Commerce OIG’s Budget and Staff Resources and Reported Monetary Accomplishments for Fiscal Years 2011 through 2013

		Commerce OIG’s Budget and Staff Resources

The Commerce OIG had total budgetary resources of approximately   $41 million in fiscal year 2013. Also, while five of these other OIGs had a decline in total budgetary  resources equal to or greater than that of the Commerce OIG, the  Commerce OIG’s decline was greater than the 6 percent average decline  for all other cabinet-level OIGs during the 3-year period. Commerce OIG’s Reported Monetary Accomplishments

The Commerce OIG reported approximately $543 million in monetary  accomplishments from audits, evaluations, and investigations during  fiscal years 2011 through 2013. While the Commerce OIG’s  return was within the range of the lowest and highest returns for all other  OIGs for each fiscal year, its average return on each budget dollar of  $4.18 over the 3-year period was less than the average of $22.64 for the  other OIGs. Commerce OIG Focused on Large Programs but Lacked Audit Coverage of Important Smaller Programs

During the 3-year period we reviewed, OAE issued 90 reports including  mandatory audits, performance audits, evaluations, and memorandums,  intended to provide oversight of Commerce’s 13 major bureaus and  offices identified in the OIG’s semiannual reports.reports issued, or 93 percent, were directed to four bureaus and offices,  and to department-wide issues managed by the Office of the Secretary. However, the OIG did  not conduct audits in the high-risk areas of managing federal real property  and ensuring the effective protection of technologies critical to U.S.  national security interests during the 3-year period. The Commerce OIG did not provide audit coverage of  this high-risk area during the 3-year period we reviewed, but as a result of  a congressional request, the OIG completed an audit of the Bureau of  Industry and Security’s licensing of exports related to these programs in  September 2014. The Commerce OIG’s Hotline Policies and Procedures Were Generally Consistent with Recommended Practices but Were Not Always Followed

The Commerce OIG’s hotline policies and procedures were generally  consistent with recommended hotline practices provided through CIGIE. However, our testing of a random sample of OIG hotline cases from fiscal  years 2011, 2012, and 2013 identified numerous instances in which OIG  staff did not follow the OIG’s formal hotline policies and procedures that  we selected for review. The Commerce OIG  followed much of the OPM guidance to address the 2012 FEVS results  but lacked an action plan with measures of success. In addition, the OIG’s audit plans did not fully consider all  GAO high-risk areas applicable to Commerce, which resulted in areas  that were not subject to audit. However, the OIG did not develop an action plan with measures of  success to reasonably assure that employee concerns are effectively  addressed. Recommendations for Executive Action

To provide increased performance audit coverage of Commerce’s  bureaus and offices, the Commerce IG should augment the OIG’s risk- based audit planning process to consider (1) a rotation of performance  audit coverage among the smaller bureaus and offices to help ensure that  the economy, efficiency, and effectiveness of their programs are  periodically reviewed and (2) all applicable high-risk areas identified by  GAO. Agency Comments

We provided a draft of this report to the Commerce IG for comment. GAO staff members who made key contributions to  this report are listed in appendix V.

Appendix I: Scope and Methodology

To provide information on the budget, staff resources, and  accomplishments of the Department of Commerce (Commerce) Office of  Inspector General (OIG) and the other cabinet-level OIGs, we obtained  access to the Office of Management and Budget database of budget  information for fiscal years 2011 through 2013 for comparison among  these OIGs. To review the effectiveness of the Commerce OIG in addressing  complaints and allegations of wrongdoing received by its hotline during  fiscal years 2011 through 2013, we compared the OIG’s policies and  procedures with recommended hotline practices provided through the  Council of Inspectors General on Integrity and Efficiency. To review the Commerce OIG’s effectiveness in addressing issues  identified by the OIG and based on its employees’ responses to the Office  of Personnel Management’s (OPM) annual Federal Employee Viewpoint  Survey (FEVS), we obtained the Commerce OIG survey responses to the  71 questions from OPM for fiscal years 2012, 2013, and 2014 that  addressed the employees’ work experience, work unit, agency,  supervisors, leadership, and satisfaction.
Why GAO Did This Study

Congressional committees and Commerce leaders rely on the OIG to provide oversight of the agency's wide range of responsibilities. GAO was asked to review the effectiveness of the Commerce OIG's oversight. GAO's objectives were to provide information on the Commerce OIG's budgets, staffing, and accomplishments, and to review the OIG's effectiveness in providing audit coverage, addressing hotline complaints, and addressing employee concerns identified in OPM's annual FEVS.
For fiscal years 2011 through 2013, GAO identified the budget and staff resources of the Commerce OIG and other cabinet-level OIGs and their reported accomplishments for comparison; reviewed the Commerce OIG's audit coverage of bureaus and offices, management challenges, and high-risk areas; compared the OIG's hotline policies with hotline guidance provided through CIGIE; and tested a random sample of hotline complaints. GAO also reviewed the OIG's efforts to address employee concerns from the 2012 FEVS results.

What GAO Found

During fiscal years 2011 through 2013, the Department of Commerce (Commerce) Office of Inspector General (OIG) experienced reductions in total budgetary resources from about $47 million to about $41 million, or almost 13 percent, compared to the average reduction of about 6 percent for all other cabinet-level OIGs. The Commerce OIG had a decline of full-time equivalent staff from 171 to 137, or about 20 percent, which was a greater decline than the average decline of about 5 percent for the other OIGs. The Commerce OIG reported approximately $543 million in monetary accomplishments from audits, evaluations, and investigations for the period. Differences in missions and programs of the cabinet-level departments and agencies result in varied opportunities for OIGs to provide monetary accomplishments. While the Commerce OIG's return on each budget dollar was within the range of the lowest and highest returns for all other OIGs for fiscal years 2011 through 2013, its average return of $4.18 over the 3-year period was less than the average return of about $22.64 for the other cabinet-level OIGs.
During this period of constrained resources, the Commerce OIG conducted mandatory audits that covered all bureaus and offices and provided performance audit coverage of Commerce's largest bureaus and offices. It also audited areas identified by the OIG as management challenges. However, the OIG did not conduct performance audits of the economy, efficiency, and effectiveness of programs specific to Commerce's smaller bureaus and offices, which had combined fiscal year 2013 total budgetary resources of approximately $2.4 billion, during the 3-year period. In addition, the OIG did not conduct audits over the 3-year period of two areas on GAO's high-risk list relevant to Commerce: (1) managing federal real property and (2) ensuring the effective protection of technologies critical to U.S. national security interests. The OIG's risk-based audit planning contributed to gaps in audit coverage as the office did not provide periodic performance audit coverage of Commerce's smaller programs on a rotational basis and did not fully consider all GAO high-risk areas.
The Commerce OIG's hotline policies and procedures were generally consistent with recommended hotline practices of other OIGs provided through the Council of Inspectors General on Integrity and Efficiency (CIGIE). However, through a review of a random sample of OIG hotline cases from fiscal years 2011 through 2013, GAO identified numerous instances where the OIG did not follow one or more of its own hotline policies and procedures regarding the processing, disposition, and timeliness of hotline cases. The OIG could not reasonably ensure that its hotline policies and procedures were consistently followed because of a lack of ongoing monitoring of its internal control activities.
The Commerce OIG's Federal Employee Viewpoint Survey (FEVS) results for 2013 and 2014 improved after OIG efforts to address the poor 2012 FEVS results, but responses to specific survey questions remain lower than the government-wide average. The OIG's efforts followed much of the guidance issued by the Office of Personnel Management (OPM) to address FEVS results, but they did not include an action plan with measures of success.

What GAO Recommends

GAO recommends that the IG (1) augment the OIG's audit planning to consider a rotation of performance audit coverage among smaller Commerce programs, and applicable GAO high-risk areas; (2) include monitoring of internal controls for the OIG's hotline operations; and (3) develop an action plan with measures of success to address FEVS results.
In commenting on a draft of the report, the Commerce IG concurred with GAO's recommendations.