Open Recommendations

(U) Rec B.2: Recommendation is Classified.

Rec. 1.b: The DoD OIG recommended that the Chief Digital and Artificial Intelligence Officer coordinate with the Director of Administration and Management to review existing guidance to determine which should be canceled or incorporated into DoD Directive 5105.UW and DoD Instruction 8410.dd, and then approve DoD Directive 5105.UW and DoD Instruction 8410.dd.

We recommend that EAC management document policies and procedures for all significant process areas; including outlining the responsibilities of EAC personnel and the responsibilities of EAC’s service providers.

We recommend that EAC management ensure that all management and personnel, directly and indirectly responsible for performing processes outlined, have read, and understand the documented policies and procedures.

We recommend that EAC management perform periodic review of policies and procedures, and policies and procedures are updated in a timely manner.

We recommend that EAC management develop process narratives to assist new and transitioning personnel in understanding their scope of responsibilities and job function as well as help management perform review.

The assistant secretary for information and technology and chief information officer improve vulnerability management processes to ensure all vulnerabilities are identified and that plans of action and milestones are created for vulnerabilities that cannot be mitigated by VA deadlines.

We recommend that the Washington State Department of Social and Health Services' Aging and Long-Term Support Administration work with the 20 adult family homes to correct the 214 instances of noncompliance identified in this report.

Treasury Office of Inspector General (OIG) should request West Virginia management to provide support for replacement expenses, not previously charged, that were eligible during the CRF period of performance for the $20,917,332 of ineligible costs charged to the Direct Payments greater than or equal to $50,000 payment type. If support is not provided, Treasury OIG should recoup the funds. Based on West Virginia's responsiveness to Treasury OIG's requests and West Virginia's ability to provide sufficient documentation and/or replace ineligible transactions charged to CRF with valid expenditures, Castro recommends Treasury OIG determine the feasibility of conducting an audit for the Direct…

Treasury Office of Inspector General should follow-up with West Virginia's management to confirm if the transactions noted as unsupported expenditures of $657,742 within Aggregate Payments to Individuals can be supported. If support is not provided, Treasury OIG should recoup the funds or request West Virginia management to provide support for replacement expenses, not previously charged, that were eligible during the CRF period of performance. Based on West Virginia's responsiveness to Treasury OIG's requests and West Virginia's ability to provide sufficient documentation and/or replace unsupported transactions charged to CRF with valid expenditures, Treasury OIG should determine the feasibility of conducting an…

GLS should amend its procedures relating to the annual count and valuation of operating materials and supplies to include verification of unit and total costs. This should include locating or reconstructing source documentation for the total quantity on hand for each item and matching the costs entered in the system to the source documents.

GLS should determine how average costs are calculated within the inventory tracking system. If the average cost in the system for specific inventory items does not represent the average cost of inventory on hand, the average cost in the system should be periodically adjusted when the annual inventory is performed or at year-end.

GLS should continue executing its corrective action plan and complete the review of the unit and total costs of inventory items.

Proactively and independently initiate discussions with Legal Counsel on an at least quarterly basis in order to identify contingent liabilities which should be recognized and/or disclosed in the Corporation's financial statements and footnotes so that appropriate entries can be recorded, and/or notes disclosures prepared, prior to the finalization of the financial statements and footnotes.

Document the actions taken to verify that the information received is complete and whether information is needed from other sources to complete the financial reporting process.

Update the Corporation's standard operating procedures to incorporate timely inquiries of legal counsel during the preparation of the financial statements and footnotes.

STB management should amend its existing policy regarding the review and approval of journal vouchers to include a review of all non-reversing entries recorded during the fiscal year and to review all year-end journal vouchers before they are recorded in the agency's general ledger.

STB management should perform and document a review of all manual journal entries that includes a before and after analysis which illustrates the effect of the entry on the principal financial statements using the current year Treasury United States Standard General Ledger (USSGL) Section V Crosswalks to the financial statements. If accounts are presumed to offset, then they must offset within the same line of the same financial statement within the same fiscal year reporting period (i.e., before closing entries are recorded following the end of the fiscal year).

At least quarterly, STB management should initiate and document a review of all entries and account balances for which a manual correcting entry may be needed to address potential misstatements due to system posting logic, such as offsetting upward and downward adjustments of prior year obligations, and record the appropriate entries to prevent misstatement of financial statement accounts and line items.

During the review of manual journal vouchers, STB management should verify and document that the authoritative guidance and internal tools used to support the entry are valid and current.

The STB Finance Team should complete training relating to adjusting entries, including the selection of USSGL accounts, to improve the quality and precision of the review and approval process.

STB management should independently review the most current version of OMB Circular A-136 and the USSGL Treasury Crosswalks to identify changes in data elements, classification, and presentation and ensure that these changes are incorporated into financial statement and footnote templates for current year reporting. A search for new versions of the USSGL Crosswalks and OMB Circular A-136 should be performed each time the financial statements are prepared.

STB management should review the current version of OMB Circular A-136 to independently verify that all required footnotes are included and bring any omissions to the service provider's attention so that errors or omissions can be corrected.

STB management should review the service provider's Financial Statement and Notes Review Checklist to verify that the checklist is up to date and includes all required elements per OMB and Treasury guidance and then complete the checklist independently. Alternatively, STB management should develop and complete its own review checklist based on current Treasury and OMB reporting requirements.

STB management should request its financial management service provider to:
Reevaluate the inclusion of account balances that were excluded in the Other Liabilities footnote, or
Disaggregate (i.e., separately report) intragovernmental other liabilities balances reported as a single line item on the balance sheet that are not included in the footnote so that the total amounts reported for Other Liabilities on the balance sheet and in the footnote agree.