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The Coronavirus Aid, Relief, and Economic Security (CARES) Act appropriated about $17.2 billion in supplemental funds to the Veterans Health Administration (VHA) to support VA’s efforts to prevent, prepare for, and respond to the COVID-19 pandemic. The OIG conducted this audit to assess the effectiveness of VA’s controls over VHA’s use of these funds.
Because VA’s financial management system does not support the direct obligation of supplemental funds for all expenses, staff used expenditure transfers to shift funds between appropriation accounts. Expenditure transfers are documented using journal vouchers, which are written documents explaining the purpose and details of the transaction. However, as VHA did not develop guidance for the type of documentation required, staff did not always sufficiently prepare the vouchers. As a result, staff could not always identify what was purchased or provide evidence the purchase was a proper use of CARES Act funds.
Further, even when medical staff directly obligated from the CARES Act fund, they did not always (a) have documented purchase authority, (b) segregate duties, (c) properly track the receipt of goods to ensure the quantities ordered were received, or (d) properly certify and pay invoices. This occurred because VHA did not develop guidance with protocols for accounting processes and procedures or outline clear roles and expectations for the oversight of supplemental funds purchases. As a result, the OIG questioned an estimated $187.2 million.
Until VHA strengthens controls over payments, it cannot be sure that payments have been properly made. Further, Congress lacks reasonable assurance that funds allocated for veterans’ COVID-19-related care are being spent as intended. The OIG recommended VA assess whether it can integrate its financial management system with other systems to reduce the need for expenditure transfers; the OIG also made eight recommendations to VHA to improve oversight of supplemental funds.
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