oversight

Travel Card Program

Published by the Farm Credit Administration, Office of Inspector General on 2014-08-19.

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

OFFICE OF
INSPECTOR GENERAL	       Audit Report
                     Farm Credit Administration’s
                         Travel Card Program

                               A-14-03

                          Auditor-in-Charge
                            Sonya Cerne
                       Issued August 19, 2014




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




     
     
     
    August 19, 2014 
     
    The Honorable Jill Long Thompson, Board Chair  
    The Honorable Kenneth A. Spearman, Board Member 
    The Honorable Leland A. Strom, Board Member  
    Farm Credit Administration 
    1501 Farm Credit Drive 
    McLean, Virginia  22102‐5090 
       
    Dear Board Chair Long Thompson and FCA Board Members Spearman and Strom: 
     
    The Office of Inspector General (OIG) completed an audit of the FCA’s Travel Card Program.  
    The objective of this audit was to determine whether FCA’s oversight of the travel card 
    program is effective.   
     
    During our review, we found that FCA’s oversight is generally effective.  FCA established 
    and implemented controls over the travel cards.  FCA conducted reviews of travel 
    transactions, distributed delinquency reports to management, and placed reasonable 
    spending limitations on the travel cards.    
     
    We would like to highlight the responsive actions Office of Management Services (OMS) 
    plans to take to address the issues identified during the audit.  OMS agreed to the 
    following actions to improve the travel card program: 
 
          1.	 Provide education to cardholders, at least annually, regarding agency policies on 
              cash withdrawals, personal use, procedures for when a credit is on an account, 
              charging expenses related to other individuals, and mandatory use of the travel 
              card for official travel.  
               
          2.	 Determine a process to distribute quarterly transaction activity reports such that 
              appropriate managers have the information and require a response on whether 
              any transactions need further review.  

          3.	 Document procedures on placing or removing an account in restricted status and 
              changes to travel card limits.  
          4.	 Incorporate and document a reconciliation of open status accounts on a 
              quarterly basis to ensure accounts of departed employees are closed.  

          5.	 Evaluate the sufficiency of existing check out procedures to ensure travel cards 
              are closed as employees depart and update the Charge Card Management Plan 
              to correspond with procedures. 

          6.	 Update PPM 711 to include steps to be initiated regarding delinquent accounts 
              and potential disciplinary actions, including dismissal, resulting from illegal, 
              improper, and erroneous purchases. 

          7.	 Update PPM 826 to include: disciplinary and adverse action steps related to 
              illegal, improper, and erroneous travel card purchases; account delinquency 
              actions; and, definitions of travel card misuse. 

          8.	 Update the Charge Card Management Plan to correspond with PPM 711 on cash 
              advances and delinquency notifications.  
     
    We appreciate the courtesies and professionalism extended to OIG staff by FCA personnel.  
    If you have any questions about this audit, I would be pleased to meet with you at your 
    convenience. 
     
    Respectfully, 


                                                
    Elizabeth M. Dean
 
    Inspector General
 
     
    Enclosure 
OBJECTIVE:
To determine whether FCA’s
oversight of the travel card
program is effective.
                                 During our review, we found that the Farm Credit Administration’s (FCA) oversight
BACKGROUND:                      is generally effective. FCA established and implemented controls over the travel
FCA participates in the          card program. Specifically, FCA placed a reasonable spending limitation, generally
government-wide General          $8,000, on travel cards and lowered limitations on cards with little to no activity.
Services Administration’s        We also found FCA performs monthly audits on travel transactions and distributes
(GSA) SmartPay Travel Card       monthly delinquency reports to management documenting overdue accounts.
Program and currently
contracts with the Bureau of     Additional changes will improve the travel card program. During our review, we
the Fiscal Service (BFS) for     found unauthorized transactions on 16 employees’ government travel cards. We
travel administration and        identified areas needing improvement in account management and the need to
services. BFS uses Citibank      strengthen policies and procedures. Specifically:
as the contractor under the
GSA Master Contract. OMS             •	 48 of the 347 transactions reviewed contained unauthorized transactions
is responsible for the overall          that included: cash advances outside authorized timeframes, expenses
administration of the travel            charged outside of official travel, and improper hotel charges. We also
card programs at FCA.                   identified one employee who had not used a government travel card for
                                        official travel, as required.
The Government Charge
Card Abuse Prevention Act            •	 Travel card account management can be improved. Two employees
of 2012 and the Office of               identified as having restricted accounts did not have lower limits on their
Management and Budget’s                 travel cards as directed in FCA policy. We noted 27 instances of delinquent
Memorandum M-13-21,                     accounts that went into presuspension status and 4 accounts with a
Implementation of the                   suspension status due to nonpayment. We also found two employees who
Government Charge Card                  left FCA and yet remained on the open status report for travel cards.
Abuse Prevention Act of
2012, mandated that each             •	 FCA’s policies and procedures should be updated. FCA’s policies on travel
Inspector General perform,              cards and disciplinary and adverse actions do not identify consequences,
at least annually, an                   including removal in appropriate circumstances, following an employee’s
assessment of charge card               failure to comply with applicable travel charge card terms and conditions
programs. Therefore, we                 and applicable agency regulations. Further, there are inconsistencies
completed a risk assessment             between the Charge Card Management Plan and other FCA policies and
and initiated this audit as             procedures.
part of our ongoing efforts
in this area.                    There are eight agreed-upon actions to improve oversight of the travel card
                                 program. The Office of Management Services (OMS) agreed with the report and
                                 provided specific tasks to be completed to strengthen FCA’s travel card program.
                                    Table of Contents



BACKGROUND ______________________________________________________________________ 1


 Prior OIG Inspection ________________________________________________________________ 2


OBJECTIVE, SCOPE, AND METHODOLOGY _________________________________________________ 2


AUDIT RESULTS ______________________________________________________________________ 4


 Transactional Review _______________________________________________________________ 4


 Agreed-Upon Actions 1-2 ____________________________________________________________ 6


 Account Management_______________________________________________________________ 6


 Agreed-Upon Actions 3-5 ____________________________________________________________ 8


 Policies and Procedures _____________________________________________________________ 8


 Agreed-Upon Actions 6-8 ____________________________________________________________ 9


ACRONYMS ________________________________________________________________________ 10

BACKGROUND

    The Farm Credit Administration (FCA) participates in the General Services Administration’s (GSA)
    SmartPay Program and uses charge card programs for official purchases related to the mission of the
    organization. FCA currently uses three charge card programs: purchase, travel, and fleet. Purchase
    card programs provide cards to Federal employees to make official Government purchases for supplies,
    goods, and services under the micro-purchase threshold of $3,000. Cardholders can purchase any
    commercially available supply or service within the spending limits and not prohibited by either Federal
    or agency-specific procurement regulations. Travel cards are used only for official travel and travel-
    related expenses to include transportation, lodging, meals, and incidentals. Fleet cards are used for fuel,
    maintenance and repair of government owned/operated motor vehicles, aircraft, boats, and motorized
    equipment.

    For travel, FCA participates in the government-wide GSA SmartPay Travel Card Program and currently
    contracts with the Bureau of the Fiscal Service (BFS) for travel administration and services. BFS uses
    Citibank as the contractor under the GSA Master
    Contract. FCA’s travel card program includes two
    types of charge accounts for travel: individually-
    billed accounts and the centrally-billed account. For
    the individually-billed accounts, each designated
    cardholder is responsible for account payments. For
    the centrally-billed account, travel expenses are paid
    by the agency directly. FCA’s Office of Management
    Services (OMS) is responsible for the overall
    administration of the charge card programs and
    management of the centrally-billed account. For
    purposes of this report, we refer to the official government travel card as “travel card.”

    Each government agency must adhere to the requirements set forth in the Office of Management and
    Budget (OMB) Circular A-123, Appendix B, Improving the Management of Government Charge Card
    Programs. The circular stipulates that agencies must develop and maintain written policies and
    procedures related to charge card programs. This includes an annual submission of the agency’s Charge
    Card Management Plan that outlines the agency’s system of internal controls over the charge card
    programs. In addition, the Government Charge Card Abuse Prevention Act of 2012 (Charge Card Act)
    supplemented OMB Circular A-123, Appendix B with reporting and audit requirements and
    augmentation of existing controls. The Charge Card Act and OMB Memorandum M-13-21,
    Implementation of the Government Charge Card Abuse Prevention Act of 2012, also mandated that each
    Inspector General perform, at least annually, an assessment of charge card programs 1. Therefore, the
    Office of Inspector General completed a risk assessment and initiated this audit as part of our ongoing
    efforts in this area.



    1
     FCA does not meet the threshold for a required travel audit set forth in the Charge Card Act. However, the
    Charge Card Act did not establish a threshold for purchase card programs; therefore, Inspector Generals must
    perform an annual assessment of purchase cards. As part of our ongoing efforts, the FCA OIG performed an
    assessment of all charge card programs.



                                                            1
     Prior OIG Inspection

     The Office of Inspector General previously performed an inspection, Distribution, Usage and Control of
     Purchase and Travel Cards at the Farm Credit Administration (I-09-01). The objective was to determine
     the effectiveness and efficiency of the implementation of government purchase and travel cards at FCA.
     For travel cards, the inspection found that FCA had adequate controls over the program and there were
     no delinquencies over 60 days. However, the inspection found that FCA needed to improve the travel
     card program. During our review of the previous inspection’s resolution process, we found that FCA
     addressed the findings within the travel card program. The following chart shows the inspection
     findings and actions taken:


                                                               PPM 711 addresses steps
                           FCA's policy on
                                                                    taken to assess
                       government travel cards,
                                                                 creditworthiness and
                        PPM 711, needed to be
                                                                documents the role of
                              updated.
                                                                   BFS and Citibank.



                        Travel reports were not                    OMS distributes
                            issued to Office                   quarterly activity reports
                               Directors.                        to Office Directors.



                                                               FCA reviews accounts for
                        No restrictive limitations
                                                                little to no activity and
                           were set for travel
                                                                 reduces the spending
                        cardholders with limited
                                                                  limitations on those
                          to no travel activity.
                                                                        accounts.




OBJECTIVE, SCOPE, AND METHODOLOGY

     The objective of this audit was to determine whether FCA’s oversight of the travel card program is
     effective. We conducted field work at FCA’s headquarters in McLean, VA from May through July 2014.
     We limited our scope to Fiscal Year 2013 and the October - April months of Fiscal Year 2014.

     We completed the following steps to accomplish the objective:

        •   Reviewed applicable laws and regulations and relevant guidance related to charge card
            programs and travel.

        •   Reviewed FCA policies and procedures related to charge card programs.




                                                       2
   •	 Obtained background information for the GSA SmartPay programs.

   •	 Interviewed FCA officials on internal policies and procedures.

   •	 Requested and reviewed the listing of all active travel card accounts and limitations as of May
      2014.

   •	 Analyzed FCA’s travel card transactions for compliance with laws, regulations and FCA policies
      and procedures. We judgmentally sampled 347 transactions based on: activity, type, location,
      and number of charges; cash withdrawal periods; and travel timeframes. Because our sample
      was judgmental and not statistically sampled, we cannot project our findings to the entire
      population.

   •	 Interviewed selected employees about sampled transactions.

   •	 Reviewed travel authorizations, vouchers, and documentation in Govtrip and Concur Travel
      Systems. For the period reviewed, FCA used Govtrip as the travel system for Fiscal Year 2013
      and October-March of Fiscal Year 2014 and Concur since April 2014.

   •	 Reviewed and analyzed delinquency reports for accounts in past due, presuspension, or

      suspension status.


This audit was performed in accordance with Generally Accepted Government Auditing Standards.
Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence
to provide a reasonable basis for our findings and conclusions based on our audit objective. We
assessed internal controls and compliance with laws and regulations to the extent necessary to satisfy
the objective. Our review would not necessarily have disclosed all internal control deficiencies that
may have existed at the time of our audit. We assessed the computer-processed data relevant to our
audit objective and determined that the data was sufficiently reliable. Overall, we believe the evidence
obtained provides a reasonable basis for our conclusions based on our audit objective.




                                                   3

AUDIT RESULTS

     During our review, we found that FCA’s oversight is generally effective. FCA established and
     implemented controls over the travel card program. Specifically, FCA placed a reasonable spending
     limitation on travel cards. In general, FCA had placed an $8,000 limit on travel cards, with the exception
     of two board members. FCA also lowered limits on cards with little to no activity. We found no
     instances of employees taking cash advances in excess of the authorized daily and weekly amounts. We
     also found FCA performed monthly audits on travel transactions. An OMS official reviews 10 percent of
     randomly selected employees’ travel transactions each month for misuse, cash withdrawals, and
     verification of authorizations. Monthly delinquency reports are distributed to management
     documenting overdue accounts. Lastly, we found established and effective controls, practices and
     procedures in place related to the travel centrally-billed account.

     However, additional changes will improve the travel card program. We found unauthorized transactions
     on employees’ travel cards. FCA can also strengthen account management and policies and procedures.

                                           Transactional Review

     For the audit, we reviewed FCA’s travel activity for Fiscal Year 2013 and the October through April
     months of Fiscal Year 2014. We judgmentally sampled 347 transactions for further review. From our
     judgmental sample, we found that 48 of the 347 transactions sampled contained unauthorized
     transactions that included: cash advances outside authorized timeframes, expenses charged outside of
     official travel, and improper hotel charges. We also identified one employee who had not used a
     government travel card for official travel, as required.

     We identified 4 employees that had taken 10 cash advances outside the                       Daily
     authorized timeframe. The cash advances totaled about $1,800, with one                   Limitation:
     employee accounting for about $1,300 of the $1,800. FCA’s policies on                       $210
     government travel cards state that employees may obtain cash advances for
     official travel related expenses through an automated teller machine up to $210
     per day and $1,050 per week. Employees can withdraw cash from the travel                   Weekly
     card only after official travel has been authorized and no more than five days          Limitation:
     prior to the beginning of travel. However, the four individuals’ cash advances             $1,050
     occurred outside the allowable timeframe. One individual stated there was an
     account credit for the month and withdrew the money for personal use because of the credit. Two
     individuals completed travel and withdrew cash after official travel, although one was local travel only.
     In both cases, the employees stated they needed to take the advance after travel to cover expenses
     incurred during travel status. The fourth employee is a frequent traveler and withdrew cash on seven
     occasions before or after trips, but not within the authorized period.

     We also found employees had used the travel card for expenses while not on official travel. Federal
     Travel Regulations, agency policies, and cardholder agreements prohibit the use of the travel card for
     personal expenses and state that the card is to be used only for authorized travel expenses. We
     identified 22 transactions for 7 different employees, not corresponding to authorized travel. For
     example, one employee charged fuel, groceries, and dry cleaning expenses in a month where no travel
     was authorized. The employee stated they had a credit on the account and therefore used the travel



                                                         4
card for personal expenses to use up this credit, although this is not allowed according to FCA policy.
Another employee, who is now retired, used the travel card at a gas station and a shopping center in
two different months with no authorized travel. One employee used the travel card at a general store
and another used the travel card at a restaurant on two occasions and for parking expenses. Both
employees were not on official travel at the time of their transactions. One other former employee’s
transactions showed a charge for tolls and to a rental car company outside of authorized travel.
Because of the circumstances related to expenses charged on the travel card by two other employees,
we referred these cases for further evaluation.

We also identified 12 transactions where hotel expenses were incorrectly charged to employees’
accounts. FCA’s Policies and Procedures Manual (PPM) 711, Government Travel Charge Card,
specifically states the travel card is nontransferable and that no charges may be made on behalf of
another employee. However, we found that employees reserved rooms for a group of travelers for
official business, and in each of the four employee’s selected transactions, their accounts were
incorrectly charged or refunded for other employees’ expenses. For example, one individual reserved
three different rooms. When the individual checked out of the hotel, the hotel charged the individual
for three rooms even though the employee stated they told the hotel to charge the other rooms to the
other FCA travelers individually. The employee had not realized this occurred until our audit.

In addition, we found one individual who had not used the government travel card for official expenses,
as required. The individual traveled on 11 occasions and failed to use a government travel card despite
Federal Travel Regulations and agency policy requiring the individual to do so. The individual stated the
travel card had been misplaced and the individual, therefore, used a personal credit card for official
travel expenses for an extended period. After more than a year of consistently not using the travel card,
the individual requested a new card and began using the government travel card as required.

We found these unauthorized transactions occurred, in part, from a lack of understanding of policies
and a weakness in the reporting process. Although employees are required to have training on travel
card use, many of the employees we interviewed could not remember taking the training or noted that
the training was vague. Cardholders sign an agreement at issuance of the travel card stating the overall
requirements and personal use restrictions. In addition, refresher training is required every three years.
FCA and BFS consider re-signing the one-page statement of cardholder responsibility to be the refresher
training. However, FCA has not provided any updates, reminders, or distributions of information
beyond the original agreement and re-signing of the statement of cardholder responsibility every three
years.

We also noted FCA could improve the reporting process to help identify unauthorized charges. OMS
provides quarterly reports to FCA senior management showing all charges made to the travel cards by
each employee. High-level supervisors receive the reports, but OMS has not always distributed
information down to managers directly responsible for authorizing travel and supervising employees.
This is especially important because OMS notifies first level managers if an employee has a delinquent
account or questionable transactions. These reports have been identified as a tool to verify charges
related to official government travel. FCA’s PPM 711 states that supervisors will take appropriate
actions for improper transactions based on the quarterly report. However, supervisors cannot take
appropriate action if they are not receiving the reports.




                                                    5

Agreed-Upon Actions 1-2

To improve processes that reduce unauthorized use of the travel cards, OMS will:

    1.	 Provide education to cardholders, at least annually, regarding agency policies on cash
        withdrawals, personal use, procedures for when a credit is on an account, charging expenses
        related to other individuals, and mandatory use of the travel card for official travel.

    2.	 Determine a process to distribute quarterly transaction activity reports such that appropriate
        managers have the information and require a response on whether any transactions need
        further review.

Management Response

OMS distributed an article on August 14, 2014, to FCA employees on travel card policies and agreed to
update the Charge Card Management Plan to include annual education on travel card policies. OMS also
agreed to update policies and procedures on the distribution of quarterly transaction activity reports.
The most recent reports would also be distributed to managers to familiarize the individuals with the
process.

                                      Account Management

We also found that FCA could improve travel card account management. Two employees had been
identified as having restricted accounts; however, their set limits were not lowered. Citibank performs a
credit assessment on applications, and employees with a credit score of 659 or less receive a restricted
card. The Charge Card Management Plan states that if Citibank identifies an employee for a restricted
card, then a reduced spending limit will be put in place. The standard limit for FCA’s travel cards is
                                                                      $8,000. FCA currently has 15 travel
               Restricted Accounts	                                   cardholders with restricted
                                                                      accounts. Of the restricted
          2
                                                                      accounts, 1 account has a $1,000
                                            $1,000 Limitation
                     1 Cardholder                                     limit and 12 accounts have a $5,000
     Cardholders
                                            $5,000 Limitation         limit. However, 2 of the 15
                                                                      restricted accounts have the
                                            $8,000 Limitation
                                                                      standard limit of $8,000. One
                        12                                            employee had prior travel card
                   Cardholders                                        misuse, and OMS designated the
                                                                      travel card as restricted. Although
                                                                      OMS noticed the misuse, risk
                                                                      mitigation was not realized because
                                                                      the individual’s limit was not
                                                                      lowered. OMS did, however,
monitor the employee’s transactions for an additional three months after the misuse was found.
Another employee requested a higher limit, which OMS approved even though the individual had a
restricted status.




                                                    6

 During our review over the 19-month period, we found that employees had not always made payments
 for travel card expenses within the authorized timeframes. If a cardholder’s account is not paid by the
 due date, the account can go into delinquency status. Agency policy and user agreements state that
 travel cards must be paid in full by the due date. FCA’s monthly delinquency reports sort cardholder
 accounts into categories of 30-day increments. For example, the listing shows cardholder accounts 0-30
 days past due and 31-60 days past due up to over 180 days. During our review of the delinquency
 reports, we found 27 instances of accounts that went into the presuspension status annotated as 31-60
 days past due and 4 accounts that went into suspension status annotated as 61-90 days past due. The
 following chart shows all delinquent accounts for the period of our review:


            30

            25
                                                                                                                                                                                            0-30 DAYS
                                                                                                                                                                                            PAST DUE
            20
                                                                                                                                                                                            31-60 DAYS
Number of   15                                                                                                                                                                              PAST DUE
Employees
                                                                                                                                                                                            61-90 DAYS
            10
                                                                                                                                                                                            PAST DUE

             5

             0
                                   Dec-12




                                                                                May-13
                                                                       Apr-13




                                                                                                                                               Dec-13
                 Oct-12
                          Nov-12


                                            Jan-13


                                                              Mar-13




                                                                                         Jun-13


                                                                                                           Aug-13




                                                                                                                                                                                   Apr-14
                                                                                                                             Oct-13
                                                                                                                                      Nov-13


                                                                                                                                                        Jan-14


                                                                                                                                                                          Mar-14
                                                     Feb-13




                                                                                                  Jul-13


                                                                                                                    Sep-13




                                                                                                                                                                 Feb-14



 We also identified two employees listed as current travel card holders that were no longer with FCA.
 One individual retired in December 2013 and the other employee left the agency in April 2014. The
 open travel card listing as of May 2014 contained both cardholders. Agency officials had not completed
 the individuals’ clearance documents in a timely manner. Before an employee’s departure, the
 employee must have the FCA Form 302, Employee Check Out Record, completed and submitted before
 the last day of work. To complete the form, OMS officials must sign the signature block for travel card
 clearance. The employee then receives final clearance before separation. However, the retired
 individual noted above received travel card clearance 34 days after the last day at the agency. OMS
 cleared the other employee for the travel card about 7 days after the separation date. OMS officials
 stated the check out record often arrives late and the timeframes do not allow for completion in time
 for most employees exiting FCA. Therefore, OMS officials run a different report to verify employees that
 are exiting and initiate actions based on that information. OMS provided verification that BFS was
 informed that both employees were leaving the agency through this process. However, OMS did not
 document this process in the Charge Card Management Plan and had not verified the accounts were
 closed.

 We found the account management weaknesses occurred for various reasons. Neither the Charge Card
 Management Plan nor the agency travel policy, PPM 711, identified steps to be taken if misuse was



                                                                                                   7

detected, such as a process for restricting the limitation on travel cards. The Charge Card Management
Plan and travel policy also did not address when and how to remove or add an individual from a
restricted status. Regarding the delinquent accounts, OMS generally issued the notifications to
cardholders and their supervisors. However, the agency has not fully defined actions to be taken on
delinquent accounts. For example, the travel card policy states the accounts may be suspended, but
does not address the consequences of a suspension. Neither the PPM 711 nor the Charge Card
Management Plan address how supervisors are to handle delinquent accounts or a cardholder with a
history of delinquency. The Charge Card Management Plan also specifically states that FCA notifies BFS
to close out accounts. However, the plan does not address confirming closures or reconciling the open
status report to verify the closures. For the two individuals remaining on the open status listing, FCA
had established but not followed the travel card check out procedures and had not documented the
current process for clearing employees’ travel cards. Further, although FCA had a travel card check out
process, it was ineffective in clearing employees in a timely manner.

Agreed-Upon Actions 3-5

To improve travel card account management, OMS will:

    3.	 Document procedures on placing or removing an account in restricted status and changes to
        travel card limits.

    4.	 Incorporate and document a reconciliation of open status accounts on a quarterly basis to
        ensure accounts of departed employees are closed.

    5.	 Evaluate the sufficiency of existing check out procedures to ensure travel cards are closed as
        employees depart and update the Charge Card Management Plan to correspond with
        procedures.

Management Response

OMS agreed to document procedures on placing or removing an account in restricted status and
changes to travel card limits in the Charge Card Management Plan. OMS also agreed to review all open
travel card accounts each quarter to ensure accounts are closed and to document the review in the
travel card report. OMS agreed to update the Charge Card Management Plan to correspond with
current check out procedures

                                    Policies and Procedures

We also found that FCA should update the travel card policies and procedures. The Government Charge
Card Abuse Prevention Act of 2012 mandated that agencies provide for appropriate adverse personnel
actions to be imposed when employees fail to comply with travel card terms and conditions or agency
regulations or commit fraud with respect to a travel card, including removal in appropriate cases.
Further, Federal Travel Regulations state that internal agency policies and procedures should define
what the agency considers misuse of the travel card. PPM 711 states that if a cardholder uses the travel
card for purposes other than official travel, FCA may take disciplinary action. However, infractions and
corresponding actions leading to removal had not been defined. Further, FCA’s PPM 826, Disciplinary
and Adverse Actions, specifically addresses misuse of agency purchase cards but not travel cards.



                                                    8

Although the listing is not all-inclusive, the PPM contains a table of penalties that identifies significant
offenses for which disciplinary action is appropriate and provides recommended action guidelines. The
PPM and table of penalties do not address travel cards. Lastly, PPM 711, PPM 826, and the Charge Card
Management Plan do not include specific definitions of what is considered travel card misuse.

We also identified inconsistencies between PPM 711 and the Charge Card Management Plan. FCA’s
PPM 711 states that employees may obtain cash advances five days before the beginning of travel, and
the Charge Card Management Plan states it is seven days. PPM 711 states that cardholders and their
supervisors are notified of delinquencies that are 31-60 days past due. However, the Charge Card
Management Plan states this will occur when accounts are more than 60 days past due.

Agreed-Upon Actions 6-8

To address the updates needed to the travel card policies and procedures, OMS will:

    6.	 Update PPM 711 to include steps to be initiated regarding delinquent accounts and potential
        disciplinary actions, including dismissal, resulting from illegal, improper, and erroneous
        purchases.

    7.	 Update PPM 826 to include: disciplinary and adverse action steps related to illegal, improper,
        and erroneous travel card purchases; account delinquency actions; and, definitions of travel
        card misuse.

    8.	 Update the Charge Card Management Plan to correspond with PPM 711 on cash advances and
        delinquency notifications.

Management Response

OMS agreed to update the policies and procedures. The specific tasks to be completed include revising
PPM 711 and PPM 826 and updating the Charge Card Management Plan to correspond with PPM 711.

Overall, OMS agreed with the report and did not provide any comments. An exit conference was held
with management on July 31, 2014.




                                                     9

ACRONYMS


           BFS   Bureau of the Fiscal Service

           FCA   Farm Credit Administration

           GSA   General Services Administration

           OIG   Office of Inspector General

           OMB   Office of Management and Budget

           OMS   Office of Management Services

           PPM   Policies and Procedures Manual




                                            10

           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