U.S. GOVERNMENT PUBLISHING OFFICE

WASHINGTON : 

1 

79–010 

" ! SENATE 115TH CONGRESS

2d Session 

REPORT

2018

115–239 

Calendar No. 396 

GAO AUDIT MANDATES REVISION 

ACT OF 2018 

R E P O R T 

OF THE

COMMITTEE ON HOMELAND SECURITY AND 

GOVERNMENTAL AFFAIRS 

UNITED STATES SENATE 

TO ACCOMPANY

S. 2400 

TO ELIMINATE OR MODIFY CERTAIN AUDIT MANDATES OF THE 

GOVERNMENT ACCOUNTABILITY OFFICE 

MAY 7, 2018.—Ordered to be printed 


congress.#13
(II) 

COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS 

RON JOHNSON, Wisconsin, Chairman 

JOHN MCCAIN, Arizona 

ROB PORTMAN, Ohio 

RAND PAUL, Kentucky 

JAMES LANKFORD, Oklahoma 

MICHAEL B. ENZI, Wyoming 

JOHN HOEVEN, North Dakota 

STEVE DAINES, Montana 

CLAIRE MCCASKILL, Missouri 

THOMAS R. CARPER, Delaware 

HEIDI HEITKAMP, North Dakota 

GARY C. PETERS, Michigan 

MAGGIE HASSAN, New Hampshire 

KAMALA D. HARRIS, California 

DOUG JONES, Alabama 

CHRISTOPHER R. HIXON, Staff Director 

GABRIELLE D’ADAMO SINGER, Chief Counsel 

DANIEL J. SPINO, Research Assistant 

MARGARET E. DAUM, Minority Staff Director 

STACIA M. CARDILLE, Minority Chief Counsel 

CHARLES A. MOSKOWITZ, Minority Senior Legislative Counsel 

CHRISTOPHER J. MULKINS, Minority U.S. Government Accountability Office Detailee 

LAURA W. KILBRIDE, Chief Clerk 

1 Email from Timothy L. Minelli, Assistant Dir. of Cong. Relations, U.S. Gov’t Accountability 

Office, to Daniel Spino, Research Assistant, S. Comm. on Homeland Sec. & Governmental Affairs (Jan. 29, 2018, 01:15 EST) (on file with Committee). 

Calendar No. 396 

115TH CONGRESS REPORT " ! SENATE 2d Session 115–239 

GAO AUDIT MANDATES REVISION ACT OF 2018 

MAY 7, 2018.—Ordered to be printed 

Mr. JOHNSON, from the Committee on Homeland Security and 

Governmental Affairs, submitted the following 

R E P O R T 

[To accompany S. 2400] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Homeland Security and Governmental Affairs, 

to which was referred the bill (S. 2400) to eliminate or modify certain audit mandates of the Government Accountability Office, having considered the same, reports favorably thereon without amendment and recommends that the bill do pass. 

CONTENTS 

Page 

I. Purpose and Summary .................................................................................. 1 

II. Background and Need for the Legislation ................................................... 2 

III. Legislative History ......................................................................................... 3 

IV. Section-by-Section Analysis .......................................................................... 3 

V. Evaluation of Regulatory Impact .................................................................. 3 

VI. Congressional Budget Office Cost Estimate ................................................ 4 

VII. Changes in Existing Law Made by the Bill, as Reported ........................... 4 

I. PURPOSE AND SUMMARY

S. 2400, the GAO Audit Mandates Revision Act of 2018, revises 

three congressionally-mandated financial audits conducted by the 

Government Accountability Office (GAO). Modifying these audits 

better prioritizes resources, saving approximately 8,400 employee 

hours at GAO.1

2 

2 U.S. Gov’t Accountability Off., About GAO (2018), available at https://www.gao.gov/about/ 

index.html. 3S. Rep. No. 112–219 at 1 (2012). 

4 Id. at 2. 5Pub. L. No. 114–301 (114th Cong.). 

6Meeting with Timothy Minelli, Assistant Dir. of Cong. Relations, U.S. Gov’t Accountability 

Office, to Staff, S. Comm. on Homeland Sec. & Governmental Affairs (Aug. 2, 2017); see also 

Email from Brett Baker, Senior Health Policy Advisor, S. Comm. on Finance, to Daniel Spino, 

Research Assistant, S. Comm. on Homeland Sec. & Governmental Affairs (Jan. 24, 2018, 04:36 

EST) (on file with Committee); Email from Lauren Comeau, Professional Staff Member, S. 

Comm. on Appropriations, to Daniel Spino, Research Assistant, S. Comm. on Homeland Sec. & 

Governmental Affairs (Jan. 24, 2018, 11:07 EST) (on file with Committee); Email from Travis 

Hill, Senior Counsel, S. Comm. on Banking, to Daniel Spino, Research Assistant, S. Comm. on 

Homeland Sec. & Governmental Affairs (Jan. 29, 2018, 05:50 EST) (on file with Committee). 7 Id. 

8Patient-Centered Outcomes Research Institute, Financial Report 2016 (Sept. 30, 2016); Patient-Centered Outcomes Research Institute, Financial Report 2015 (Sept. 30, 2015); PatientCentered Outcomes Research Institute, Financial Report 2014 (Sept. 30, 2014); Patient-Centered 

Outcomes Research Institute, Financial Report 2013 (Sept. 30, 2013); Patient-Centered Outcomes Research Institute, Financial Report 2016 (Dec. 31, 2012); Patient-Centered Outcomes Research Institute, Financial Report 2016 (Dec. 31, 2011). 9 Email from Francisco Riojas, Special Advisor, Dep’t of Treasury, to Daniel Spino, Research 

Assistant, S. Comm. on Homeland Sec. & Governmental Affairs (Feb. 21, 2018, 05:35 EST) (on 

file with Committee). 10 Id. 

II. BACKGROUND AND THE NEED FOR LEGISLATION

GAO is an independent, nonpartisan agency with a mission ‘‘to 

support the Congress in meeting its constitutional responsibilities 

and to help improve the performance and ensure the accountability 

of the federal government for the benefit of the American people.’’ 2

During the 112th Congress, the Committee worked with GAO to reduce or modify outdated and unnecessary reporting requirement 

mandated by Congress.3 As a result, Congress enacted the GAO 

Mandates Revision Act of 2012 to revise eight congressionally-mandated reports, allowing GAO to focus its workforce on higher-priority oversight.4

In the 114th Congress, the Committee again reviewed GAO’s 

congressionally-mandated work and secured the passage of the 

GAO Mandates Revision Act of 2016, which revised an additional 

eight mandates.5

This Congress, GAO initiated a review process in which it conducted an agency-wide evaluation of its mandated financial audit 

reports. Through this process, GAO identified financial audits that 

Congress can reassign to more appropriate Government entities. 

GAO and the Committee worked with committees of jurisdiction to 

refine this list.6

The result, S. 2400, revises three financial audits related to the 

Congressional Award Foundation (CAF), the Patient-Centered Outcomes Research Institute (PCORI), and the Troubled Asset Relief 

Program (TARP). The bill removes the requirement that GAO conduct a duplicative review of the annual financial audits of the CAF 

and PCORI. CAF presents its audit directly to Congress, and a duplicative review is unnecessary.7 PCORI’s financial audits are prepared by an independent auditor that has not found any questionable results or practices.8 Finally, the bill moves the annual audit 

of TARP from GAO to U.S. Department of the Treasury Inspector 

General. GAO currently hires an independent contractor to conduct 

these audits using funds from TARP, essentially making GAO an 

unnecessary middle man.9 The department’s inspector general is a 

more appropriate entity to manage this audit of the program.10

3 

III. LEGISLATIVE HISTORY

Ranking Member Claire McCaskill (D–MO) and Chairman Ron 

Johnson (R–WI) introduced S. 2400, the GAO Audit Mandates Revision Act of 2018, on February 7, 2018. The bill was referred to 

the Committee on Homeland Security and Governmental Affairs. 

The Committee considered S. 2400 at a business meeting on February 14, 2018. The bill was ordered reported favorably en bloc by 

voice vote. Senators present for the vote were Johnson, Portman, 

Paul, Lankford, Enzi, Hoeven, Daines, McCaskill, Heitkamp, 

Peters, Hassan, Harris, and Jones. 

IV. SECTION-BY-SECTION ANALYSIS OF THE BILL, AS REPORTED

Section 1. Short title 

This section establishes the bill’s short title as the ‘‘GAO Audit 

Mandates Revision Act of 2018.’’ 

Section 2. Audits modified 

Subsection (a) eliminates the requirement for the Comptroller 

General of the United States to review CAF’s financial audits. 

Subsection (b) repeals the requirement that GAO review PCORI’s 

annual financial audit and amends the reporting requirement so 

that GAO only reports every five years. 

Subsection (c) transfers the responsibility of reviewing TARP’s financial audit from GAO to the Inspector General of the U.S. Department of the Treasury. Subparagraph (2)(A) states that the Secretary should transfer the necessary funds to reimburse the Inspector General of the Department of Treasury for performing the 

audit. Subsection (B) explains that the reimbursements should be 

accredited to the ‘‘Salaries and expenses’’ account of the Treasury 

OIG. 

Subsection (3) requires TARP to take action to address any deficiencies that are identified by the auditor. When no actions need 

to be taken, TARP needs to certify with the appropriate congressional committees that no action is necessary. 

V. EVALUATION OF REGULATORY IMPACT

Pursuant to the requirements of paragraph 11(b) of rule XXVI of 

the Standing Rules of the Senate, the Committee has considered 

the regulatory impact of this bill and determined that the bill will 

have no regulatory impact within the meaning of the rules. The 

Committee agrees with the Congressional Budget Office’s statement that the bill contains no intergovernmental or private-sector 

mandates as defined in the Unfunded Mandates Reform Act 

(UMRA) and would impose no costs on state, local, or tribal governments. 

4 

VI. CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, February 23, 2018. 

Hon. RON JOHNSON, 

Chairman, Committee on Homeland Security and Governmental Affairs, U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2400, the GAO Audit Mandates Revision Act of 2018. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Matthew Pickford. 

Sincerely, 

KEITH HALL, 

Director. 

Enclosure. 

S. 2400—GAO Audit Mandates Revision Act of 2018 

The Congress routinely requires the Government Accountability 

Office (GAO) to perform annual examinations of programs, agencies, or federal activities. S. 2400 would repeal the requirement for 

GAO to audit and review the Congressional Award Foundation and 

the Patient Centered Outcomes Research Institute. In addition, the 

bill would transfer GAO’s responsibility for auditing the Troubled 

Asset Relief Program to the Department of the Treasury. 

CBO estimates that implementing S. 2400 would have no significant effect on the federal budget. GAO has an annual budget of 

more than $500 million and prepares hundreds of reports for the 

Congress each year. CBO expects that implementing S. 2400 would 

decrease the agency’s costs by less than $500,000 a year. Any reduction in the agency’s spending would depend on the amounts provided to GAO in future appropriation bills. 

Enacting S. 2400 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. 

CBO estimates that enacting S. 2400 would not increase net direct spending or on-budget deficits in any of the four consecutive 

10-year periods beginning in 2028. 

S. 2400 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act. 

The CBO staff contact for this estimate is Matthew Pickford. The 

estimate was approved by H. Samuel Papenfuss, Deputy Assistant 

Director for Budget Analysis. 

VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with paragraph 12 of rule XXVI of the Standing 

Rules of the Senate, changes in existing law made by the bill, as 

reported, are shown as follows (existing law proposed to be omitted 

is enclosed in brackets, new matter is printed in italic, and existing 

law in which no change is proposed is shown in roman): 

UNITED STATES CODE 

* * * * * * * 

5 

TITLE 2—THE CONGRESS 

* * * * * * * 

CHAPTER 19—CONGRESSIONAL AWARD PROGRAM 

* * * * * * * 

SEC. 807. AUDITS.— 

(a) * * * 

(b) ANNUAL REPORT TO CONGRESS ON AUDIT RESULTS.—Not later 

than May 15 of each calendar year, the Board shall submit to appropriate officers, committees, and subcommittees of Congress øand 

to the Comptroller General of the United States¿ a report on the 

results of the most recent audit conducted pursuant to this section, 

and shall include in the report information on any such additional 

areas as the independent public accountant who conducted the 

audit determines deserve or require evaluation. 

ø(c) REVIEW BY THE COMPTROLLER GENERAL OF ANNUAL AUDIT.— ø(1) The Comptroller General of the United States shall review each annual audit conducted under subsection (a). 

ø(2) For purposes of a review under paragraph (1), the 

Comptroller General, or any duly authorized representative of 

the Comptroller General, shall have access to any books, documents, papers, and records of the Board or such corporation, 

or any agent of the Board or such corporation, including the 

independent external auditor designated under subsection (a), 

which, in the opinion of the Comptroller General, may be pertinent. 

ø(3) Not later than 180 days after the date on which the 

Comptroller General receives a report under subsection (b), the 

Comptroller General shall submit to Congress a report containing the results of the review conducted under paragraph 

(1) with respect to the preceding year.¿ 

* * * * * * * 

TITLE 12—BANKS AND BANKING 

* * * * * * * 

CHAPTER 52—EMERGENCY ECONOMIC STABILIZATION 

* * * * * * * 

Subchapter I—Troubled Assets Relief Program 

* * * * * * * 

Sec. 5226—Oversight and audits.— 

(a) * * * 

ø(b) COMPTROLLER GENERAL AUDITS.— 

ø(1) ANNUAL AUDIT.—The TARP shall annually prepare and 

issue to the appropriate committees of Congress and the public 

audited financial statements prepared in accordance with generally accepted accounting principles, and the Comptroller 

General shall annually audit such statements in accordance 

with generally accepted auditing standards. The Treasury shall 

6 

reimburse the Government Accountability Office for the full 

cost of any such audit as billed therefor by the Comptroller 

General. Such reimbursements shall be credited to the appropriation account ‘‘Salaries and Expenses, Government Accountability Office’’ current when the payment is received and remain available until expended. The financial statements prepared under this paragraph shall be on the fiscal year basis 

prescribed under section 1102 of title 31. 

ø(2) AUTHORITY.—The Comptroller General may audit the 

programs, activities, receipts, expenditures, and financial 

transactions of the TARP and any agents and representatives 

of the TARP (as related to the agent or representative’s activities on behalf of or under the authority of the TARP), including 

vehicles established by the Secretary under this chapter. 

ø(3) CORRECTIVE RESPONSES TO AUDIT PROBLEMS.—The 

TARP shall— 

ø(A) take action to address deficiencies identified by the 

Comptroller General or other auditor engaged by the 

TARP; or 

ø(B) certify to appropriate committees of Congress that 

no action is necessary or appropriate.¿ 

(b) AUDITS.— 

(1) ANNUAL AUDIT.—The TARP shall annually prepare and 

issue to the appropriate committees of Congress and the public 

audited financial statements that shall be— 

(A) prepared in accordance with generally accepted accounting principles; 

(B) prepared and audited in the same manner as the financial statements of covered executive agency components 

under sections 3515 and 3521 of title 31, United States 

Code; and 

(C) prepared on the fiscal year basis prescribed under 

section 1102 of title 31, United States Code. 

(2) AUDIT COSTS.— 

(A) IN GENERAL.The Secretary shall transfer to the Inspector General of the Department of the Treasury such 

sums as are necessary to reimburse the Inspector General 

for the full cost of performing an audit required under 

paragraph (1) or procuring the audit from an independent 

external auditor. 

(B) CREDIT.—The reimbursements described in subparagraph (A) shall be credited to the appropriation account 

‘‘Salaries and expenses, Office of the Inspector General, Department of the Treasury’’ current when the payment is received and remain available under expended. 

(3) CORRECTIVE RESPONSIVE TO AUDIT PROBLEMS.—The 

TARP shall— 

(A) take action to address deficiencies identified by the 

auditor of the TARP financial statements; or 

(B) certify to the appropriate committees of Congress that 

no action is necessary or appropriate. 

* * * * * * * 

7 

TITLE 42—THE PUBLIC HEALTH AND WELFARE 

* * * * * * * 

CHAPTER 7—SOCIAL SECURITY 

* * * * * * * 

Subchapter XI—General Provisions, Peer Review, and 

Administrative Simplification 

* * * * * * * 

PART D—Comparative Clinical Effectiveness Research 

(a) * * * 

* * * * * * * 

(g) FINANCIAL AND GOVERNMENTAL OVERSIGHT.— (1) CONTRACT FOR AUDIT.—The Institute shall provide for the 

conduct of financial audits of the institute on an øannual¿ 

basis by a private entity with expertise in conducting financial 

audits. 

(2) REVIEW AND ANNUAL REPORTS.— (A) REVIEW.—The Comptroller General of the United 

States shall review the following: 

ø(i) Not less frequently than on an annual basis, the 

financial audits conducted under paragraph (1).¿ 

ø(ii)¿(i) Not less frequently than every 5 years, the 

processes established by the Institute, including the 

research priorities and the conduct of research 

projects, in order to determine whether information 

produced by such research projects is objective and 

credible, is produced in a manner consistent with the 

requirements under this section, and is developed 

through a transparent process. 

ø(iii)¿(ii) Not less frequently than every 5 years, the 

dissemination and training activities and data networks established under section 937 of the Public 

Health Service Act ø42 U.S.C. 299b–37¿, including the 

methods and products used to disseminate research, 

the types of training conducted and supported, and the 

types and functions of the data networks established, 

in order to determine whether the activities and data 

are produced in a manner consistent with the requirements under such section. 

ø(iv)¿(iii) Not less frequently than every 5 years, the 

overall effectiveness of activities conducted under this 

section and the dissemination, training, and capacity 

building activities conducted under section 937 of the 

Public Health Service Act. Such review shall include 

an analysis of the extent to which research findings 

are used by health care decision-makers, the effect of 

the dissemination of such findings on reducing practice variation and disparities in health care, and the 

effect of the research conducted and disseminated on 

8 

innovation and the health care economy of the United 

States. 

ø(v)¿(iv) Not later than 8 years after March 23, 

2010, the adequacy and use of the funding for the Institute and the activities conducted under section 937 

of the Public Health Service Act, including a determination as to whether, based on the utilization of research findings by public and private payers, funding 

sources for the Patient-Centered Outcomes Research 

Trust Fund under section 9511 of the Internal Revenue Code of 1986 are appropriate and whether such 

sources of funding should be continued or adjusted. 

(B) øANNUAL R¿ REPORTS.—Not later than April 1 of 

each year, in which a review is conducted under subparagraph (A), the Comptroller General of the United States 

shall submit to Congress a report containing the results of 

the review øconducted under subparagraph (A) with respect to the preceding year (or years, if applicable),¿ together with recommendations for such legislation and administrative action as the Comptroller General determines 

appropriate. 

* * * * * * * 

Æ