oversight

March 2008

Published by the Farm Credit Administration, Office of Inspector General on 2008-03-01.

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

Office of
Inspector General
                    Semiannual Report to the Congress

                             October 1, 2007
                                 through
                             March 31, 2008


                                Number 38
                                April 2008
Farm Credit Administration                                Office of Inspector General
                                                          1501 Farm Credit Drive
                                                          McLean, VA 22102-5090
                                                          (703) 883-4030




April 14, 2008

The Honorable Nancy C. Pellett
Chairman of the Board
Farm Credit Administration
McLean, Virginia 22102

Dear Chairman Pellett:

Enclosed is the semiannual report on the activities of the Farm Credit Administration’s (FCA or
Agency) Office of Inspector General (OIG) for the period October 1, 2007 through March 31, 2008.
This is the thirty-eighth report since the establishment of the OIG on January 22, 1989.

I am submitting this report in accordance with the Inspector General Act of 1978, as amended (IG
Act). Section 5(b) of the IG Act requires that you send this report to the appropriate Congressional
committees and subcommittees within 30 days after the date of this transmittal, accompanied by
management’s report on the status of audit and/or inspection action items.

During this reporting period, the remaining agreed-upon action from the audit entitled Committees
Established by the FCA Board issued in January 2007 was closed by the OIG. We closed the
action item upon being notified that you feel the committees are operating satisfactorily and will no
longer seek the OIG’s concurrence that management has sufficiently complied with the agreed-upon
action. A further discussion of this is on page 6 of this report. Three agreed-upon actions were
closed and three agreed-upon actions remain open from the inspection report entitled FCA’s
Enforcement Program issued in July 2007.

I look forward to a continuing positive relationship between the OIG and your office, which I view as
a partnership, striving to strengthen FCA operations.

Respectfully,



Carl A. Clinefelter
Inspector General

Enclosure
                      TABLE OF CONTENTS
EXECUTIVE SUMMARY…………………………………………………………….………………. 1

BACKGROUND……………………………………………………………………………………… 1
  FARM CREDIT ADMINISTRATION………………………………………………………………… 1
  FAMR CREDIT SYSTEM…………………………………………………………………………… 2

MANAGEMENT CHALLENGES………………………………………………………….……….. 2
  FARM CREDIT ADMINISTRATION………………………………………………………………… 2
  AGENCY GOVERNANCE………………………………………………………………………….. 2
  STRATEGIC PLANNING……………………………………………………………………………. 3
  HUMAN CAPITAL………………………………………………………………………….……….. 3
  FINANCIAL MANAGEMENT…………………………………………………………………………4
  LEVERAGING TECHNOLOGY………………………………………………………………………4

AUDIT AND INSPECTION REPORTS ISSUED………………………………………………….. 4
  INDEPENDENT FINANCIAL AUDIT FOR FY 2007………………………………………………… 5
  FEDERAL INFORMATION SECURITY MANAGEMENT ACT (FISMA) REVIEW
     FOR FY 2007………………………………………………………………………………….. 5

AUDITS AND INSPECTIONS IN PROGRESS……………………………………………………. 5
  INDEPENDENT FINANCIAL AUDIT AND FISMA REVIEW FOR FY 2008…………………………. 5
  EFFICIENCIES REALIZED THROUGH OUTSOURCING………………………………………….. 5
  IT INFRASTRUCTURE PROJECT MANAGEMENT……………………………………………....... 6

STATUS OF UNIMPLEMENTED RECOMMENDATIONS………………………………………. 6
  AUDITS AND INSPECTIONS……………………………………………………………………….. 6

INVESTIGATIONS…………………………………………………………………………………… 7

LEGISLATION AND REGULATIONS……………………………………………………………… 7

OTHER ACTIVITIES…………………………………………………………………………………. 8
  COMPLIANCE – CONSOLIDATED APPROPRIATIONS ACT OF 2008…………………………. … 8
  PEER REVIEW OF OIG INVESTIGATIVE FUNCTION…………………………………………...... 9
  OIG OBSERVATIONS ISSUED…………………………………………………………………….. 9
  SURVEY OF FARM CREDIT SYSTEM INSTITUTIONS……………………………………………. 9
  STAFF PARTICIPATION IN ACTIVITIES OF THE PROFESSIONAL COMMUNITY……………….. 9
  STAFF PARTICIPATION IN AGENCY ORGANIZATIONS………………………………………… 10
  STAFF DEVELOPMENT…………………………………………………………………………… 10

ANNEX……………………………………………………………………………………………….. 11

APPENDICES
  APPENDIX A – INDEX OF REPORTING REQUIREMENTS………………………………………. 12
  APPENDIX B – AUDIT/INSPECTION REPORTS ISSUED………………………………………… 13
  APPENDIX C – REPORTS WITH QUESTIONED COSTS………………………………………… 13
  APPENDIX D – REPORTS WITH RECOMMENDATIONS THAT FUNDS
                 BE PUT TO BETTER USE……………………………………………………… 14
  APPENDIX E – FCA ORGANIZATIONAL CHART…………………………………………….…… 15
  APPENDIX F – OFFICE OF INSPECTOR GENERAL ORGANIZATIONAL CHART……………..... 16

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EXECUTIVE SUMMARY

        This Semiannual Report to the Congress summarizes the activities and
        accomplishments of the Farm Credit Administration’s (FCA or Agency) Office of
        Inspector General (OIG) for the period October 1, 2007 through March 31, 2008.
        The OIG’s efforts were directed toward operational and audit planning and
        performing audits, inspections, and evaluations of FCA programs and operations;
        conducting investigations, as necessary; independently and confidentially surveying
        Farm Credit System (FCS or System) institutions regarding the effectiveness of the
        Agency’s examiners and examination function; and providing objective, independent
        reporting and counsel to the Agency Chairman on FCA programs and operations.

        During this reporting period, the OIG volunteered for a peer review of our
        investigative function. It was conducted by the Office of Inspector General of the
        Securities and Exchange Commission. Their review determined our investigative
        function was in compliance with the President’s Council on Integrity and Efficiency
        (PCIE) and the Executive Council on Integrity and Efficiency (ECIE) guidelines. See
        page 9 for details.

        Also during this period, the independent financial audit of FCA for 2007 was
        concluded and two OIG initiated performance audits remained ongoing. No
        investigations were initiated.

        The OIG maintains five positions: the Inspector General (IG), a General Counsel, a
        Senior Auditor, a Senior Information Technology (IT) Auditor, and an Administrative
        Assistant. Appendix E and Appendix F display the organizational structure of FCA
        and the OIG, respectively.


BACKGROUND

Farm Credit Administration

        FCA is an independent Federal agency of the United States government responsible
        for the regulation and examination of FCS institutions chartered under the Farm
        Credit Act of 1971, as amended (Farm Credit Act). FCA is also a “designated
        Federal entity” within the meaning of the Inspector General Act of 1978, as amended
        (IG Act).

        As a non-appropriated agency, FCA funds its expenses primarily through
        assessments to the institutions it regulates. The Agency’s fiscal year (FY) 2008
        budget is $47,284,404. Assessments by FCA to FCS institutions for FY 2008



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         totaled $42,550,000, with other sources of funding totaling $4,734,404. The OIG’s
         FY 2008 budget is $1,017,558.

         At the end of this semiannual reporting period, FCA had 251 employees, about half
         of which are examiners located in five field offices. At the end of the prior
         semiannual reporting period, the Agency had 258 employees.

Farm Credit System

         The System is a lender to a single industry, agriculture, and is therefore vulnerable to
         economic swings in that industry. Nevertheless, the FCS remains sound in all
         material respects. Earnings and capital levels have continued to strengthen and
         asset quality remains high.

         However, there continue to be many issues facing agriculture and rural America
         today that have and will likely continue to raise the question of whether there should
         be modifications to the Farm Credit Act in order to enable the System to better serve
         agricultural and rural economies of the future.


MANAGEMENT CHALLENGES

Farm Credit Administration

         Whether or not there are modifications to the Farm Credit Act, the Agency should
         anticipate that the System will continue to seek broad regulatory interpretations.
         However, as a financial regulator, FCA must continue to maintain a flexible and
         responsive, yet independent and objective, regulatory environment for the System,
         geared to continually ensuring the FCS fulfills its public policy purpose. The
         Agency’s regulatory attention must also address other issues in the System such as
         scope of lending excesses and risks associated with exposure to new enterprises,
         such as alternative fuel production. Key to this for FCA is effective examination and
         regulation of System institutions by maintaining a properly staffed and resourced
         Agency.

Agency Governance

         The Farm Credit Act provides for a full-time three-member board to govern the
         Agency. FCA Board members are appointed by the President and confirmed by the
         Senate. The FCA Board has rules of operation that are a foundation for trust and
         shared expectations among its members, and intended to enable the FCA Board to
         engage in professional policy debate and set a sound course for the Agency.




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         However, a small full-time FCA Board presents a challenge in defining the roles and
         responsibilities of its members relative to the governance of the Agency. Periodic
         changes in the chairmanship and composition of the FCA Board also present both
         challenges and opportunities to the FCA Board’s governance of the Agency. This
         has been and will likely continue to be a challenge for the Agency’s Chairman.

Strategic Planning

         The FCA Board adopted the Strategic Plan for Fiscal Years 2004-2009, in
         December 2003. The Agency is required to revise its strategic plan at least every
         three years.

         In 2005, the FCA Board established a Strategic Planning Committee (SPC),
         comprised of Agency staff, to facilitate FCA Board input to the development of the
         strategic plan and to the planning process. The SPC has initiated strategic planning
         discussions between the FCA Board and management group and most recently
         posted on the Agency’s website a draft strategic plan for comment. Leadership of
         the SPC has indicated that a final draft strategic plan is expected to be provided to
         the FCA Board for consideration for approval in April 2008.

Human Capital

         In March 2001, the OIG recommended that FCA develop a human capital plan and
         FCA management agreed. Chairman Pellett assumed the chairmanship in May
         2004. In 2006, a 5-year strategic human capital plan was completed.

         FCA’s challenge is to continue to implement the human capital plan to ensure a
         workforce that enables the Agency to effectively regulate a constantly evolving FCS.
         In meeting this challenge, the Agency should continue to:

         •   address the attrition of seasoned staff by recruiting, training, and implementing
             succession planning, and by capturing, preserving, and transferring knowledge
             from departing employees; and
         •   address the ongoing viability of the examination staff, a critical component of the
             Agency’s regulatory capability, by ensuring continuity in the examination
             workforce, appropriate examiner skills, and ongoing credibility with System
             institutions. This will continue to necessitate careful examiner recruiting and
             training, maintaining a rigorous commissioning program, and organizing to
             promote effective work processes and the efficient utilization of the examiner
             workforce.




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Financial Management

        Timely, accurate, and useful financial information is essential for:

             •   making day-to-day decisions;
             •   managing the Agency’s operations more effectively;
             •   supporting results-oriented management approaches; and
             •   ensuring accountability on an ongoing basis.

        In April 2006, FCA outsourced the travel, financial management, and procurement
        functions to the Department of the Treasury’s Bureau of the Public Debt (BPD).
        Subsequent to the outsourcing, management determined that timely and efficient
        service in procurement was not occurring, and management brought procurement
        back within the Agency. To ensure the ongoing effectiveness of this outsourcing, the
        Agency will need to continually assess the cost-effectiveness of this outsourcing and
        BPD’s performance in providing timely service, useful financial reporting, and
        improved efficiencies to the Agency.

Leveraging Technology

        Information technology (IT) is a key element in management’s efforts to continually
        improve Agency performance. In this regard, the Agency is in the process of a
        major infrastructure transition designed to promote efficient work processes and
        provide staff with enhanced communication and collaboration tools. The ongoing
        challenge is to stay abreast of emerging technologies and maintain an effective IT
        infrastructure that provides FCA staff with IT tools and skills to operate in an efficient,
        effective, and secure manner. In addition, the Agency must ensure that it maintains
        technical staff with the current skills and knowledge to implement and maintain its
        infrastructure, and initiatives in this regard are underway.


AUDIT AND INSPECTION REPORTS ISSUED

        The OIG conducts all audits in accordance with Government Auditing Standards
        issued by the Comptroller General of the United States for audits of Federal
        organizations, programs, activities, and functions. Inspections are in accordance
        with PCIE Quality Standards for Inspections. Copies of most OIG reports are
        available on the FCA OIG web site www.fca.gov/home/inspector.html, or by
        contacting the OIG at (703) 883-4030, or by TTY at (703) 883-4359, or by e-mail at
        ig_information@fca.gov.




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Independent Financial Audit for FY 2007

        The Accountability of Tax Dollars Act of 2002 extended to FCA and certain other
        agencies a requirement to submit to the Congress and the Office of Management
        and Budget (OMB) an audited financial statement each fiscal year. Also, the
        President’s Management Agenda states agencies must continue to improve their
        financial performance by improving timeliness, enhancing usefulness, and ensuring
        reliability by obtaining and sustaining a clean audit opinion.

        In continuing to assist the Agency in meeting these requirements, the OIG
        contracted with the BPD for Brown & Company CPAs, PLLC (Brown & Co.) to
        perform the audit of FCA’s financial statements for FY 2007. The audit delivered an
        unqualified opinion and was issued November 5, 2007, meeting OMB’s reporting
        guideline.


Federal Information Security Management Act (FISMA) Review for FY
2007
        The OIG contracted with Harper, Rains, Knight & Company, P.A. (HRK) to perform
        an independent review of the Agency’s information security program’s compliance
        with FISMA for FY 2007. The evaluation was performed using guidelines
        established by FISMA, OMB Circular A-130, Government Accountability Office’s
        Federal Information System Controls Audit Manual, and the National Institute of
        Standards and Technology. HRK found no exceptions during the evaluation of
        FCA’s compliance with FISMA.


AUDITS AND INSPECTIONS IN PROGRESS

Independent Financial Audit and FISMA Review for FY 2008

        The OIG was notified by the BPD in February 2008 that it had awarded the contract
        to provide financial audit services to the FCA for 2008 to Brown & Co. The FISMA
        review for FY 2008 will be performed by the OIG’s Senior Information Technology
        Auditor versus by an outside contractor.

Efficiencies Realized Through Outsourcing

        An audit to determine whether the outsourcing of financial services to BPD improved
        Agency operations and reduced costs was completed. An exit conference was held
        with management on March 27, 2008. While the audit report is not yet final, the




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        audit determined that the outsourcing was positive in improving efficiencies and
        effectiveness in Agency financial management services.

IT Infrastructure Project Management

        An audit is underway to determine if FCA is using sound project management
        practices to minimize risks associated with making significant changes to the IT
        infrastructure. We will evaluate the effectiveness of project management and
        determine if the process complies with agency policy and best practices.


STATUS OF UNIMPLEMENTED RECOMMENDATIONS

        At the beginning of the reporting period, there was one unimplemented agreed-upon
        action from an audit. This item was closed without OIG concurrence. Also, at the
        beginning of the reporting period, there were six agreed-upon actions from an
        inspection. Three of these were closed during this period and three remain open. At
        the end of the period, three agreed-upon actions remain open.

Audits and Inspections

        The following table summarizes the status of action items from audits and
        inspections.

                Audit and Inspection Agreed-Upon Actions and Recommendations
                                                                    Final
                                                Open during
                                                                Management       Open on
         Audit Report                 Issued    this 6-month
                                                               Actions during   04/01/2008
                                                   period
                                                                 this period
        Committees Established
                                      1/26/07         1               1              0
          by the FCA Board
        FCA’s Enforcement
                                      7/31/07         6               3              3
          Program
                          Total                       7               4              3


        An audit report on Committees Established by the FCA Board was issued in January
        2007. Management agreed with the report’s two recommendations and they were
        converted to agreed-upon actions. During this reporting period, the OIG closed the
        remaining open agreed-upon action A-1 (The Chief Executive Officer should formally
        document the mission, authorities, responsibilities, performance expectations and
        duration of the Regulation and Policy Development, Risk, and Strategic Planning
        Committee.) from the audit. Even though management had originally agreed to this



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      action item in January 2007 and submitted documentation to the OIG on two
      occasions to close the action item, the OIG on both occasions indicated to
      management that the submissions were not adequate. On February 15, 2008, the
      FCA Board Chairman notified the OIG that in management’s view the committees
      are operating satisfactorily and OIG’s concurrence that management has sufficiently
      complied with this action item will no longer be pursued.

      This is a significant management decision with which the IG is in disagreement and
      is being reported here in accordance with Section 5(a)(12) of the IG Act.

      An inspection report on FCA’s Enforcement Program was issued on July 31, 2007.
      Management agreed with the report’s six recommendations and they were
      converted to agreed-upon actions. Three agreed-upon actions were closed and
      three remain open. However, management has partially complied with one of the
      three open action items.


INVESTIGATIONS

      OIG Hotline calls and e-mails dealing with borrower complaints concerning FCS
      institutions and other FCS issues were referred to the FCA office or other Federal
      agency responsible for reviewing such matters.

      No investigations are currently open.


LEGISLATION AND REGULATIONS

      In the furtherance of the OIG’s mandate to review existing and proposed legislation
      and regulations, the IG or Counsel to the IG attends joint briefings of the Board on
      regulations at the proposed and final stages. The following were reviewed by
      Counsel to the IG:

         Legislation

             1) S. 2324 – Inspector General Reform Act of 2007

             2) H.R. 928 – Improving Government Accountability Act

             3) S. 2488 – Openness Promotes Effectiveness in our National
                    Government Act of 2007 or The Open Government Act

             4) H.R. 2764 – (Public Law 110-161) Consolidated Appropriations Act of
                   2008 [Sec. 746] (See Other Activities below for details.)



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               5) H.R. 1585 – National Defense Authorization Act for 2008 (See Annex on
                     page 11 for details.)

               6) S. 2583 – Improper Payments Elimination and Recovery Act of 2008

               7) Executive Order: Protecting American Taxpayers from Government
                     Spending on Wasteful Earmarks

           Advanced Notice of Proposed Rulemaking

               8) FCA Capital Adequacy

               9) Farmer Mac Risk-Based Capital Stress Test Version 3.0

           Final Rule

              10) Annual Report to Shareholders

              11) Disclosure to Investors in Systemwide and Bank Consolidated Debt
                  Obligations of FCS

           Briefings

              12) Rural Community Investments

              13) Spring 2008 Unified Agenda


OTHER ACTIVITIES

Compliance – Consolidated Appropriations Act of 2008
       Section 746 of this statute requires that:

           a) Each executive department and agency shall establish and maintain on the
              homepage of its website, an obvious, direct link to the website of its
              respective Inspector General, and

           b) Each Office of the Inspector General shall:

                   1) post on its website any public report or audit issued within one day of
                      its release;

                   2) provide a service on its website to allow an individual to request
                      automatic receipt of information relating to any public report or audit



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                       or portion of that report or audit and which permits electronic
                       transmittal of the information, or notice of the availability of the
                       information without further request; and

                   3) establish and maintain a direct link on its website for individuals to
                      anonymously report waste, fraud and abuse.

        FCA and the OIG are in compliance with these requirements.


Peer Review of OIG Investigative Function

        The OIG volunteered for a quality assessment review of our investigative operations.
        The Securities and Exchange Commission’s Office of Inspector General conducted
        the review in December 2007 for the year ended September 30, 2007. Their review
        determined that “…the system of internal safeguards and management procedures
        for the investigation function of the FCA OIG for the year ended September 30,
        2007, are in full compliance with the quality standards established by the
        PCIE/ECIE. These safeguards and procedures provide reasonable assurance of
        conforming to professional standards in the conduct of investigations.”

OIG Observations Issued

        The OIG utilizes Observations to provide feedback to management on issues that
        come to our attention while performing other OIG work. OIG Observation Number
        08-01 was issued on January 30, 2008 relating to possibly reducing the outbreak of
        pandemic flu situations in the work place through the placement of hand sanitizers
        around the building as has been done in other Federal buildings.

Survey of Farm Credit System Institutions

        The OIG administers an ongoing survey of the regulated institutions of the FCS.
        The survey measures the quality and consistency of the Agency’s examination
        function. During this 6-month period, we sent surveys to the Audit Committee
        Chairman and CEO of 35 FCS institutions. The OIG issues a quarterly report to the
        Chief Examiner and to the Chairman and a summary report at the end of each fiscal
        year on the responses to surveys.


Staff Participation in Activities of the Professional Community

        OIG staff members are encouraged to take part in organizations that contribute to
        the mission of the Inspector General community, as well as their individual
        professional development. Most staff are actively involved in one or more
        professional organizations, as well as ad hoc activities of the PCIE/ECIE.


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        The IG continues to attend monthly meetings of all Inspectors General from the
        ECIE, meet monthly with Inspectors General from the other Federal financial
        regulatory agencies, participate as a member of the PCIE’s Inspection and
        Evaluation Committee, and is part of a PCIE/ECIE work group that meets regularly
        to plan for the transition within the Inspectors General community if the pending
        legislation addressing the Inspectors General community becomes law.

        The IG General Counsel meets at least monthly with counsels to the IGs. Counsel
        also attends Directors of Investigations meetings and participates with the IG on the
        legislation implementation planning work group.

        The OIG Senior Auditor and Senior IT Auditor attend Federal Audit Executive
        Committee meetings and conferences. The Senior IT Auditor also attends local
        Information Security and Control Association (ISACA) meetings and Federal
        information security and audit meetings.

Staff Participation in Agency Organizations

        Staff is active on several Agency workgroups and task forces. During this reporting
        period, the OIG was represented on the Administrative Burden Reduction
        Workgroup, Combined Federal Campaign, Infrastructure Review Pilot Work Group,
        and the FCA Employees’ Council.

Staff Development

        OIG employees continually seek ways to improve skills and become knowledgeable
        in inspector general community initiatives.




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ANNEX

        This annex is provided in accordance with the National Defense Authorization Act for
        FY 2008.

        This referenced statute requires all Inspectors General appointed under the IG Act to
        add an annex to their semiannual reports as follows:

           1) listing all contract audit reports issued during the reporting period containing
              significant audit findings;

           2) briefly describing the significant audit findings in the report; and

           3) specifying the amounts of costs identified in the report as unsupported,
              questioned, or disallowed.

        Significant audit findings are defined as unsupported, questioned, or disallowed
        costs in excess of $10,000,000, or other findings that the Inspector General
        determines to be significant. It defines contracts as a contract, an order placed
        under a task or delivery order contract, or a subcontract.

        No contract audit reports meeting these criteria were issued on behalf of the OIG
        during this reporting period.




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     APPENDIX A – INDEX OF REPORTING REQUIREMENTS


INSPECTOR GENERAL ACT CITATION AND REQUIREMENT                                                                PAGE

Section 4(a) (2)    Review of Legislation and Regulations ........................................................... 7

Section 5(a)(1)     Significant Problems, Abuses, and Deficiencies ......................................none

Section 5(a)(2)     Recommendations for Corrective Action .....................................................4-7

Section 5(a) (3)    Prior Recommendations Not Yet Implemented .............................................. 6

Section 5(a)(4)     Matters Referred to Prosecutive Authorities .............................................none

Section 5(a)(5)     Summary of Instances Where Information ...............................................none
                    Was Unreasonably Refused or Not Provided

Section 5(a) (6)    List of OIG Audit/Inspection Reports Issued During the Period ..................4-5

Section 5(a) (7)    Summary of Significant Reports Issued During the Period.........................4-5

Section 5(a) (8)    Statistical Table on Management Decisions................................................. 13
                    with Questioned Costs

Section 5(a) (9)    Statistical Table on Management Decisions on ........................................... 14
                    Recommendations that Funds be put to Better Use

Section 5(a) (10)   Summary of Each Audit Over Six Months Old for ...................................none
                    Which No Management Decision Has Been Made

Section 5(a)(11)    Significant Revised Management Decisions .................................................. 6

Section 5(a)(12)    Significant Management Decisions with Which ............................................. 6
                    the Inspector General Disagreed

Section 5(a) (13)   Compliance of Agency Financial Management System ................................ 5




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                                                                                        APPENDIX B


                                 Audit / Inspection Reports Issued


                                           Number of Agreed                          Recommendations
                                                                   Questioned
                                             Upon Actions/                           That Funds Be Put
                                                                     Costs
            Title of Report                Recommendations                             to Better Use

                              Total                  0                 $0                     $0



                                                                                           APPENDIX C


                                  Reports with Questioned Costs

                                                          Number                     Dollar Value

                                                             Recom-         Questioned     Unsupported
                                                 Reports
                                                            mendations        Costs           Costs


A. For which no management decision has
   been made by the commencement of
   the reporting period                             0              0            $0              $0

B. Which were issued during the reporting
   period                                           0              0            $0              $0

Subtotals (A+B)                                     0              0            $0              $0

C. For which a management decision was
   made during the reporting period                 0              0            $0              $0

    (i) dollar value of disallowed costs            0              0            $0              $0

    (ii) dollar value of costs not disallowed       0              0            $0              $0

D. For which no management decision has
   been made by the end of the reporting
                                                    0              0            $0              $0
   period

E. For which no management decision was
                                                    0              0            $0              $0
   made within six months of issuance




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                                                                                 APPENDIX D

              Reports with Recommendations that Funds be Put to Better Use

                                                                    Number of
                                                        Number of    Recom-
                                                         Reports    mendations      Dollar Value

A. For which no management decision has been
   made by the commencement of the reporting               0            0               $0
   period

B. Which were issued during the reporting period           0            0               $0

Subtotals (A + B)                                          0            0               $0

C. For which a management decision was made
                                                           0            0               $0
   during the reporting period

    (i) dollar value of recommendations that
                                                           0            0               $0
        were agreed to by management

        --based on proposed management action              0            0               $0

        --based on proposed legislative action             0            0               $0

    (ii) dollar value of recommendations that
                                                           0            0               $0
         were not agreed to by management

D. For which no management decision has been
                                                           0            0               $0
   made by the end of the reporting period

E. For which no management decision was made
                                                           0            0               $0
   within six months of issuance




                                                   14
         FCA   SE MI ANNU AL REPOR T TO THE C ONGRE SS
                      OCTOB ER 1 , 2 00 7—MARCH 3 1 , 2 00 8




APPENDIX E – FCA Organizational Chart




                    15
                             FCA     SE MI ANNU AL REPOR T TO THE C ONGRE SS
                                            OCTOB ER 1 , 2 00 7—MARCH 3 1 , 2 00 8




APPENDIX F – Office of Inspector General Organizational Chart




                                    Inspector General
                                     Carl A. Clinefelter

      Counsel to IG      Senior Auditor               Senior IT Auditor   Administrative Assistant
   Elizabeth M. Dean   Veronica G. McCain             Tammy F. Rapp          Debra M. Miller




                                             16
        R E P O R T
Fraud   |    Waste    |   Abuse    |   Mismanagement




        FARM CREDIT ADMINISTRATION
        OFFICE OF INSPECTOR GENERAL

   • Phone: Toll Free (800) 437-7322; (703) 883-4316

   • Fax:     (703) 883-4059

   • E-mail: fca-ig-hotline@rcn.com

   • Mail:    Farm Credit Administration
              Office of Inspector General
              1501 Farm Credit Drive
              McLean, VA 22102-5090