Treasury Inspector General for Tax Administration
August 16, 2010
TIGTA - 2010-43
Contact: Karen Kraushaar
WASHINGTON - While the Internal Revenue Service (IRS) has taken steps to prepare for procurements made under the American Recovery and Reinvestment Act of 2009 ("Recovery Act"), it lacked necessary controls to ensure the procurements would comply with the new requirements, according to an audit publicly released by the Treasury Inspector General for Tax Administration (TIGTA).
TIGTA initiated the audit to determine the IRS's readiness to implement the Recovery Act requirements for procurements and found that the IRS has not developed written procedures, provided formal training for those employees procuring goods and services, or dedicated sufficient resources for the tracking and reporting requirements associated with the Recovery Act. TIGTA has scheduled a related audit of Recovery Act funded procurements to determine whether the IRS has complied with the new requirements.
In April of 2009 the IRS received $203 million in Recovery Act funds. TIGTA determined that the IRS did not always comply with Recovery Act procurement requirements. TIGTA reviewed 10 procurements from the IRS' Recovery Act Procurement Plans and determined that two did not comply with the new procurement requirements. In addition, the IRS used annual appropriated funds instead of Recovery Act funds for six of the 10 procurements. As a result, approximately $385,000 was not available for other IRS mission-critical needs.
"The IRS must ensure that it complies with all Recovery Act procurement requirements and uses its Recovery Act funds for their intended purpose," said J. Russell George, the Treasury Inspector General for Tax Administration. "Until IRS management provides the necessary oversight and guidance to IRS program office and procurement personnel, it will continue to be at risk of noncompliance with the Recovery Act," he added.
TIGTA recommended that the IRS strengthen controls for Recovery Act procurements, including developing written procedures, providing training to both program office and procurement personnel, and reevaluating the resources assigned to track and report IRS Recovery Act procurements.
The IRS agreed with TIGTA's recommendations and plans to make improvements.
To view the report, including the scope, methodology, and full IRS response, go to: http://www.treas.gov/tigta/auditreports/2010reports/201011071fr.pdf.
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