectors General community. OIG staff provide leadership to organizations directly contributing to the Inspectors General community. OIG staff contribute to special projects for improving the Agency, the Inspectors General community, and the Federal government. __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 6 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 AUDITS AND EVALUATIONS OF AGENCY PROGRAMS AND OPERATIONS AGENCY GOALS 1 AND 2 OIG GOAL PERFORMANCE MEASURES OUTCOME 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 FCA Board, suggested by the FCA Board and management. FCA continues to receive unqualified financial management, and Congress. Risk is addressed. 100% of OIG audits are performed in audits. substantive Agency programs and activities and/or are Waste in Agency programs and operations is tied to the Agency strategic planning goals. reduced. Products are timely, i.e., average time to complete audits Agency compliance with laws, regulations, and and issue draft reports will not exceed 6 months. internal policies and procedures. Audits are constructive. Where audit products contain The Agency’s stature and reputation are recommendations to improve Agency operations, the maintained at a high level in the eyes of the Agency accepts at least 80% of the OIG audit Congress, the Administration, the FCS, FCA recommendations. employees and the public. FCA is more effective in carrying out its mission. The OIG is more effective in promoting economy, effectiveness, and efficiency within the Agency. ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 7 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 AUDITS AND EVALUATIONS OF AGENCY PROGRAMS AND OPERATIONS AGENCY GOALS 1 AND 2 OIG GOAL PERFORMANCE MEASURES OUTCOME 2. Provide technical advice and The IG advises the FCA Board concerning policy FCA continues to receive an unqualified assistance to Agency officials in direction or administrative priorities. financial audit. developing sound management OIG performs analysis and provides technical advice to OIG input and advice contributes to Agency information and financial reporting management concerning accounting, management decisions and actions that are more complete systems and in streamlining systems and controls, and performance measures. and valid. programs and operations. 3. Continuous improvement in OIG OIG training ensures the technical proficiency of staff. The OIG’s opportunity to facilitate positive staff, products, and internal office change within the Agency is enhanced by the OIG implements administrative improvements identified administration. quality and credibility of OIG products and through reviews of other Agency programs and through advice. staff involvement with the professional community. Peer review reports provide an unmodified opinion that OIG audit work meets or exceeds quality audit standards prescribed by the Government Accountability Office and CIGIE. ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 8 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 INVESTIGATIONS AGENCY GOALS 1 AND 2 OIG GOAL PERFORMANCE MEASURE OUTCOME 1. Effectively investigate alleged Investigative reports are timely and presented in an Administrative action, convictions, or pleas are administrative and criminal objective and factual manner. Memoranda are issued to obtained for employees and/or contractors violations relating to FCA management describing internal control weaknesses or found guilty of wrongdoing. programs and personnel. program deficiencies found during the investigative process Management actions taken against employees 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. Educate employees on their Allegations of wrongdoing are supported by specific Investigations are more successful because responsibility to report information as required by the OIG. they are initiated in a timelier manner and have wrongdoing to the OIG. better information. FCA employees are more willing to report real or suspected wrongdoing because they trust the competence, fairness, and confidentiality of OIG’s investigations. 3. Provide relevant information on Summaries of investigations and the resulting The FCA Board and the Congress are better results of investigative activities to administrative or judicial actions taken are incorporated into informed about OIG investigations, and appropriate parties. the Semiannual Report to the Congress, along with any administrative and judicial consequences. disagreements on the actions taken or failure of Public confidence in the integrity of FCA management to act in a timely and responsible fashion. programs and internal operations is Findings made during the investigative process concerning heightened. the problem at issue or systemic problems are recognized and corrected or mediated by management. ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 9 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 LEGISLATIVE AND REGULATORY REVIEW AGENCY GOALS 1 AND 2 OIG GOAL PERFORMANCE MEASURE OUTCOME 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. documents. Constructive comments on relevant documents are 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. ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 10 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 OUTREACH PROGRAM AGENCY GOALS 1 AND 2 OIG GOAL PERFORMANCE MEASURE OUTCOME 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 Inspectors General community at through better understanding. OIG programs Facilitate feedback from Agency employees and refine large. 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 provide 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 Inspectors General community. serving on committees and holding offices. Accountants, Institute of Internal Auditors, CIGIE, Council of Counsels to Inspectors General (CCIG), and Federal Law Enforcement Training Center (FLETC) are improved by OIG staff contributions and participation. The Inspectors General community is more credible and effective. 3. OIG staff contribute 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 Inspectors General community, special projects. and the Federal government. FCA programs and operations are more effective and efficient. ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 11 Detailed Budget Fiscal Years 2012 and 2013 SUB FTE 4.60 FTE 4.59 OBJECT CLASS OBJECT DESCRIPTION CLASS FY 2012 FY 2013 1100 Total Personnel Compensation 1111 Permanent Full-Time $503,196 $505,082 1139 Other than Permanent Full-Time $308,974 $308,974 1161 Overtime $0 $0 1171 Performance, Incentives and Other Awards $5,000 $5,000 Subtotal $817,170 $819,056 1200 Total Personnel Benefits 1213 TSP Match $22,395 $22,432 1217 Disability Insurance Contributions $3,249 $3,256 121B Wellness, Flex-care/Life Cycle Programs $6,500 $6,500 1299 Benefits Generated from Payroll $176,564 $184,040 1236 Public Transportation Initiatives $0 $0 1237 Student Loan Repayments $0 $0 1224 Relocation Payments Under Object Code 1200 $0 $0 Subtotal $208,708 $216,228 1300 Benefits Former Personnel 1302 Unemployment Compensation $0 $0 Subtotal $0 $0 2100 Travel and Transportation of Persons 2121 Local Travel $6,000 $6,000 2199 Temporary Duty Travel $7,105 $10,125 2151 Relocation Travel Expenses $0 $0 2152 Relocation House Hunting $0 $0 Subtotal $13,105 $16,125 2200 Transportation of Things 2211 Freight and Express Mail $0 $0 2212 Freight and Express Mail - Contract Mail Services $200 $200 2251 Transportation of Household Goods $0 $0 Subtotal $200 $200 2300 Rent, Communications, Utilities and Misc. Charges 2321 Rent/Lease - Space Lodging $2,000 $2,000 2331 Utilities - Other than Telephone and Comm. Svcs. $0 $0 2341 ADP Equipment and Software Rental $0 $0 2351 Telephone and Communication Services $680 $680 2354 Wireless Communication Services $764 $764 2371 Non-ADP Equipment Rental $0 $0 ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 12 Detailed Budget Fiscal Years 2012 and 2013 SUB FTE 4.60 FTE 4.59 OBJECT CLASS OBJECT DESCRIPTION CLASS FY 2012 FY 2013 Rent, Communications, Utilities and Misc. Charges 2382 Postage – USPS $0 $0 continued 2384 Postage Meter Rental $0 $0 2385 Messenger and Courier Services $0 $0 Subtotal $3,444 $3,444 2400 Printing and Reproduction 2411 U.S. Government Printing Office (GPO) $0 $0 2431 Commercial Printers/Photographers $1,000 $1,000 2451 Publications of Notices/Classified Advertising $0 $0 Subtotal $1,000 $1,000 2500 Other Contractual Services 2511 Consulting Services $75,000 $75,000 2524 Miscellaneous Services $1,074 $1,424 2528 Training - Commercial $11,765 $4,555 2531 Services of Other Government Agencies $3000 $3300 2538 Training - Government $7,625 $11,910 2541 Renovating Office Space $0 $0 2571 Operation/Maintenance - Non ADP Equipment $0 $0 2572 Operation/Maintenance - ADP Equipment/Software $0 $0 2591 Storage of Household Goods $0 $0 Subtotal $98,464 $96,189 2600 Supplies and Materials 2611 Supplies $1,085 $805 2612 Subscriptions, Publications and Training Materials $520 $1,120 2641 Fuel $0 $0 Subtotal $1,605 $1,925 3100 Equipment 3122 Non-IT Equipment, Furniture, Fixtures $0 $0 3152 Software $500 $500 3162 IT Equipment $150 $450 Subtotal $650 $950 4200 Insurance Claims and Indemnities 4211 Insurance Claims and Indemnities $0 $0 Subtotal $0 $0 TOTAL $1,144,346 $1,155,117 ____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 13 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2012 REVISED BUDGET AND JUSTIFICATIONS TOTAL OFFICE BUDGET .......................................................................................... $1,144,346 Total approved IRM Plan amount included in Office Budget......................................... $6,399 1100 Personnel Compensation ................................................................................... $817,170 Amount required to fund salaries ($812,170) of OIG staff (4.60 Full Time Employees [FTE]) charged with conducting audits, inspections, evaluations, and investigations related to Agency programs and operations. We are also responsible for reviewing existing and proposed legislation and regulations to evaluate their impact on the Agency. Funds ($5,000) are also allocated for possible cash awards. 1200 Personnel Benefits ............................................................................................. $208,708 Benefits are the direct result of salaries, consistent with employees’ retirement systems, health and other related benefits. 1300 Benefits for Former Personnel ..................................................................................... $0 2100 Travel and Transportation of Persons ................................................................ $13,105 OIG staff will use these funds for travel ($7,105) related to scheduled IDP training and local travel ($3,000) to professional association meetings, for example. Travel funds ($3,000) are also included for local and/or temporary duty travel related to possible investigative matters. 2200 Transportation of Things .......................................................................................... $200 The amount is for express mail services throughout the year. 2300 Rent, Communications, Utilities, and Miscellaneous .......................................... $3,444 2351 Approved IRM Plan ................................................................................................. $680 2354 Approved IRM Plan ................................................................................................. $764 These funds will cover Smartphone voice, data, and tethering services for the IG ($764), telecommuters’ access expense ($360), and maintenance of an independent internet account for the anonymous HOTLINE account ($320). The independent internet account is used for confidential reporting of fraud, waste, abuse, and mismanagement. Also, in this object class are funds for offsite meeting expenses ($2,000) for a possible one-day OIG team building exercise. 2400 Printing and Reproduction ..................................................................................... $1,000 Cost of printing brochures, pamphlets, business cards, etc. when FCA cannot produce the items. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 14 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2012 REVISED BUDGET AND JUSTIFICATIONS 2500 Other Contractual Services .................................................................................. $98,464 Tuition funds ($11,765) from non-government sources are for staff training. Government tuition funds ($7,625) are for staff training at Government sponsored sources. Individual training classes are a mandatory requirement of the Government Audit Standards (Yellow Book) for auditors and of the bar association for the Counsel to the IG. Membership fees ($1,074) will cover the dues for professional organizations to which OIG staff belong. Consulting services are utilized to assist OIG staff in the review of programs, including the FCA financial statement audit ($50,000) and possible general contracting needs ($25,000). Lastly, $3,000 is budgeted for the support of CIGIE. 2600 Supplies and Materials ........................................................................................... $1,605 2611 Approved IRM Plan ................................................................................................. $485 2612 Approved IRM Plan ................................................................................................. $220 To purchase miscellaneous reference books and training materials ($400), on-going subscriptions in the IRM Plan ($220), one laptop carrying case ($125), and two laptop batteries @$180 per battery ($360). General office supply funds ($500) are also included. 3100 Equipment .................................................................................................................. $650 3152 Approved IRM Plan ................................................................................................. $500 3162 Approved IRM Plan ................................................................................................. $150 Purchase desktop printer ($150) as necessary to support OIG programs, and an additional $500 for software. 4200 Insurance Claims and Indemnities ............................................................................... $0 _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 15 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2013 PROPOSED BUDGET AND JUSTIFICATIONS TOTAL OFFICE BUDGET .......................................................................................... $1,155,117 Total approved IRM Plan amount included in Office Budget....................................... $17,669 1100 Personnel Compensation ................................................................................... $819,056 Amount required to fund salaries ($814,056) of OIG staff (4.59 FTEs) charged with conducting audits, inspections, evaluations, and investigations related to Agency programs and operations. We are also responsible for reviewing existing and proposed legislation and regulations to evaluate their impact on the Agency. Funds ($5,000) are also allocated for possible cash awards. 1200 Personnel Benefits ............................................................................................. $216,228 Benefits are the direct result of salaries, consistent with employees’ retirement systems, health and other related benefits. 1300 Benefits for Former Personnel ..................................................................................... $0 2100 Travel and Transportation of Persons ................................................................ $16,125 OIG staff will use these funds for travel ($10,125) related to scheduled IDP training and local travel ($3,000) to professional association meetings, for example. Travel funds ($3,000) are also included for local and/or temporary duty travel related to possible investigative matters. 2200 Transportation of Things .......................................................................................... $200 The amount is for express mail services throughout the year. 2300 Rent, Communications, Utilities, and Miscellaneous .......................................... $3,444 2351 Approved IRM Plan ................................................................................................. $680 2354 Approved IRM Plan ................................................................................................. $764 These funds will cover Smartphone voice, data, and tethering services for the IG ($764), telecommuters’ access expense ($360), and maintenance of an independent internet account for the anonymous HOTLINE account ($320). The independent internet account is used for confidential reporting of fraud, waste, abuse, and mismanagement. Also, in this object class are funds for offsite meeting expenses ($2,000) for a possible one-day OIG team building exercise. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 16 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2013 PROPOSED BUDGET AND JUSTIFICATIONS 2400 Printing, Publications and Advertisement ............................................................ $1,000 Cost of printing brochures, pamphlets, business cards, etc. when FCA cannot produce the items. 2500 Other Contractual Services .................................................................................. $96,189 Tuition funds ($4,555) from non-government sources are for staff training. Government tuition funds ($11,910) are for staff training at Government sponsored sources. Individual training classes are a mandatory requirement of the Yellow Book for auditors and of the bar association for the Counsel to the IG. Membership fees ($1,424) will cover the dues for professional organizations to which OIG staff belong. Consulting services are utilized to assist OIG staff in the review of programs, including the FCA financial statement audit ($50,000) and possible general contracting needs ($25,000). Lastly, $3,300 is budgeted for the support of CIGIE. 2600 Supplies and Materials ........................................................................................... $1,925 2611 Approved IRM Plan ................................................................................................. $205 2612 Approved IRM Plan ................................................................................................. $220 To purchase miscellaneous reference books and training material ($1,000), on-going subscriptions in the IRM Plan ($220), one laptop battery ($180), and one Smartphone battery ($25). General office supply funds ($500) are also included. 3100 Equipment .................................................................................................................. $950 3152 Approved IRM Plan ................................................................................................. $500 3162 Approved IRM Plan ................................................................................................. $450 Purchase software as necessary to support OIG applications ($500) and replace desktop printer as needed ($150), and replace Smartphone device as needed ($300). 4200 Insurance Claims and Indemnities ............................................................................... $0 _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 17 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 OIG CONTROL SYSTEM STATUTORY ROLE AND RESPONSIBILITIES The OIG was created within the FCA by the 1988 amendments to the IG 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 FCA Board and the Congress fully informed about problems and deficiencies and the progress in correcting them. The IG Act specifies the IG’s duties, responsibilities, and authorities. The IG Act precludes the OIG from performing any Agency program operating function; rather, the OIG advises management and the Congress about ways to improve programs. The IG works with the FCA Board to promote positive change in the Agency’s programs and operations. OIG STAFFING NEEDED TO DELIVER 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. The IG is also an advisor to the FCA Board and the principal spokesperson for the OIG, coordinating its activities and issues with other agencies. The IG position is to be comparable in grade with the other office directors. This is staffed as a permanent full-time position. The Deputy Inspector General and Counsel to the Inspector General provides independent legal advice, analysis of proposed legislation and regulations, and reviews OIG products for legal sufficiency. The Counsel represents and defends OIG in all legal issues. The Counsel also participates in inspections and evaluations as necessary. The Counsel directs the investigative function. The Counsel position is currently staffed as a permanent part-time position at a 0.80 FTE. The Senior Auditor position is devoted primarily to performance audits, inspections, and management analyses, focusing on the significant management challenges of the Agency. Also, this position oversees the contractor performing the annual financial, internal control, and compliance audit of the Agency on behalf of the OIG. This is staffed as a permanent full-time position. A Senior Information Technology (IT) Auditor position was created with the discontinuance of the Criminal Investigator position. This position focuses on audits and inspections related to the broad range of the Agency’s IT policies, processes, and security, and also performs the annual FISMA review. This position is currently staffed as a permanent part-time position at 0.80 FTE. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 18 The Administrative Assistant is responsible for assisting the IG in budgeting, information resources planning, procurement, training, administrative matters relating to personnel management, and for general administrative support to the rest of the staff. The position is also responsible for assisting the IG in the completion of the Semiannual Report to the Congress and the quarterly and annual reports on the OIG Survey of FCS institutions regarding the Agency’s examination function. This is staffed as a permanent full-time position. All positions in the OIG are staffed with well qualified personnel. OIG PRODUCTS AND SERVICES Audits 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. The OIG also provides input to the FCA Board or managers through management letters and confidential Observations. The auditors are devoted full time to audits and inspections. The Counsel to the IG may also perform inspections and evaluations focusing on evaluating administrative and operational issues. The OIG augments its core staff with contractors when 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 in that they are normally directed at individuals rather than programs and activities. However, some of the 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. The OIG also manages a HOTLINE to enable FCA employees and the public to more easily report wrongdoing. Legislative and Regulatory Review includes the review and comment on proposed and existing legislation and regulations as they may affect the Agency. This review activity is reported in the Semiannual Report to the Congress. Outreach directs the OIG to focus attention to improving the Agency, the Inspectors General community, and the public’s awareness of the FCA OIG’s role. This is accomplished by promoting Agency understanding of the OIG’s role, providing leadership to organizations contributing to the IG community, and by participating in special projects. The OIG also develops educational information describing the roles and activities of the OIG and provides information to the public through the OIG web site. Other OIG Functions include internal policy direction and leadership and advice to the Chairman and management about Agency programs and operations. The IG is also responsible for fully informing the FCA Board and the Congress about fraud and other serious problems in Agency programs, including management’s progress in carrying out corrective actions. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 19 OIG’S MISSION AND IMPLICATIONS FOR STAFFING It is the OIG’s mission that its work products and presence promote economy, efficiency, and integrity in Agency operations. The OIG will accomplish this by being a leader and catalyst identifying Agency challenges and opportunities. We will 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 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. In that way, management will be receptive to our conclusions and recommendations. Staff must be supported through OIG management’s actions, equipment and training, and mutual support from office teammates. STAFFING ASSESSMENT AND STRATEGIES OIG’s diverse responsibilities prescribed by the IG Act dictate the needed competencies within the OIG staff. The independent nature of the OIG 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 4.60 FTEs in this plan constitute the critical mass necessary to credibly perform OIG’s responsibilities. The OIG established the current staffing pattern after careful analysis of the specialized nature of the OIG’s responsibilities and volume of work. Downsizing over the years has reduced the OIG to a level at which any further reduction may adversely affect the OIG’s accomplishment of its mission. OIG staff performs evaluations and investigations under the general supervision of the IG. These assignments are often unlike previous assignments and need creative thinking in planning and developing the project, and mature judgment in developing conclusions and recommendations and defending them before management. The current OIG staff profile represents a high level of diversity. When filling future OIG vacancies, we will make a concerted effort to attract 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. STAFFING OBJECTIVES AND STRATEGIES Objectives Retain and refine the skills and competencies represented by the current staff profile. Employ the best-qualified applicant while ensuring the broadest possible pool of applicants. Increase effectiveness of collaboration among OIG staff members. Expand OIG staff participation in non-program activities of the Agency. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 20 Strategies 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. Agency affirmative employment objectives will be considered in filling all OIG vacancies to achieve appropriate diversity. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 21 Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 AUDIT PLAN AUDITS, INSPECTIONS, AND EVALUATIONS – FISCAL YEAR 2012 AND 2013 This audit plan identifies potential audit, inspection, and evaluation areas. This plan was discussed with the FCA Board to afford the FCA Board the opportunity to comment and offer suggestions for additional audit, inspection, and evaluation areas. OIG audits, inspections, and evaluations provide assurance to the FCA Board that programs are operating effectively with appropriate controls. Audit, inspection, and evaluation activities will most likely be selected from the areas listed below. However, actual audits, inspections, and evaluations conducted may vary in order to be responsive to changing needs or circumstances. Annual Audits and Evaluations Audit of FCA’s Financial Statement The OIG contracts with an independent accounting firm to conduct an audit of FCA’s financial statement, internal control over financial reporting, and compliance with laws and regulations relating to the determination of financial statement amounts. The OIG will deliver an audit opinion as of September 30, 2012 and 2013 respectively. The OIG has ensured that its independent accounting firm has incorporated in its audit plan a work schedule that will provide an appropriate audit scope and deliverables within appropriate time frames. Federal Information Security Management Act (FISMA) Evaluations FISMA requires the agency program officials, Chief Information Officers and Inspectors General to conduct annual evaluations of their respective department’s or agency’s information security program and report the results to OMB. For FYs 2012 and 2013, the OIG Senior Information Technology (IT) Auditor will conduct the FISMA evaluation at FCA. FY 2012 Evaluation of OE Training & Commissioning Program (Audit) The knowledge and skill level required to conduct sound examination and effective supervision of System institutions needs to continually develop to keep pace with the changing financial marketplace. We will review the adequacy of OE’s training and commissioning program in equipping OE’s staff with the knowledge and skills needed to examine and supervise the myriad of business practices and conditions found in System institutions. Information Technology Investments Performance Measures (Inspection) The Agency has made significant IT investments such as Live Meeting, Microsoft Communicator, and High Definition videoconferencing. As the Agency continues to invest in technology to improve operations, measures need to be in place to ensure these investments _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 22 are being fully utilized and projected benefits realized. We will determine whether the Agency has developed effective performance measures to capture the benefit of IT investments. Travel Expenses (Survey) OIG will conduct a survey of FCA employees’ travel expenses to determine whether further evaluation of controls, efficiencies, or savings may be realized. FY 2013 Human Capital (Audit) An effective human capital program is essential to ensure the Agency has the right people with the right skills to accomplish its mission. The objective of this audit will be to assess the adequacy of the Agency’s human capital plan and the effectiveness of its implementation. This includes an evaluation of Agency effectiveness in hiring and developing staff and of the continuity of leadership within the Agency. General Control Review: Access Controls (Audit) Access controls are necessary to prevent authorized modifications, disclosure, or loss of data. We will evaluate access controls at FCA to ensure they provide reasonable assurance that computer resources are protected against unauthorized access. Inappropriate Use of Agency IT Resources (Inspection) There has been increasing concern regarding Federal employees’ use of government equipment and official time to view inappropriate internet sites. Viewing and downloading from inappropriate web sites with an Agency computer could result in a significant misuse of official Agency resources, loss of productivity, and a potentially hostile work environment. In addition, there is a security risk for the Agency due to malware commonly found on such websites. We will assess FCA’s controls to prevent and detect use of Agency computers to view and download inappropriate material from the internet. Teleworking Program (Audit) Telework is a work arrangement in which an employee performs their official duties at home or other worksites geographically convenient to the employee’s residence. On December 9, 2010, the President signed into law H.R. 1722, the “Telework Enhancement Act of 2010,” which became Public Law 111‐292, aimed at increasing telework in the Federal government. As a human capital initiative FCA offers a telework program that provides employees the opportunity to perform their official duties at an alternate worksite, such as their home. Telework offers numerous benefits including reducing traffic congestion, improving the quality of work life and morale, and offering continuing operation during emergency events. The objective of this audit will be to determine whether the Agency’s telework program is being effectively administered. _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 23 Beyond FY 2013 FCA Strategic Plan Review of OE Organizational Structure and Work Processes Controls for Safeguarding Personally Identifiable Information, including Social Security Numbers Review of the Consolidated Reporting System General Control Reviews: Software Development and Change Control General Control Reviews: System Software General Control Reviews: Segregation of Duties Efficiency of the Office of the General Counsel Legal Opinion Process Specialization and Certification Property Plant and Equipment Review Delegations _________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 24 APPENDIX A Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 IRM PLAN SUMMARY Object FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 IRM Budget Category Total Costs Code Costs Costs Costs Costs Costs Telecommunications Rentals 2351 680 680 680 680 680 3,400 Wireless Communications 2354 764 764 764 764 764 3,820 Supplies 2611 485 205 485 205 485 1,865 Subscriptions and Publications 2612 220 220 220 220 220 1,100 Software 3152 500 500 500 500 500 2,500 IT Equipment 3162 150 450 150 450 150 1,350 Sub Total 2,799 2,819 2,799 2,819 2,799 14,035 Manpower Costs for three IRM Projects 3,600 14,850 5,850 5,850 5,850 36,000 Total 6,399 17,669 8,649 8,669 8,649 50,035 _____________________________________________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 25 APPENDIX B Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2012 REVISED PRODUCTS AND SERVICES BUDGET This represents the allocation of budget dollars and FTEs to OIG’s products and services. Management, administrative support and leave are disbursed across the four products and services. Products/Services Budget % Budget FTE % FTE Audits, Inspections, and Review Products $926,920 81% 3.7 81% Investigations $22,887 2% 0.1 2% Legislation and Regulations Review $22,887 2% 0.1 2% Outreach $171,652 15% 0.7 15% Total $1,144,346 100% 4.60 100% Audits, Inspections, and Review Products—The OIG issues approximately 5-10 reports per year (including the annual FCA financial audit and FISMA review). This includes recommendations to Agency officials regarding improving the efficiency of Agency programs and mission achievement. It also includes four survey reports regarding System institutions’ ratings and comments about the Agency’s examination function. Budget for FY 2012—$926,920...................................................................................... 3.7 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 complaint or inquiry issues to Agency components are additional functions of the investigative service. Budget for FY 2012—$22,887....................................................................................... 0.1 FTE Review and Comment on Proposed and Existing Legislation and Regulations—The OIG reviews and comments on proposed and existing legislation and regulations affecting the Agency and the IG community. Additionally, the OIG reviews, comments and responds to Congressional and executive requests and inquiries. Budget for FY 2012—$22,887...................................................................................... . 0.1 FTE Outreach Program—The OIG educates FCA 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 and the OIG community. This includes but is not limited to: the Semiannual Report to the Congress, participation in external activities such as membership on CIGIE and the CCIG, and instructing at FLETC and various public and Government forums. We also participate in Agency efforts, such as the Employee’s Council, Administrative Workgroup, and Continuity of Operations Plan. Budget for FY 2012—$171,652..................................................................................... .0.7 FTE __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 26 APPENDIX B Farm Credit Administration Office of Inspector General Fiscal Years 2012-2013 FY 2013 PROPOSED PRODUCTS AND SERVICES BUDGET This represents the allocation of budget dollars and FTEs to OIG’s products and services. Management, administrative support and leave are disbursed across the four products and services areas. Products/Services Budget % Budget FTE % FTE Audits, Inspections, and Review Products $935,645 81% 3.7 81% Investigations $23,102 2% 0.1 2% Legislation and Regulations Review $23,102 2% 0.1 2% Outreach $173,268 15% 0.7 15% Total $1,155,117 100% 4.60 100% Audits, Inspections, and Review Products—The OIG issues approximately 5-10 reports per year (including the annual FCA financial audit and FISMA review). This includes recommendations to Agency officials regarding improving the efficiency of Agency programs and mission achievement. It also includes four survey reports regarding System institutions’ ratings and comments about the Agency’s examination function. Budget for FY 2013—$935,645...................................................................................... 3.7 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 complaint or inquiry issues to Agency components are additional functions of the investigative service. Budget for FY 2013—$23,102...................................................................................... . 0.1 FTE Review and Comment on Proposed and Existing Legislations and Regulations—The OIG reviews and comments on proposed and existing legislation and regulations affecting the Agency and the IG community. Additionally, the OIG reviews, comments and responds to Congressional and executive requests and inquiries. Budget for FY 2013—$23,102....................................................................................... 0.1 FTE Outreach Program—The OIG educates FCA 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 and the OIG community. This includes but is not limited to: the Semiannual Report to the Congress, participation in external activities such as membership on CIGIE and the CCIG, and instructing at FLETC and various public and Government forums. We also participate in Agency efforts, such as the Employee’s Council, Administrative Workgroup, and Continuity of Operations Plan. Budget for FY 2013—$173,268...................................................................................... 0.7 FTE __________________________________________________________________________________________________________ FCA OIG Strategic and Operating Performance Plan FY 2012-2013 27
FY 2012-2013
Published by the Farm Credit Administration, Office of Inspector General on 2011-08-22.
Below is a raw (and likely hideous) rendition of the original report. (PDF)