U.S. OFFICE OF PERSONNEL MANAGErvlliNT 

OFFICE OF THE INSPECTOR GENERAL 

OFFICE OF AUDITS 

Final Audit Report 

Subject: 

AUDIT OF THE COURT ORDERED BENEFITS
 

BRANCH
 

Report No. 4A-RI-OO-IO-014 

Date: October 14, 2010 

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U ITED STATES OFFICE OF PERSONNEL MA AGEME T
 

Wa hington. DC 20415
 

Office of the 

In pector General 

AUDIT REPORT 

AUDIT OF THE COURT ORDERED BENEFITS BRANCH
 

WASHINGTON, D.C.
 

Report o. 4 -RJ-OO-IO-014 Dak: October 14, 2010 

gv~~ ichael R. E er 

Assistant In pector General 

for Audits 

www.opm.gov www.usajobs.gov 
UNITED STATES OFFICE OF PERSONNEL MANAGEMENT
 

Wa hington, DC 20415
 

Office of the 

Tn peetor General 

EXECUTIVES~Y

AUDIT OF THE COURT ORDERED BENEFITS BRANCH
 

WASHINGTON, D.C.
 

Report No. 4A-RI-OO-IO-014 Date: October 14, 2010 

The Office of the Inspector General has completed a performance audit ofthe Court Ordered 

Benefits Branch (COBB) of the Retirement and Benefits Office. Our main objective was to 

determine whether OPM's COBB has effective controls to process court ordered retirement 

benefits. In order to make this determination, our audit included the following specific 

objectives: (1) determine if COBB has effective controls to properly record and timely process 

court ordered payments for its customers; and (2) determine if COBB has an effective 

customer service program. 

Our audit was conducted from March 11,2010 through June 23, 2010 at the U.S. Office of 

Personnel Management's (OPM) headquarters in Washington D.C. Our audit identified three 

areas requiring improvement. 

A. Court Order Processing 

1.	 Inaccurate Court Order Status in Court Order Recording and Procedural 

Tracking System (CORTS) 

CaRTS inaccurately reported the status of 6,841 cases as
 

"pending."
 

2.	 Untimely Court Awarded Benefit Payment $5,757 

COBB did not tim ly process the court awarded benefit payment for 

2 of 82 court orders sampled. 

1 

www.opm.goY	 www.usajobs.goY 
B. Customer Service 

1. Inadequate Customer Service Procedural 

COBB's customer service unit is not held to the same performance 

standards as Retirement and Benefits, and its telephone system is 

not equipped to handle or adequately measure call volume and other 

performance measures. 

11 
TABLE OF CONTENTS 

EXECUTIVE SUMMARY . 

I. INTRODUCTION AND BACKGROUND . 

II. OBJECTIVES, SCOPE, AND METHODOLOGy........ 3
 

III. AUDIT FINDINGS AND RECOMMENDATIONS.. 5
 

A. Court Order Processing 

1. Inaccurate Status of Pending Court Orders in CORTS........... 5
 

2. Untimely Court Awarded Benefit Payment. ..... .. ..... ... ... ..... 6
 

B. Customer Service 

1. Inadequate Customer Service. . ... ............ ..... ..... ... ... ...... 8
 

IV. MAJOR CO TRIBUTORS TO THIS REPORT 10
 

APPENDIX (Retirement and Benefits response, dated August 19,2010, to our 

draft report) 
I. INTRODUCTION AND BACKGROUND
 

Introduction 

This final audit report details the findings, conclusions, and recommendations resulting from 

our performance audit of OPM's Court Ordered Benefits Branch (COBB) ofthe Retirement 

and Benefits Office. The audit was performed by OPM's Office of the Inspector General 

(OIG), as authorized by the Inspector General Act of 1978, as amended. 

Background 

COBB is r sponsible for processing post-adjudication court orders and employee court orders 

related to retirement benefits. COBB authorizes payments in accordance with clear, specific, 

and express provisions of court orders acceptable for processing under the applicable 

provisions oflaw and regulation. Ifthe order is not acceptable, the parties must return to State 

court to seek any necessary modifications. 

A court order can apportion or divide a Civil Service Retirement ystem (CSRS) or Federal 

Employees Retirement System (FERS) benefit as a result of a divorce, legal separation, or 

annulment of marriage. The court order must expressly direct aPM to pay a portion of the 

monthly CSRS or FERS benefits. The spouse's share must be stated as a fixed amount, a 

percentage or a fraction of the annuity, or by a formula whose value is readily apparent from 

the face of the order and information in OPM files. 5 CFR 838.231(a) states, "A court order 

acceptable for processing is effective against employee annuity accruing beginning the first 

day ofthe second month after aPM receives the court order." 

In order to provide good customer servic concerning the processing of court orders, a tracking 

system called Court Order Recording and Tracking System (CORTS) was developed and 

implemented in 1997. The Court Order Assignment Case Type report was developed to 

identify all court orders entered into the CORTS database that have a status recorded as 

"pending." The report provides COBB management an aging of pending court orders. The 

default for the order status field in CORTS is "P" for pending. Once COBB paralegals review 

the submitted court order documentation and approve the award of benefits, the paralegals 

should change the court order status in CORTS from "P" to "0" for open, meaning the court 

order has an award that is currently in force. 

The COBB customer service representatives are responsible for answering customer inquiries 

and questions received via the telephone, in written correspondence, and in person. Many of 

the phone calls and written correspondence ar received from employees, retirees, former 

spouses, and attorneys and pertain to status of the court order processing, clarification on 

documentation required to complete processing, and general questions regarding court order 

benefits and the law. COBB's customer service representatives also are responsible for 

entering all court order receipts and information into the tracking system for paralegal 

1
 
assignment. COBB's customer service unit has 4 phone lines with voicemail boxes that can 

hold approximately 55 messages each. 

When customers cannot get their inquiries resolved through COBB's customer service unit 

they normally send written inquiries to their Congressmen and/or the OPM Director. In fiscal 

year 2009, the Retirement and Benefits Special Inquiries Branch received approximately 532 

Congressional Inquiries and 60 Director Inquiries pertaining to COBB customer service. 

2
 
II. OBJECTIVES, SCOPE, D METHODOLOGY
 

Objectives 

The primary objective of our audit was to determine whether OPM's COBB has effective 

controls to process court ordered benefits. 

In order to achieve our primary objective, our audit included the following specific objectives: 

1.	 Determine if COBB has effective controls to properly record and timely process court 

ordered payments for its customers; and 

2.	 Determine if COBB has an effective customer service program. 

The recommendations included in this final report address these objectives. 

Scope and Methodology 

We conducted this performance audit in accordance with generally accepted government 

auditing standards as establish d by the Comptroller General ofthe United tates. Those 

standards required that we plan and perform the audit to obtain sufficient appropriate evidence 

to provide a reasonable basis for our findings and conclusions based on our audit objectives. 

W believe that the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. 

The scope ofour audit covered the Court Order Recording and Tracking System (CaRTS) 

universe of court orders as of February 4,2010. We also considered COBB's and the 

Retirement Operations' current customer service practices and performance standards. 

We performed this audit from March 11,2010 through June 23, 2010 at OPM headquarters in 

Washington, D.C. 

To accomplish the audit objectives noted above we: 

•	 Sampled completed court orders from CaRTS and tested the timeliness of court order 

processing from the initial date of receipt ofthe court order by COBB to initial 

payment; 

•	 Determined the reliability and completeness of data as recorded in CORTS; 

•	 Performed a match betwe n the annuity roll data file of court orders as the key 

identifier to identify court orders incorrectly identified as pending in CaRTS; and 

•	 Interviewed COBB and Retirement Operations Customer ervice Unit Managers. 

In planning our work and gaining an understanding of the internal controls over court ordered 

benefits, we considered the internal control structure to the extent necessary to develop our 

audit procedures. These procedures were mainly substantive in nature, although we did gain 

an understanding of management procedures and controls to the extent necessary to achieve 

3
 
our audit objectives. The purpose of our audit is not to provide an opinion on internal controls 

but merely to evaluate controls over the processes that were included in the scope of our audit. 

Our audit included such tests of COBB's records and the Retirement Operation's customer 

service performance management the Annuity Roll Processing ystem, retirement case files, 

and other procedures as we considered necessary under the circumstances. The results of our 

tests indicate that with respect to the items tested COBB has effective controls to ensure the 

processing of court ordered benefits and effective customer service, except for the areas set 

forth in the details of this audit report. 

In conducting our audit, we performed a computer match which identified 6 481 pending 

CORTS records with award payments to validate the match results between the CORTS data 

and the annuity roll. In addition, we randomly selected a sample of 82 out 0[75,198 CORTS 

pending and closed cases to assess the completeness and reliability of CORTS data and 

timeliness of processing. The results from our sample were not projected to the population. 

4
 
ID. AUDIT FINDINGS AND RECOMMENDATIONS
 

A. Court Order Proce ing 

1. Inaccurate Statu of Pending Court Orders in CORTS 

As of February 4,2010, the Court Ordered Benefits Branch's (COBB) Court Order 

Recording and Tracking System (CORTS) was inaccurately reporting the status of 6481 

records with court awarded benefits in force as pending. 

The default for the order status field in CORTS is "P" for pending. Once COBB paralegals 

review the submitted court order documentation and approve the award of benefits, the 

paralegals should change the court order status in CORTS from "P" to "0" for open, 

meaning the court order has an award that is currently in force. COBB uses a management 

report to identify an aging of court orders with a pending status. This management report 

identifies the workload of court orders with processing decisions that need to be made. 

We obtained two data files from the Benefits Systems Group (B G) to assist with our 

testing ofthe reliability of court order status as recorded in CORTS. One file identified all 

records from the annuity roll with payment actions that pertain to an award of court ordered 

benefits. The data for this file was run by BSG on January 29, 2010. The other file 

identified all records from the CORTS database with a "pending" status as of February 4, 

2010. Using our data analysis software, we performed a match between the two data files 

to identify the CORTS records with a "pending' status that have benefits payments made. 

The computer match revealed 6,481 pending CORTS records with court ordered benefits 

payments. We tested seven cases to validate the results from the computer match. Oill 

testing revealed that all seven cases were inaccillately recorded in CORTS as "pending. ' 

The General Accountability Office's (GAO) Standardfor Internal Control in the Federal 

Government, dated November 1999 states, "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.' 

COBB does not have a policy for the timely updating of court order status in CORTS. As a 

result, the management reports produced from CORTS are unreliable for COBB 

management to make effective workload decisions. 

Recommendation 1 

We recommend that COBB management review all 6,481 "pending' CORTS records with 

court ordered benefits identified in our computer match to ensure the rebability ofthe 

status in CORTS. 

5
 
Retirement and Benefits' Respon e: 

"Concur. COBB management submitted a 'Team Track' to Benefits Systems on 

August 18 2010 to automate this process. Benefits Systems will enhance the Court 

Ordered Records and Tracking Sub-System in ARP so that only actual pending court 

orders appear on the Court Order Assigrunent Case Type Report. This improvement will 

prevent court orders that have been completed from appearing on the report." 

Recommendation 2 

We recommend that COBB management develop and implement a policy to ensure that the 

court order status is updated timely to ensure accurate reporting in CORTS. 

Retirement and Benefits' Respon e: 

'Concur. See respon e to Recommendation 1. ' 

2. Untimely Court Awarded Benefit Payment 

COBB reviews the court order documentation submitted by retirees and determines if the 

court order can be approved for payment. If payment is approved, COBB will calculate the 

amount of the benefit payment based on the court order benefits requirements and will 

establish the initial payment to the benefit recipient. 5 CFR 838.231 (a) states, "A court 

order acceptable for processing is effective against employee annuity accruing beginning 

the first day of the second month after OPM receives the court order." 

Wejudgmentally selected 82 out of75,198 CaRTS pending and closed cases to assess the 

completeness and reliability of CORTS data and timeliness of processing. rom our 

review ofthe sample ofpending and closed court ordered benefits cases, we identified one 

instance where COBB did not timely process the court awarded benefit payment and no 

retroactive benefit payment was made. 

The court order was approved by COBB on May 3 1994 as indicated by the CaRTS 

record detail. The first payment should have been made on July 1, 1994. However the 

initial payment was made on ovember 1, 1994. We were unable to identify whether a 

retroactive payment was made to bring the benefit payment into compliance with 

regulations. The total underpayment of court ordered benefits to the award recipient is 

$3,621.20 ( 905.30 for four months July 1 1994 through October 31, 1994). 

6
 
In addition, through our case review, we identified a matter worthy of attention that was 

not part of our audit objectives. For one of the court order cases in our sample, a stop 

order was received on June 21, 2005 to terminate the court ordered benefit in July 2005. 

However, annuity deductions continued from the annuitant's monthly annuity payment for 

a period of three months (July, August, and September 2005) in the amount of $712 per 

month. The resulting excess annuity deduction totaled $2,136. 

Recommendation 3 

We recommend that COBB process and timely pay all court ordered benefits in accordance 

with 5 CFR 838.231(a). 

Retirement and Benefits' Response: 

Concur. And we note that the audit showed that 97.6% of the COUlt orders in the 

sample were processed timely. ' 

Recommendation 4 

We recommend that COBB review the facts of the case in question and determine if a 

retroactive payment of $3,621.20 is due to the fonner spouse. If an additional payment is 

due, we recommend that the additional payment be made as soon as possible. 

Retirement and Benefits' Response: 

"Concur. COBB has taken corrective action on the case in question. ' COBB's review of 

the facts of the case indicate that no retroactive payment is due because the annuitant has 

been paying the former spouse independently from an annuity deduction. 

Recommendation 5 

We recommend that COBB review the facts ofthe case in question to determine if a refund 

of $2,136 in excess deductions is due to the annuitant. 

Retirement and Benefits' Response: 

"Concur. COBB has taken corrective action on the case in question." COBB's review of 

the facts of the case concludes that a reimbursement of $2 13 6 is due to the annuitant. 

7
 
B. Customer Service 

1. Inadequate Customer Service 

COBB's customer service is inadequate to meet customer needs, and their customer service 

unit is not held to the same customer service performance standards as the Retirement 

Information Office (RIO), the Retirement Operations main customer service unit. In 

addition, COBB's customer service unit does not have the necessary tools to handle the call 

volume received or to adequately measure customer service performance. 

RIO customer service specialists are held to a standard of production to ensure good 

custom r service is provided and agency goals are met. The performance standards have 

four elements of evaluation: quantity, quality, time management, and 

professional/teamwork. 

The GAO's Standards for Internal Control in the Federal Government, dated November 

1999 states, "Managers also need to compare actual performance to planned or expected 

results throughout the organization and analyze significant differences .... Activities need to 

be established to monitor performance measures and indicators. These controls could call 

for comparisons and assessments relating different sets of data to one another so that 

analyses of the relationships can be made and appropriate actions taken." 

Without tools and measures to effectively monitor customer service performance, customer 

service suffers, resulting in a high number of Congressional and Director Inquiries, thereby 

negatively impacting OPM's image and relationship with Congress and the general public. 

Recommendation 6 

We recommend that Retirement Operations management develop and implement methods 

for evaluating COBB s customer service performance. 

Retirement and Benefits' Respon e: 

"Concur. COBB management will evaluate the current performance standards for 

their Customer Service Specialists to determine appropriate and value-added 

measurements." 

8
 
Recommendation 7 

We recommend that Retirement Operations management ensure that COBB s customer 

service representatives have tools and resources to effectively respond to inquiries. 

Retirement and Benefits' Response: 

"Concur. We note that OPM is scheduled to receive a new phone system in the fall 

of 20] 0, and we will maximize the use of new features in order to garner the greatest 

impact for responding to inquiries." 

9
 
••••••Senior Team Leader 

IV. MAJOR CO TRIBUTORS TO THIS REPORT 

Internal Audits Group 

Auditor 

Auditor-in-Charge 

Jr., Chief 

10
 
APPENDIX
 

UNITED STATES OFFICE OF PERSONNEL MANAGEMENT 

Washington, DC 20415 

Retirement and 

Benefits	 August 19,2010 

MEMORANDUM FOR
 

Chief, Internal Audits Group 

FROM:
 Chief 

Quality Assurance 

Retirement and Benefits 

SUBJECT:	 Draft Report on the Audit ofthe Court Ordered Benefits Branch 

Report No. 4A-RI-00-I0-01A 

The following is our confirmation of concurrence with both the findings and 

recommendations previously provided by the management ofCourt Ordered Benefits 

Branch (COBB), updated with the current status of any corrective actions. If you need 

any further information, please let us know. 

Response to Findings and Recommendations 

A. Court Order Processing 

1. Inaccurate Court Order Status in Court Order Recording and Tracking 

System (CORTS) 

CORTS inaccurately reported the status of 6,481 cases as "pending." 

Recommendation 1: 

We recommend that COBB management review all 6,481 "pending" CORTS 

records with court ordered benefits identified in our computer match to ensure the 

reliability of the status ofCORTS. 

R&B RESPONSE: Concur. COBB management submitted a "Team Track" to 

Benefits Systems on August 18,2010 to automate this process. Benefits Systems 

will enhance the Court Ordered Records and Tracking Sub-System in ARPS so 

that only actual pending court orders appear on the Court Order Assignment Case 

Type Report. This improvement will prevent court orders that have been 

completed from appearing on the report. 

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Recommendation 2: 

We recommend that COBB management develop and implement a policy to 

ensure that the court order status is updated timely to ensure accurate repOlting in 

CORTS. 

R&B RESPONSE: Concur. See response to Recommendation 1. 

2. Untimely Court Awarded Benefit Payment 

COBB did not timely process the court awarded benefit payment for 2 of 82 court
 

orders sampled.
 

Recommendation 3:
 

We recommend that COBB process and timely pay all court ordered benefits in
 

accordance with 5 CFR 838.231(a). 

R&B RESPO SE: Concur. And we not that the audit showed that 97.6% ofthe
 

court ord rs in the sample were processed timely.
 

Recommendation 4:
 

We recommend that COBB review the facts ofthe case in question and determine
 

if a retroactive payment is due to the former spouse. If an additional payment is 

due, we recomm nd that the additional payment be made as soon as possible. 

R&B RESPO SE: Concur. COBB has taken corrective action on the case in 

question. 

Recommendation 5: 

We recommend that COBB review the facts ofthe case in question to determine if 

a refund of excess deductions is due to the annuitant. 

R&B RESPONSE: Concur. COBB has taken corrective action on the case in 

question. 
B. Customer Service 

1. Inadequate Customer Service 

COBB's customer service unit is not held to the same performance standards as 

RIO, RO's main customer service unit, and the telephone system is not equipped 

to track call volume, and other performance measures. 

Recommendation 6: 

We recommend that Retirement Operations management develop and implement 

methods for evaluating COBB's customer service perfOImance. 

R&B RESPO SE: Concur. COBB management will evaluate the current 

performance standards for their Customer Service Specialists to determine 

appropriate and value-added measurements. 

Recommendation 7: 

We recommend that Retirement Operations manag ment ensure that COBB's 

customer service representatives have tools and resources to effectively respond 

to inquiries. 

R&B RESPO SE: Concur. We note that OPM is scheduled to receive a new 

phone system in the fall of2010, and we will maximize the use ofnew features in 

order to gamer the greatest impact for responding to inquiries. 

An additional note: the last paragraph on page 2 refers to the number of Congressional 

and Director inquiries received by the Special Inquiries Branch, and the percentage 

attributable to COBB customer service deficiencies. Please clari fy the universe is 

inquiries re: court ordered benefits in general vs. all Congressional and Director inquiries 

received.