Audit Report

OIG-07-033

GENERAL MANAGEMENT: Few Exceptions Found With TBARR 

Payments 

March 12, 2007 

Office of 

Inspector General 

Department of the Treasury 

Contents 

GENERAL MANAGEMENT: Few Exceptions Found With TBARR Payments Page 1 

(OIG-07-033) 

Audit Report................................................................................................. 3 

Background ................................................................................................... 5 

Finding and Recommendation............................................................................ 5 

 

 Two Errors Were Made to Charges to the TBARR Appropriations Accounts........ 5 

 

 Recommendation......................................................................................... 7 

Appendices

 Appendix 1: Objective, Scope, and Methodology........................................ 8 

 Appendix 2: Management Response ......................................................... 11 

 Appendix 3: Report Distribution................................................................ 12 

Abbreviations

 DO Departmental Offices 

 GAO Government Accountability Office 

 IPAC Intragovernmental Payment and Collection 

 OFAC Office of Foreign Asset Control 

 OFM Office of Financial Management 

 TBARR Treasury Building and Annex Repair and Restoration 

 Treasury Department of the Treasury 
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OIG Audit Report

The Department of the Treasury 

Office of Inspector General 

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(OIG-07-033) 

March 12, 2007 

Richard Holcomb 

Acting Chief Financial Officer 

The Conference Report for the Consolidated Appropriations Act, 

2004, directed our office to comprehensively audit all Treasury 

Building and Annex Repair and Restoration (TBARR) Program 

contracts since fiscal year 1998.1

 The audit was to include (1) a 

review of compliance with all applicable procurement laws, rules, 

and regulations and with the Architectural Barriers Act of 1968, as 

amended; (2) a review of the scope, requirements, and cost 

reasonableness of the project, as well as the process for managing 

change orders to the original scope and design; and (3) a review of 

the effectiveness, efficiency, and economy of contractor 

operations. Further, the Conference Report for the Consolidated 

Appropriations Act, 2005, directed our office to complete the audit 

work on the TBARR Program, including determining whether the 

renovation work was in compliance with building codes.2 We were 

also asked to identify costs associated with delays in employee 

moves into alternative space during restoration phases. 

We have addressed these objectives in a series of audit reports. 

During fiscal year 2004, we issued two interim audit reports, one 

on project planning and one on contract award and administration.3

During fiscal year 2005, we issued two interim audit reports, one 

on costs associated with delays in employee moves during 

renovation and one on building code compliance of the renovation 

 

1

 House Report (H.R.) 108-401. 

2

 H.R. 108-792. 

3 GENERAL MANAGEMENT: Management of the Treasury Building and Annex Repair and Restoration 

Program Needs to Be Strengthened (OIG-04-039; issued August 9, 2004); GENERAL MANAGEMENT: 

Treasury Building and Annex Report and Restoration Program Procurement Practices Need to be 

Improved (OIG -04 -043; issued September 23, 2004) 
GENERAL MANAGEMENT: Few Exceptions Found With TBARR Payments Page 4 

(OIG-07-033) 

work.4 This is the final audit report on our audit of the TBARR 

program. 

The objective of the current audit was to assess contract and other 

costs charged to TBARR appropriations accounts to determine if 

the payments were authorized, proper, accurately recorded, 

adequately supported by documentation, and made for the 

purposes intended. 

In brief, we concluded that, overall, TBARR payments were 

generally spent for the purposes and within the time periods 

specified by Congress. However, we found that the Office of 

Financial Management (OFM) inappropriately charged TBARR 

appropriations accounts for expenses that should have been 

charged to the Office of Foreign Assets Control (OFAC), a 

component of Departmental Offices (DO), and Treasury’s Working 

Capital Fund accounts. The amount of the incorrect charges was 

$68,358. We are recommending that the accounting records for 

TBARR, the Working Capital Fund, and OFAC be corrected for 

these expenses. 

We also want to bring to your attention that for 20 TBARR 

payments, OFM was not able to provide the supporting original 

documentation. We were able to validate the payments through 

alternate procedures. However, we believe that maintaining original 

documentation is a matter that requires continued management 

attention. 

We performed our audit fieldwork from November 2005 through 

November 2006 at OFM in Washington, D.C. Appendix 1 contains 

a more detailed description of our objective, scope, and 

methodology. 

 

4 TBARR: Cost of Employee Move Delays During Main Treasury Building Renovation Could Not Be 

Determined (OIG-05-035; issued April 1, 2005; TBARR: While Progress Has Been Made On The Main 

Treasury Renovation, Code Violations And Other Deficiencies Need To Be Corrected (OIG-05-042; 

issued July 29, 2005) 
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Background 

After a June 1996 roof fire resulted in major damage to the Main 

Department of the Treasury (Treasury) building, Treasury decided 

to modernize the building. The TBARR Program was established in 

August 1998 for the purposes of (1) repairing and restoring the 

Main Treasury building to correct the damage caused by the roof 

fire, (2) restoring the historic fabric of the building, and 

(3) modernizing the building and its systems to comply with current 

codes and standards. At the same time, Treasury established the 

TBARR Program Office within the Office of Management to procure 

related services, oversee design and construction activities, and 

coordinate employee moves during construction. 

From fiscal year 1995 through fiscal year 2005, Treasury expended 

approximately $229 million for the TBARR project. These payments 

consisted of disbursements for TBARR employees’ salaries and 

expenses, vendor invoices, and credit card bills. They also included 

payments made through the Intragovernmental Payment and 

Collection (IPAC)5

 system to transfer funds to other federal 

agencies that provided goods or services to the TBARR project. To 

process TBARR payments, OFM used the Federal Financial System 

from fiscal year 1995 through fiscal year 2003 and has used the 

Oracle Federal Financials System since then to the present. 

 

Finding and Recommendation 

Finding 1 Two Errors Were Noted to Charges to the TBARR 

Appropriations Accounts 

To determine whether costs were allocated appropriately, we 

tested 55 payments totaling $3.2 million in which costs were split 

between TBARR Program and DO appropriations accounts. These 

55 payments were made to 11 contractors and principally 

represented low and high-dollar amounts. We found that OFM 

 

5

 IPAC is an Internet-based collection and payment system. It facilitates the intragovernmental transfer 

of funds by providing a standardized interagency fund transfer mechanism for federal agencies. 
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inappropriately charged TBARR appropriations accounts, rather 

than other DO appropriations accounts and the Working Capital 

Fund, for 2 of the 55 payments. 

• In one case, a payment of $42,124 was charged to the TBARR 

appropriation account instead of the Working Capital Fund.6 The 

TBARR Program Office submitted the required obligating 

documentation reflecting the change from TBARR to the 

Working Capital Fund, but the OFM accounting technician did 

not make the change in the OFM payment system. We were 

unable to contact the technician because she no longer works 

at OFM. 

• In the second case, a payment of $26,234 was charged to the 

TBARR appropriations account instead of OFAC.7

Documentation we reviewed for the transaction indicated that 

the cost center for the obligation was assigned to OFAC for 

non-TBARR related work. OFM’s accounting technician told us 

that since the contractor was a TBARR contractor who was 

doing OFAC work, he assumed that the payment should have 

been charged to TBARR. The technician did not refer to the 

original obligating documents that contained the correct cost 

center and appropriations account. 

According to the Government Accountability Office’s (GAO) 

Standards for Internal Control in the Federal Government,

transactions should be promptly recorded to maintain their 

relevance and value to management in controlling operations and 

making decisions. This applies to the entire process or life cycle of 

a transaction or event from the initiation and authorization through 

its final classification in summary records. In addition, control 

activities help to ensure that all transactions are completely and 

accurately recorded. 

 

6 The Department of the Treasury’s Working Capital Fund is a revolving fund that was created by 

Congress to centrally provide common administrative services across Treasury that would result in 

economies of scale, eliminate duplication of effort and redundancy. 

7

 The Office of Foreign Assets Control administers and enforces economic and trade sanctions based on 

U.S. foreign policy and national security goals against targeted foreign countries, terrorists, international 

narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass 

destruction. 
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Recommendation

We recommend that the Acting Chief Financial Officer direct OFM 

to make necessary adjustments to the accounting records for 

TBARR, the Working Capital Fund, and OFAC to correct erroneous 

charges disclosed as a result of our review. 

Management Response 

Management agreed with the finding and indicated that corrective 

actions were underway to address each of the items. The 

corrective actions will be completed by March 30, 2007. 

OIG Comment

Management’s planned corrective action is responsive to the intent 

of our recommendation. 

 * * * * * 

We appreciate the courtesies and cooperation provided to our staff 

during the audit. If you wish to discuss this report, you may 

contact me at (202) 927-5904. 

Thomas E. Byrnes 

Director, Procurement Audits 
Appendix 1 

Objective, Scope, and Methodology 

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The overall objective of this audit was to assess contract and other 

costs charged to the Treasury Building and Annex Repair and 

Restoration (TBARR) Program appropriation accounts. 

We analyzed the internal control and control activities over the 

TBARR payment process, including segregation of duties, proper 

execution of transactions and events, accurate and timely 

recording of transactions and events, accountability for resources 

and records, and appropriate documentation of transactions and 

internal control. To accomplish this task, we did the following: 

a. Reviewed available Office of Financial Management’s (OFM) 

flow diagrams and procedures for processing TBARR 

payments. 

b. Interviewed OFM budget analysts to obtain an understanding 

of the financial plans, budget execution, and funds 

certification processes. 

c. Interviewed the OFM Chief of Vendor Resources, OFM 

accounting and payroll technicians, payment approving 

officials, and financial specialists to determine the 

procedures for processing invoices and Intragovernmental

Payment and Collection, payroll, and adjustment 

transactions. 

d. Reviewed contract files and credit card documents and 

payroll files, as applicable, from the TBARR Program and 

Facilities Management Division offices. 

We sampled TBARR transactions to determine whether they were 

authorized, accurate, supported, properly recorded, made for the 

purposes intended for the project, and charged to the appropriate 

TBARR appropriations accounts. Specifically, we reviewed 60 

transactions from fiscal years 1995 through 2005. We selected 

two samples. First, we selected 181 transactions totaling 

$15,280,632. From this sample we reviewed 60 transactions 

totaling $5,197,118 for our initial review. Since we did not find 

any significant exceptions, we decided to conclude our review of 

the first 60 sample transactions. We also selected 55 payments 

sent to 11 contractors where the costs were split between TBARR 
Appendix 1 

Objective, Scope, and Methodology 

GENERAL MANAGEMENT: Few Exceptions Found With TBARR Payments Page 9 

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and other Department Offices appropriations accounts. We 

selected low and high-dollar transactions to review for this stage of 

our audit. 

For the selected transactions, we requested original supporting 

documentation (i.e. invoices, purchase orders, contracts, receiving 

documentation, voucher schedule detail reports, payroll transaction 

reports, budget reports, general ledger document schedule reports, 

and other applicable reports from the accounting systems). We 

performed the following tests: 

a. Determined if the payments represented goods or services 

received; 

b. Verified whether the payment transactions were accurate as 

to terms, quantities, prices, and extensions (verified the 

mathematically accuracy of the invoices and supporting 

documentation); 

c. Verified whether the payments were made in accordance 

with the Prompt Payment Act; 

d. Traced account distribution on the contract, purchase order, 

and payment documentation to the Chart of Budget Object 

and Sub Object classes and verified proper classifications; 

e. Tested for duplicate payments; 

f. Analyzed the documentation maintained by OFM and the 

program offices (TBARR and the Facilities Management 

Division); 

g. Determined that federal monies were spent for the purposes 

and within the time periods set by Congress, to prevent 

obligations expenditures, or disbursements in excess of the 

appropriations or budget authority approved by Congress; 

and 

h. Reviewed contract files. 
Appendix 1 

Objective, Scope, and Methodology 

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For 20 of the 115 transactions we reviewed, totaling 

approximately $656,000, OFM was not able to provide us original 

documentation to support the payments. We applied alternative 

procedures to satisfy ourselves that the payments were proper. 

We performed our audit fieldwork at Treasury’s Departmental 

Offices in Washington, D.C., from November 2005 through 

November 2006. We performed the audit in accordance with 

generally accepted government auditing standards. 
Appendix 2 

Management Response 

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Appendix 3 

Report Distribution 

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Department of the Treasury

Acting Assistant Secretary for Management 

Acting Chief Financial Officer 

Assistant Secretary for Legislative Affairs 

Acting Director, Office of Financial Management 

Director, Office of Accounting and Internal Controls 

Office of Management and Budget

OIG Budget Examiner