PROTECTING THE PUBLIC: 


Bureau of Alcohol, Tobacco and Firearms' 


Compliance Inspections Effectively Targeted 


Firearms Violators 


I OK(414911 February 8,2001 

This report has been reviewed for public dissemination by the Office of Counsel to 

the Inspector GeneraL Information requiring protection from public dissemination 

has been redacted from this report in accordancewith the Freedom of Information 

Act, 5 U.S.C. section 552. 

Office of Inspector General

-


The Department of the Treasury 
Contents 

Audit Report ................................................................................................. 2 

Results in Brief ............................................................................................ 2 

Background ................................................................................................. 4 

Findings and Recommendations ..................................................................... 5 

Field Offices Need Additional Guidance on Priority of Inspections .................. 5 

Recommendations ................................................................................... 8 

Field Offices Did Not Consistently Use N-Spect Reports .............................. 9 

Recommendation ................................................................................... I0 

Performance Measures Need To Be Enhanced........................................ 10 

Recommendation.................................................................................... 12 

Appendices 

Appendix 1: Objectives. Scope. and Methodology ...................................... 14 

Appendix 2: Management Comments ....................................................... 16 

~~~endix 3 Major Contributors to this Report ........................................... 22

Appendix 4 Report Distribution ............................................................... 23 

Abbreviations 

Activity Report N-Spect Report of Inspection Hours and Expenses by Unique 

Identifier 

ATF Bureau of Alcohol. Tobacco and Firearms 

Dl0 Director of Industry Operations 


FFL Federal Firearms Licensee 


FY Fiscal Year 


GCA Gun Control Act of 1968 


GPRA Government Performance and Results Act of 1993 


OIG Office of Inspector General 


Compliance lnspections Targeted Firearms Violators (016-01-038) Page 1 
Audit OIG Report 

The Department of the Treasury 

Office of Inspector General 

February 8, 2001 

Bradley A. Buckles 


Director 


Bureau of Alcohol, Tobacco and Firearms 


The Gun Control Act of 1968 (GCA) established the first 


comprehensive Federal licensing system for importers, 


manufacturers, and dealers in firearms to the retail level. The 


Bureau of Alcohol, Tobacco and Firearms (ATF) is responsible for 


enforcing the licensing provisions of the GCA, which requires the 


Federal Firearms Licensee (FFL) to maintain detailed records. Once 


a license is issued, ATF may inspect an FFL's inventory and 


records without warrant to ensure compliance with recordkeeping 


requirements of the GCA. Since 1986, however, the law has 


limited ATF to one such inspection during a 12-month period, 


absent consent of the licensee. 


We conducted the audit because Congress and the Administration 


continue to emphasize the effective regulation and control over 


firearms. The overall objective of this review was to determine the 


effectiveness of ATF's efforts in targeting the most frequent 


violators of gun laws and sources of crime guns. The audit 


fieldwork was performed from May to November 2000. We 


conducted fieldwork at Headquarters and three field offices, where 


we interviewed ATF officials, evaluated records and procedures, 


and participated in a compliance inspection. We also conducted a 


telephone survey of Directors of Industry Operations 
(DIO) across

the country. The scope of this review covered Fiscal Year 


(PI)1999 and FY 2000 (first six months). See Appendix 1 for a 


more detailed description of the audit objectives, scope, and 


methodology. 


Results in Brief 

Our review showed that ATF targeted the worst violators of gun 

laws and sources of crime guns. Its national initiatives, such as 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 2 
the Focused lnspection Program and the recently completed 

Commerce in Firearms Initiative, were designed to address these 

concerns. ATF was also taking appropriate administrative action 

based on violations disclosed during firearms compliance 

inspections. 

Our audit results indicated, however, that there were some areas 

that management officials could address to further improve their 

program. First, fie1 

inspection prioritie 

ect Report of lnspection Hours 

and Expenses by Unique Identifier (Activity Report) containing 

inspector hours and expenses in monitoring inspector activity. 

Finally, ATF has not developed specific performance measures that 

show the impact of firearms compliance inspection activities on 

reducing violent crimes. 

To address these issues, we made four recommendations in this 

reoort. The ATF Director should ensure that Headauarters officials 

. . 

balance of inspections The ATF Director 

should also determine eport is a beneficial 

management tool for the field offices in evaluating inspector

performance, and if so, he should issue a directive requiring its 

proper use. Lastly, performance measures should be developed to 

measure the impact compliance inspection activities have on 

reducing violent crimes. 

ATF agreed with the three findings and four recommendations 

made in this report. As a result, ATF has implemented a program 

manager position expressly to oversee the field planning process 

and to monitor the field's workload and priorities. Also, ATF has 

scheduled the release of a newer maintenance version of the NSpect system. Based on a work group review of all management 

reports, reports were either edited or totally rewritten to better 

meet both field and Headquarters supervisory needs. Lastly, ATF 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 3 
developed a specific performance measure to determine the impact 

of compliance inspections on violent crime. ATF's response to our 

draft audit report is provided as Appendix 2. 

Background 

Each year, about 4.5 million new firearms, including approximately 

2 million handguns, are sold in the United States. An estimated 

2 million secondhand firearms are sold each year as well. Part of 

ATF's mission is to prevent diversion of these firearms from the 

legal to the illegal market, and to keep them out of the hands of 

criminals, unauthorized juveniles, and other prohibited persons 

under the GCA. In 2000, there were 104,070 FFLs in the country. 

In October 1998, ATF initiated the current inspection policy, 

referred to as focused inspections. lnspections are selected on the 

basis of greatest potential at achieving established performance 

measures. The primary selection criteria come from the ATF Crime 

Gun Analysis Branch's semi-annual (JanuarylJune) analysis of all 

FFLs. The Branch's information includes the: 

number of crime guns traced to a FFL in a one year time frame, 

time-to-crime, 

number of reported stolen firearms, 

types of firearms involved, 

origination of the trace requests, and 

0 number of unsuccessful traces associated with a particular FFL. 

As a result of its Commerce in Firearms in the United States Report 

(February 2000). ATF devised the Commerce in Firearms Initiative. 

As part of this program, ATF sent demand letters to FFLs who had 

been uncooperative in response to trace requests, requiring the 

submission of all their firearms transaction records for the previous 

three years. Demand letters requiring information about used guns 

acquired for sale were also sent to FFLs who had traced to them 

Compliance InspectionsTargeted Firearms Violators (016-01-038) Page 4 
10 or more guns that were found to have had a time-to-crime of 


three years or less. In addition, ATF conducted comprehensive 


compliance inspections of dealers who had been uncooperative in 


response to trace requests and of FFLs who had 10 or more crime 


guns (irrespective of time-to-crime) traced to them in 1999. 


In its Report to the Secretary on Firearms Initiatives (Draft 


October 20001, ATF reported that 1,012 focused inspections were 


completed during their Commerce in Firearms Initiative, 3,338 


violations of firearms laws and regulations were identified, and a 


total of 484,122 firearms were in the inventories of the targeted 


Findings and Recommendations 

Finding 1 	 Field Offices Need Additional Guidance on Priority of 

lnspections 

-

ATF Headquarters establishes inspection targets for field offices 

each year, and provides guidance-on identifying areas that take 

Compliance Inspections Targeted Fireanns.Violaton (010-01-038) Page 5 
. . 

Field offices face competing priorities for their inspection resources 

with Headquarters establishing inspection targets'each year, and 

field offices initiating their own projects. For FY 2000, 

Headquarters officials issued memos changing the inspection 

targets as indicated in Table 1. 

encompass FFLs that have certain characteristics that 


may indicate the potential for compromising the 


integrity of commerce in firearms. 


All FFLs with FY 1999 inspections that resulted in 


administrative actions, identified a large number of 


record-keeping violations, identified a large number of 


missing inventory, and had a high number of firearms 


trafficking indicators. 


Specific FFLs who had been uncooperative in 


responding to traces and had more than 
10 crime

guns traced to them in 1999 (Commerce in Firearms 


Initiative). 


inspect the worst violators of Federal gun laws. In addition to the 

Firearms in Commerce Initiative started by ATF Headquarters, there 

were two projects initiated by the Field Division Director 

-

and one 

project in conjunction with the local police department. 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 6 
During our review, we found that more hours on average were 

required to complete an inspection in this office than in the other 

offices we visited. The FFLs had large firearm inventories, a high 

ATF's policy is that, while honest errors should not be a basis for 

revocation, licensees who are unable or unwilling to meet their 

obligations cannot be allowed to continue in the business. 

Inspectors are to take administrative actions against FFLs who 

commit willful violations of the GCA. Failure to com~lvDrovides an 

Headquarters provided guidance identifying areas that take 

precedence in the range of ATF responsibilities, including 

conducting focused compliance inspections of specific types of 

FFLs. ATF officials also stated that other goals and objectives 

Compliance Inspections Targeted Firearms Violators (016-01-0381 Page 7 
When implementing future directives, Headquarters officials should 

monitor resources and. when necessarv. ~rovideauidance on what 

Recommendations 

The ATF Director should ensure that Headquarters officials: 

2. 	

1. 

-

Monitor 

Provide additional 

the resources 

guidance 

available 

on allocating 

in field offices

resources 

I 

to field 

offices when initiating new irispection programs to ensure they 

complete a proper balance of inspections4-! 

Manaaement Comments 

ATF concurred with the audit findings and recommendations. 

ATF's Field Management Staff has implemented a program 

manager position expressly to oversee the field planning process 

and to monitor the field's workload and priorities. Under 

separate cover, we learned that the program manager position 

was effective October 22, 2000. 

010 Comment 

We consider this recommendation to have a management 

decision with final action completed. 

Compliance Inspections Targeted Firearms Violators 1010-01-038) Page 8 
Finding 2 Field Offices Did Not Consistently Use N-Spect Reports 

The field office management did not consistently use the Activity 

Report as a performance measure of inspector activity. The 

Activity Report is a management tool, which is available to field 

office management to evaluate inspectors. Without using this 

report, field offices may not be taking full advantage of all N-Spect 

offers. Headquarters had not issued any directives requiring field 

office use of this report to monitor inspector performance or 

explaining its benefits to field offices. 

N-Spect, an inspection management system supporting regulatory 

enforcement operations, is designed to reduce the administrative 

burden on ATF inspectors. Information is entered once and can be 

used in multiple areas of the system. The Activity Report identifies 

the FFL, the inspector assigned to the inspection, the dates the 

inspection opened and closed, and the total time and expenses 

associated with the inspection. The inspector time and expenses 

shown on the Activity Report are based on the information 

provided by the inspectors in the lnspector Diary screen in N-Spect. 

The lnspector Diary enables inspectors to capture time and 

expense information on a daily basis. Diary information can be 

summarized for inspection management statistics and on ATF 

travel vouchers. 

N-Spect generates 13 management reports that can be used by the 

field offices. Headquarters does not specifically require the 

Activity Report be used. It is a management tool available to the 

field offices. N-Spect is a new system and, as the field offices 

become more familiar with its capabilities, it is important that they 

develop consistency in its use. 

Field offices use the Operating Plan, in part, to determine their 

inspection schedule for the fiscal year based on the types of 

inspections identified in the plan and total hours available for 

inspections. Field office performance can be measured by 

comparing the number of completed inspections to the number 

identified in the Operating Plan. In monitoring inspector 

performance, we noted differences between the three field offices 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 9 
we visited. Two DlOs relied mainly on the number of completed 

inspections, either as a part of the field office Operating Plan or 

through program directives from Headquarters. The other Dl0 was 

using the Activity Report to monitor inspector performance. 

Recommendation 

We recommend that the ATF Director: 

1. 	Determine whether the Activity Report is beneficial to field 

office management in evaluating inspector performance. If the 

report is beneficial, issue a directive requiring the proper use of 

the Activity Report. 

Manaaement Comments 

ATF concurred with the finding and recommendation. ATF 

commented that Field supervisors had experienced technical 

difficulties in using the N-Spect system, due to certain coding 

inaccuracies, which caused its inconsistent use. To address 

this problem, the N-FOCIS Program Office is scheduled to 

release a newer maintenance version of the N-Spect system. 

ATF also had a work group review all the Management Reports. 

Based on their review, reports were either edited or totally 

rewritten to better meet both field and Headquarters supervisory 

needs. When the improvements to N-Spect are completed, the 

Office of Field Operations will clarify and confirm the 

requirement and value of the use of N-Spect Activity Reports to 

all managers and supervisors. 

OIG Comment 

We consider this recommendation to have a management 

decision with a projected final action date of late spring 2001 

Finding 3 Performance Measures Need To Be Enhanced 

ATF has not developed specific performance measures for firearms 

compliance inspection activities as required by the Government 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 10 
Performance and Results Act of 1993 (GPRA). Consequently, ATF €

is not able to demonstrate the effectiveness of its firearms €

compliance inspections activities. While ATF officials use various €

methods to evaluate their activities, they have found it difficult to €

quantify the impact of compliance inspections on reducing violent €

crime. €

GPRA requires each agency to prepare an annual performance plan €

covering each program activity set forth in the agency's budget. €

The plan shall establish performance goals to define the level of €

performance to.be achieved. The plan should express such goals €

in an objective, quantifiable, and measurable form. It should €

establish performance indicators to be used in measuring or €

assessing the relevant outputs, service levels, and outcomes of €

each program activity. It should also provide a basis for comparing €

actual program results with the established performance goals. €

Lastly, the plan should describe the means to be used to verify and €

validate measured values. GPRA's intent is to hold agencies €

accountable less for inputs and outputs and more for outcomes. €

By outcomes, GPRA meant the results of government programs as €

measured by the differences they make, for example, in the lives of €

the citizens. €

ATF's FY 2000 Budget Submission included FFL inspections in its €

definition of the performance measures it would be reporting on in €

future submissions. However, the FY 2001 Budget Submission no €

longer identified FFL inspections in its performance measures €

definitions. The Director of Strategic Planning commented that €

ATF does not gauge effectiveness of their inspections. It is €

assumed they are effective, but this has not been quantified. The €

field offices use the number of inspections as their primary method €

of performance measures. If they complete a project or initiative €

requested by Headquarters, this is considered a successful €

performance measure. €

In its Report to the Secretary on Firearms Initiatives (Draft €

October 20001, ATF notes various statistical information on their €

Commerce in Firearms Initiative. Statistical information reported €

includes the number of inspections completed, number of traces, €

types of violations, inventory discrepancies, multiple saleslreferrals, €

Compliance Inspections Targeted Firearms Violators 1016-01-038) Page 11 
and recommended actions. While this type of information is 

valuable in demonstrating what ATF has done, ATF needs resultsoriented performance measures, which reflect the activities' actual 

impact. 

Program offices started to take a serious look at performance 

measures in 1997 with the current measures still under review by 

the Program office. N-Spect performance measure worksheets 

include information on the results of the inspection, such as the 

size of firearms inventory, number of violations noted, and the 

number of unreported multiple sales in a given inspection. The 

performance information recorded in N-Spect effectively 

demonstrates inspection results. However, ATF has not yet been 

able to quantify the effectiveness of inspections. Because of the 

difficulty in quantifying inspection results, ATF has requested funds 

for compliance effectiveness studies, but these requests have not 

been included in the final budget proposal. 

Recommendation 

We recommend that the ATF Director ensure: 

1. 	Performance measures are developed to measure the impact 

compliance inspection activities have on reducing violent 

crimes. 

Manaaement Comments 

ATF concurred with the audit finding and recommendation. To 

address this issue, ATF held a seminar on performance 

measures for all Bureau Headquarters program personnel, which 

focused on the development of performance measures and 

measurement skills and techniques. As a result, the Firearms 

Trafficking Branch has developed and published a specific 

performance measure to determine the impact of compliance 

inspections on violent crime. The average number of violations 

cited during recall inspections will be compared to previous 

violations found to measure the increase (or decrease) in the 

level of compliance. ATF stated they would continue to 

develop and examine goals and define additional performance 

Compliance Inspections Targeted Firearms Violators (010-01-0381 Page 12 
measures relative to the impact of compliance inspection 

activities. The goal is to establish performance measures by 

mid-year and to continue to redefine and refine the measures 

yearly. 

OIG Comment 

We consider this recommendation to have a management 

decision with a projected final action date of mid-year 2001. 

We appreciate the cooperation we received from ATF officials 

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

contact me at (312) 886-6300, ext. 118. Major contributors to 

this report are listed in Appendix 3. 

z'wkL4 +.Af 

Roberta ~ ~ N. Rickev

Regional Inspector General for Audit 

Compliance Inspections Targeted Firearms Violators (016-01-038) Page 13 
Appendix 1 


Objectives, Scope, and Methodology 


We conducted this review because ATF initiated a focused 

inspection policy, as well as the Firearms in Commerce Initiative, 

which required field division personnel to select licensees for 

inspection based on a range of indicators of potential firearms 

traffickers derived from the National Tracing Center database. 

Congress and the Administration continue to emphasize the 

effective regulation and control over firearms. 

Our overall objective was to determine the effectiveness of ATF's 

efforts in targeting the most frequent violators of gun laws and 

sources of crime guns. Our specific objectives were to determine 

whether: 

Firearms compliance inspections were in accordance with ATF 

inspection strategies and other guidance provided by 

Headquarters, 

ATF was taking appropriate action when violations are found 

during firearms compliance inspections, and 

ATF developed adequate performance measures for firearms 

compliance inspections and whether those performance 

measurements comply with the Government Performance 

Results Act. 

Our review generally covered inspection activities at ATF field 

offices from October 1998 through March 2000. To accomplish 

our review, we conducted work at ATF Headquarters in 

Washington, D.C., where we interviewed officials and other 

employees in the: (1) Office of Firearms, Explosives and Arson, 

(2) Strategic Planning Office, and (3) Crime Gun Analysis Branch. 

We reviewed policies, procedures, and records related to: (a) the

focused inspection strategy, (b) administrative actions, (c) the 

Firearms in Commerce Initiative, (d) performance measures, and 

(e) ATF's inspection management system (N-Spect). 

We also visited ATF field offices in Chicago, Miami, and Nashville, 

where we interviewed ATF supervisors and inspectors, and 

reviewed ATF completed compliance inspection files. We observed 

Compliance InspectionsTargeted Firearms Violators (016-07-038) Page 14 

0 
Appendix 1 


Objectives, Scope, and Methodology €

N-Spect's use in the field, participated in an inspection of a FFL, 

and we conducted a telephone survey with DlOs in selected field 

divisions. 

We conducted our audit between May 2000 and November 2000 

in accordance with generally accepted government auditing 

standards. 

Compliance Inspections Targeted Firearms Violators 1010-01-038) Page 15 
Appendix 2 

Management Comments 

DEPARTMENT OF THE TREASURY 

BUREAUOF&LCOHOL,TOQACCOANDFIREARMS 

WASHINGTON,DC 20226 


DIRECTOR 

JAN 2 4 2001 903010:mc 

8100 

MEMORANDUM TO: Assistant Inspector General for Audit 


FROM: Director 


SUBJECT: 	Review of Draft Audit Report on the 


Bureau's Firearms Inspection Program 


We have received the draft of the subject audit report and 


appreciate the opportunity to review and provide comments. 


Our comments. which follow, address the report's three 


findings and four recommendations. 


FINDING 1 (Field Offices Need Additional Guidance on 

Priority of Inspections) recommends ATF Headquarters 

officials should (1) monitor the resources available in 

field offices 4 ) (2) . provide additional guidance on allocating resources to 

field offices when initiating- new insDection - -

~roarams - to

-

ensure they complete a proper balance of inspections, 


Ccmments On Pindinus or Reasons for Disasreement 


Without disputing the Inspector General's (IG) finding that 


additional field guidance would improve ATF's Firearms 


Inspection Program, we would point out that the Office of 


Field Operations (FO) continually refines the guidance 


provided to the Division Directors (DD) each fiscal year. 


Using the established field planning process, Headquarters 


officials get input from the DDs, and provide field program 


guidance each fiscal year for use ih preparing each field 


division's operating plan. This guidance is published in 


the form of a memorandum, with attachments as appropriate, 


that identifies and defines Bureau project codes and 


provides minimum requirements for the various program 


areas. Those requirements are based on the DDs' 


recommendations as to the personnel and other resources 


available in their divisions. 


Compliance Inspections Targeted Firearms Violators ~01G:01-038l Page 16 
Appendix 2 

Management Comments 

-2-


Assistant Inspector General For Audit 


Prior to conducting the referenced Focused Inspection 


Program and throughout the conduct of the project, 


including ATF's regulatory initiative involving demand 


letters, Headquarters provided guidance to field offices 


through a variety of methods including memoranda, e-mail 


and TECS messages. This information was provided to the IG 


review team prior to the start of the review. In addition, 


Fireans Programs Division continually monitored the 


progress of the demand letter initiative, which was a 


component of ATF's overall focused inspection program, and 


provided monthly updates to the Under Secretary 


(Enforcement). 

Prlor to receiving a copy of this review, Headquarters 


managers responsible for Firearms Programs and Field 


Operations began the process of review and coordination of 


programs and priorities for the remainder of this fiscal 


year, and for FY-02. These meetings included discussions 


regarding how to better coordinate and prioritize programs 


and operations before and during any inspection 


initiatives, and how to clearly communicate revisions to 


the field. This has resulted in a renewed commitment by 


all parties to more closely monitor the demand placed by 


program activities on field resources. Additionally, FO 


has implemented a program manager position expressly to 


oversee the field planning process and to monitor the, 


field's workload and priorities. As a result, the affected 


directorates work more closely together in the development 


and implementation of future inspection initiatives. 


ATF is in the process of hiring 200 new inspectors. After 


these new hires receive mandated 
formal classroom and on

Compliance InspectionsTargeted Firearms Violators (016-01-038) Page 17 

I 
Appendix 2 


Management Comments 


Assistant Inspector General For Audit 


Finally, ATF's Director provides information annually to 


all managers and supervisors on ATE'S executive-level 


priorities for each fiscal year. In addition, each 


directorate identifies their own priorities for the fiscal 


year in a related document. ATF's FY-00 executive level 


and directorate priorities can be found on ATF's Intraweb 


under "Strategic Planning.'' 

Actions Taken 

A memorandum, dated August 8, 2000, and entitled "FY 2001 


Field Program Guidance," was issued to all DDs and 


Headquarters Division Chiefs. This memorandum outlines the 


N-01 operating plan priorities, including project codes 


and definitions and levels of inspections required in the 


various industries regulated by ATF. 


ATF's Office of Firearms, Explosives and Arson (FEA) and 


the Strategic Planning Office (SPO) published a memorandum, 


dated February 15, 2000, entitled "Office Minimum Field 


Requirements for 
FY-2001." This memorandum	summarized the

field requirements (priorities) for activities affecting 


FEA. 


ATF will continue to refine, publish, and provide 


executive-level and directorate priorities to all managers 


and supervisors for N-01. Further, revisions in 


priorities will be communicated clearly through the 


Assistant Director (Field Operations). 


Taruet Dates for Com~letion 

ATF will publish N-01 priorities by February 28, 2001. 


FINDING 2 (Field Offices Did Not Consistently Use N-Spect 

Reports) recommends (3) that ATF determine whether the 

Activity Report is beneficial to field office management in 

evaluating performance. If the report is beneficial, issue 

a directive requiring the proper use of the Activity 

Report. 

Compliance Inspections Targeted Firearms Violators 1016-01-038) Page 18 
Appendix 2 €

Management Comments €

Assistant Inspector General For Audit 


Comments Gn Findinas or Reasons for Disaureement 

ATF believes that the Activity Report segment of N-Spect is 


a beneficial tool and has placed the report within this 


database for that purpose. Headquarters managers and soy 


field offices use N-Spect reports to monitor field 


activities. However, we recognize that field supervisors 


have been experiencing technical difficulties in using the 


N-Spect system, due to certain coding inaccuracies. 


Utilization of N-Spect is inconsistent now, but improvement 


is expected. The system is currently under development, 


and receives enhancements with,eachnew phase or 


programming release. ATF is developing more training for 


N-Spect users and is endeavoring to make N-Spect user-


friendlier, and therefore more effective and reliable as a 


management tool. When the improvements to N-Spect are 


completed, FO will clarify and confirm the requirement and 


value of the use of N-Spect Activity Reports to all 


managers and supervisors. 


Actions Taken 

To address the current technical problems in the Report of 


Inspector Activity by PPC, the N-FOCIS Program Office is 


scheduled to release maintenance Version 1.3 soon. Testing 


began January 12, 2001. If no "bugs" are found, Version 


1.3 should be ready for release by the end of January. If 


bugs are identified they must be corrected and tested prior 


to release. 


A work group of five Area Supervisors from across the 


country came to Washington, DC, in November 2000 to review 


all of the Management Reports with the Field Management 


Staff, the N-FOCIS Program Office and Performance 


Engineering Corporation (PEC). Reports were either edited 


or totally rewritten to better.meet both field and 


Headquarters supervisory needs. The new reports will be in 


maintenance release Version 1.4, scheduled for early 


spring 2001. FO has assigned an N-Spect coordinator to 


oversee the development and troubleshoot for these new 


field reporting systems. 


Compliance Inspections Targeted Firearms Violators (016-01-038) Page 19 
Appendix 2 


Management Comments 


Assistant Inspector General PorAudit 


Funding for developing N-Spect (as well as N-Force) has 


suffered over the past two fiscal years as ATF has labored 


to install financial systems that meet the Chief Financial 


Officer Act mandate for cost accounting. The Financial 


Management Division is now able to track resource 


expenditures at the activity/program/project level as 


specified in our strategic plan. 


Target Dates for Completion 


The referenced updates to N-Spect can reasonably be 


expected to be completed by late spring 2001. Directives 


regarding the proper use of the reporting tool will follow 


as the N-FOCIS reporting system is completed. 


FINDING 3 (Perfozmance Measures Need To Be Enhanced) 

recommends (4) ATF develop performance measures to measure 

the impact compliance inspection activities have on 

reducing violent crime. 

Comments On Findinas or Reasons for Disaareeaent 


ATF is in the process of examining outcome measurements, 


which would reflect the impact of compliance inspections on 


reducing violent crime. The Offices of FO and FEA are 


working with the SPO to define and publish valid and useful 


performance measures. 


Actions Taken 


The ATF SPO held a seminar on performance measures for all 


Bureau Headquarters program personnel on January 17, 2001. 


The seminar focused on the development of performance 


measures and measurement skills and techniques. 


Per your recommendation, the Firearms Trafficking Branch 


(FTB)has developed and published a specific performance 


Compliance Inspections Targeted Firearms Violators IOIG-01-038) Page 20 
Appendix 2 


Management Comments 


Assistant Inspector General For Audit 


- ­

deveiop and examine goais.and define additional performance 


measures relative to the impact of compliance inspection 


activities. 


Taraet Dates for Cam~letion 


As stated, ATF is actively participating with the SPO to 


establish performance measures for all aspects, offices and 


activities of the Bureau. The goal is to establish 


performance measures by mid-year, and to continue to 


redefine and refine the measures yearly. 


We appreciate the time and careful attention your office 


has given to this important ATF program. Your work and the 


recommendations you provided will help us improve the 


management of ATF's Focused Inspection Program. We also 


appreciate the professionalism and courtesy of your staff. 


Should any additional information be needed, please contact 


Mr. Walfred A. Nelson, Deputy Assistant Director (Firearms, 


Explosives and Arson) at (202) 927-7940. 


Bradley A. Buckles 


Compliance Inspections Targeted Firearms Violators 1016-01-038) Page 21 
Appendix 3 €

Major Contributors to this Report €

Chicago Regional Office €

Roberta N. Rickey, Regional Inspector General for Audit €

Janice A. Miller, Audit Manager €

Lynn Richardson, Acting Audit Manager €

Bradley Mosher, Auditor €

Kathleen Hyland, Auditor €

Compliance Inspections Targeted FirearmsViolators (010-01-038) Page 22 €
Appendix 4 


Report Distribution 


US. Department of the Treasury 

Office of the Under Secretary of the Treasury for Enforcement 

Office of the Assistant Secretary of the Treasury for 

ManagementIChief Financial Officer 

Office of Accounting and Internal Control, Departmental Offices 

Office of Organizational Improvement, Departmental Offices 

Office of Strategic Planning & Evaluations, Departmental Offices 

Office of Budget, Departmental Offices 

Management Control Branch 

Bureau of Alcohol, Tobacco and Firearms 

Director 


Assistant Director, Office of Inspections 


Assistant Director, Liaison 
& Public Information

Assistant Director, Firearms, Explosives & Arson 


Assistant Director, Field Operations 


Assistant Director, Training & Professional Development 


Deputy Chief, Financial OfficerIFinancial Management Division 


Office of Management and Budget 

Treasury Bureau Chief 

Budget Examiner 

Compliance lnspections Targeted Firearms Violators (010-01-038) Page 23