U.S. Securities and Exchange Commission

Management Report to Accompany 

the Office of Inspector General 

Semiannual Report to Congress 

for the period April 1, 2021 through September 30, 2021

November 2021
 1

U.S. SECURITIES AND EXCHANGE COMMISSION

Management Report to Accompany the 

Office of Inspector General Semiannual Report to Congress

April 1, 2021 – September 30, 2021

Section 5(b) of the Inspector General Act of 1978, as amended, requires the Commission to transmit 

to the appropriate committees or subcommittees of the U.S. Congress a Management Report, 

containing certain statistical tables and any comments deemed appropriate, to accompany the Office 

of Inspector General’s (OIG’s) Semiannual Report. This Management Report presents the required 

information for the reporting period of April 1, 2021 through September 30, 2021. 

I. Overview of SEC Audit Follow-up Activities 

The SEC is committed to timely completion of corrective actions on OIG audit recommendations. At 

the commencement of this semiannual reporting period, there were 57 open OIG recommendations. 

During the period, management succeeded in obtaining OIG concurrence to close 24

recommendations. Of the 24 closed recommendations, management submitted 11 (or 46 percent) 

completed corrective actions to OIG for review and concurrence to close in less than one year. The 

SEC also received 2 new OIG reports during the reporting period containing a total of 11

recommendations for improvement to the agency’s processes and programs. At period-end, final 

action was pending on 44 recommendations from 13 reports. 4 recommendations were pending 

OIG concurrence for closure.

II. Reports with Monetary Savings

Sections 5(b)(2) and (3) of the Inspector General Act require the SEC Management Report to include 

statistical tables summarizing the progress that the agency has made in responding to audit, 

inspection, and evaluation reports containing “disallowed costs” and “recommendations that funds 

be put to better use.”

Disallowed Costs. The term “disallowed costs” means a questioned cost that management, in a 

management decision, has sustained or agreed should not be charged to the agency. For OIG reports 

that contain questioned or unsupported costs, SEC management will review the facts and determine 

whether such costs, and the extent to which, should be disallowed. If the SEC agrees that such costs 

should be disallowed, the agency will then evaluate whether to attempt to recover such costs. 

During the reporting period, OIG did not issue a report that contained any questioned or 

unsupported costs. In addition, there are no outstanding management decisions on questioned or 

unsupported costs identified in OIG reports issued prior to the reporting period. 

 
 2

Table 1. Status of Final Action on Audit, Inspection and Evaluation Reports 

with Disallowed Costs

(Reporting Period April 1, 2021 through September 30, 2021) 

Audit, Inspection and Evaluation Reports Number of 

Reports

Dollar Value of 

Disallowed Costs

A. For which final action had not been taken by the beginning of the reporting period 0 $0

B. On which management decisions were made during the reporting period 0 $0

C. For which final action was taken during the reporting period 0 $0

(i) Dollar value of disallowed costs that were recovered through collection, offsets, 

property in lieu of cash, or otherwise $0 

(ii) Dollar value of disallowed costs that were written off by management $0

D. For which no final action has been taken by the end of the period 0 $0

Recommendation that Funds be Put to Better Use. The term “recommendation that funds be put to 

better use” means a recommendation that funds could be used more efficiently if management took 

actions to implement and complete the accompanying recommendation. For OIG reports that 

contain recommendations that funds be put to better use, SEC management will review the facts 

and determine whether to implement such recommendations. 

During the reporting period, OIG did not issue a report that contained a recommendation that funds be 

put to better use as reflected in Table 2. 

Table 2. Status of Final Action on Audit, Inspection and Evaluation Reports 

with Funds Put to Better Use

(Reporting Period April 1, 2021 through September 30, 2021) 

Audit, Inspection and Evaluation Reports Number of 

Reports

Dollar Value of 

Funds Put to 

Better Use

A. For which final action had not been taken by the beginning of the reporting period 0 $0

B. On which management decisions were made during the reporting period 0 $0

C. For which final action was taken during the reporting period 0 $0

(i) Dollar value of recommendations that were actually completed 0 $0

(ii) Dollar value of recommendations that management has subsequently concluded 

should not or could not be implemented or completed 0 $0 

D. For which no final action has been taken by the end of the reporting period 0 $0

III. Reports on Instances of Whistleblower Retaliation

Section 5(b)(4) of the Inspector General Act, as amended, requires the SEC Management Report to 

include a statement with respect to any settlement agreement entered into by the agency with an 

official found by the Inspector General to have engaged in retaliation against a whistleblower. The SEC 

has no such settlement agreements to report. 
 3

IV. Reports More than One Year Old with Pending Corrective Action

Section 5(b)(5) of the Inspector General Act, as amended, requires the SEC Management

Report to include a statement with respect to audit reports on which management decisions have 

been made but final action has not been taken, other than audit reports on which a management 

decision was made within the preceding year. Table 3 presents the required information.

Table 3. Audits and Other Reports More than One Year Old 

(Reporting Period April 1, 2021 through September 30, 2021) 

Report No./Title Report Date Funds Put to 

Better Use 

Disallowed 

Costs Status of Final Action

Report 546: Audit of 

SEC's Compliance with 

the Federal 

Information Security 

Modernization Act for 

Fiscal Year 2017 

3/30/2018 $0 $0 16 of the report’s 20 recommendations have been 

closed with OIG’s concurrence. Corrective actions 

addressing one additional recommendation are 

complete and the closure memo is with the OIG 

for its review. Since the last reporting period, the 

SEC’s Office of Information Technology (OIT) 

reports it has made substantial progress in 

addressing the remaining recommendations, and 

is currently working to finalize revisions to policies 

and procedures to address the remaining 

elements. OIT anticipates completing corrective 

actions for two recommendations by the end of 

calendar year 2021 and two recommendations in 

Spring 2022.

Report 549: The SEC 

Made Progress But 

Work Remains To 

Address Human Capital 

Management 

Challenges and Align 

With the Human 

Capital Framework

9/11/2018 $0 $0 Eight of the report’s nine recommendations have 

been closed with OIG’s concurrence. The SEC’s 

Office of Human Resources continues to work on 

the remaining recommendation, with anticipated 

completion by the end of June 2022. 

Report 552: Fiscal Year 

2018 Independent 

Evaluation of SEC’s 

Implementation of the 

Federal Information 

Security Modernization 

Act of 2014

12/17/2018 $0 $0 Eight of the report’s 11 recommendations have 

been closed with OIG’s concurrence. OIT 

anticipates completion of corrective actions on two 

recommendations prior to the end of the next 

reporting period. Due to contracting and 

technology deployment requirements, the 

anticipated completion date for corrective actions 

related to the final open recommendation is the 

end of calendar year 2022. 

Report 556: The SEC 

Can More Strategically 

and Securely Plan, 

Manage, and 

Implement Cloud 

Computing Services

11/7/2019 $0 $0 One of the report’s three recommendations is 

closed with OIG concurrence. Corrective actions for 

the remaining two recommendations is complete 

and OIT is developing closure memos which it 

plans to submit for OIG’s consideration in the 

coming months. 

Report 558: Fiscal Year 

2019 Independent 

Evaluation of SEC's 

Implementation of the 

Federal Information 

Security Modernization 

Act of 2014

12/18/2019 $0 $0 Five of the nine recommendations have been 

closed with OIG concurrence. SEC completed 

corrective actions and requested closure for one 

additional recommendation. Corrective actions 

addressing the remaining three recommendations 

are in progress, and OIT anticipates completion in 

Spring 2022.

Report 559: The SEC's 

Office of Broker-Dealer 

Finances Provides 

Effective Oversight, But 

Opportunities To 

Improve Efficiency Exist

2/26/2020 $0 $0 Two of the three recommendations have been 

closed with OIG concurrence. TM anticipates 

completion of corrective actions by the end of 

calendar year 2022. 
 4

Report No./Title Report Date Funds Put to 

Better Use 

Disallowed 

Costs Status of Final Action

Report 562: 

Opportunities Exist To 

Improve the SEC's 

Management of Mobile 

Devices and Services

9/30/2020 $0 $0 Three of the seven recommendations have been 

closed with OIG concurrence. Corrective actions 

addressing the remaining four recommendations 

are in progress, and OIT anticipates completion in 

Spring 2022.