FY 2019 Audit of VA’s Compliance under the DATA Act of 2014

Report Information

Issue Date
Report Number
19-07247-251
VA Office
Office of the Secretary (SVA)
Report Author
Office of Audits and Evaluations
Report Type
Audit
Recommendations
16
Questioned Costs
$0
Better Use of Funds
$0
Congressionally Mandated
No

Summary

Summary
The VA Office of Inspector General (OIG) contracted with the independent public accounting firm CliftonLarsonAllen LLP (CLA) to audit VA’s compliance under the Digital Accountability and Transparency Act of 2014 (DATA Act) for the first quarter of fiscal year 2019. The DATA Act requires the inspector general of each federal agency to review a statistically valid sample of the spending data submitted for publication on the website USASpending.gov. Each inspector general must then submit a publicly available report to Congress with an assessment of the completeness, timeliness, quality, and accuracy of the data sampled, along with the implementation and use of government-wide financial data standards. This is the second of three required biennial reports in accordance with the schedule recommended by the Council of the Inspectors General on Integrity and Efficiency. CLA reported that VA’s existing financial management and related systems have limited functionality to fully support the reporting standards and requirements under the DATA Act. Also, data management and reporting processes need improvement to ensure compliance with those requirements. As a result of these challenges, CLA reported that VA did not fully meet the reporting standards and attributes of completeness, timeliness, quality, and accuracy. Recommendations from CLA include that VA continue system modernization efforts and improve internal controls over certain aspects of the data-submission process. Overall, CLA made 16 recommendations for improving compliance under the DATA Act. VA’s response to CLA’s draft report indicated concurrence with all recommendations, and planned corrective actions are responsive. CLA is responsible for the attached report dated November 4, 2019, including its conclusions and recommendations. The OIG does not express an opinion on VA’s compliance.

Open Recommendation Image, SquareOpenClosed and Implemented Recommendation Image, CheckmarkClosed-ImplementedNot Implemented Recommendation Image, X character'Closed-Not Implemented
No. 1
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer continue the system modernization efforts that provide VA with the capability to generate the required DATA Act reporting files containing the necessary elements to meet compliance with the DATA Act. Ensure the modernization will provide the following: a. Accurate reporting of object class, program activity codes, program activity names and all other elements required by the DATA Act. b. Store award identification to allow VA to be able to develop a File C and reconcile the File C to both summary level data (Files A and B) and award level data (File D). The reconciliations should be performed prior to the quarterly certification. c. Report reconciliation with its subsidiary systems. d. A mechanism to ensure transactions are reported that currently may be excluded due to the use of 1358s. e. Standardize data field use to allow for management to record an award ID across financial and supporting systems.
No. 2
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Ensure a DQP is finalized and implemented for future DATA Act submissions which meets the requirements for DATA Act reporting. In addition, the Office of Management, Office of Internal Control, and the Office of Enterprise Risk Management should ensure that the DQP supports the annual assurance statement and quarterly certification.
No. 3
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Implement a grants management solution that will be either integrated with the new financial system or interface into it once completed. The VA should identify a grants management solution that can be implemented across all of VA’s grant programs.
No. 4
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Work with the SAO and component level SAO’s to ensure that all certifications are signed, dated by the component SAO and received prior to the submission date.
No. 5
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Ensure that the four CFDA programs (64.014, 64.015, 64.026, and 64.024) report obligations according to the definitions established for FABS reporting or obtain OMB and Treasury’s approval for any deviations.
No. 6
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Ensure the Office of Budget implements monitoring controls over CFDA numbers to ensure any CFDA numbers that require activation are identified and activated promptly to avoid interruptions in expenditure reporting.
No. 7
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Research the basis for the delays in reporting expenditure data for FABS for the VHA Veterans Prescription Service program (CFDA # 64.012) and implement a corrective action plan for timely reporting going forward. The VA PMO should also seek an exemption from OMB and Treasury regarding the reporting delays for the program if no viable solutions are identified to mitigate the timing delays.
No. 8
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Obtain and document guidance from Treasury and OMB on the proper treatment of payments to contractors for VA’s Veterans Choice Program as either contract award (File D1) or financial assistance (File D2).
No. 9
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Obtain and document guidance from Treasury and OMB regarding inclusion of payroll and contract costs in the FABS (File D2) and the duplication of the same contract costs in the FPDS-NG (File D1).
No. 10
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Implement internal controls and update policies and procedures to improve the accuracy of and completeness of the information submitted for FABS reporting. The internal controls should ensure the following: a. Excluded payments not reported due to zip code issues are researched, cleared, and reported in VBA’s sub certification. b. The default code “90” for Congressional District is not used when the county or zip code are unknown; instead, perform research to obtain the required data. c. Support from Treasury and OMB on the proper reporting of face amount of insurance in its FABS submissions. d. The information submitted for each data element is adequately supported and readily available. e. All data elements are reported in compliance with the definitions established by the DAIMS.
No. 11
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Improve review procedures prior to submission to identify errors and ensure all transactions are included in procurement and financial assistance data.
No. 12
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Perform research to determine the extent to which 1358 transactions are not reported for File D1 and develop solutions.
No. 13
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Develop solutions and continue system modernization efforts to reduce the use of the default object class. Research and develop program activity crosswalk for medical services.
No. 14
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Strengthen procedures over the process to report all program activity names and program activity codes that are reported in the quarterly OMB MAX Collect Exercise in accordance with the latest Budget Data request requirements.
No. 15
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Reinforce guidance for Contracting Officers concerning areas where exceptions were noted in DATA Act reporting.
No. 16
Closed and Implemented Recommendation Image, Checkmark
to Office of Management (OM)
We recommend the Assistant Secretary for Management and Chief Financial Officer Obtain OMB and Treasury approval for aggregating and reporting transactions based on beneficiary address. Ensure controls around the aggregation process are implemented and operating effectively.