INFORMATION 

TECHNOLOGY

IRS Needs to Improve 

the Reliability and 

Transparency of 

Reported Investment 

Information

Report to Congressional Committees

April 2014

GAO-14-298

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-298, a report to 

congressional committees

April 2014

INFORMATION TECHNOLOGY

IRS Needs to Improve the Reliability and 

Transparency of Reported Investment Information

Why GAO Did This Study

IRS relies extensively on IT systems to 

annually collect more than $2 trillion in 

taxes, distribute more than $300 billion 

in refunds, and carry out its mission of 

providing service to America’s 

taxpayers in meeting their tax 

obligations. For fiscal year 2014, the 

agency’s budget request is $2.6 billion 

for IT. Given the size and significance 

of IRS’s IT investments, and the 

challenges inherent in successfully 

delivering these complex IT systems, it 

is important that Congress be provided 

reliable cost, schedule, and scope 

information to assist with its oversight 

responsibilities.

Accordingly, GAO’s objectives were to 

(1) summarize the reported cost and 

schedule performance for IRS’s major 

IT investments and assess the 

reporting of the performance 

information (2) for selected 

investments, evaluate the reliability of 

reported cost and schedule variances; 

and (3) determine IRS’s progress in 

implementing a quantitative measure 

of functionality delivered for projects. 

To address these objectives, GAO 

reviewed documentation, including 

monthly cost and schedule variance 

reports, and interviewed staff, including 

those from selected investments which 

are critical to IRS’s mission.

What GAO Recommends

GAO is making recommendations for 

IRS to report more comprehensive and 

reliable cost and schedule information 

and improve the transparency of 

reported scope information for its major 

investments. IRS agreed with GAO's 

recommendations and stated it 

believed it had addressed one of them. 

GAO continues to believe further 

actions are needed.

What GAO Found

According to the Internal Revenue Service (IRS), 6 of its19 major information 

technology (IT) investments were within 10 percent of cost and schedule 

estimates during fiscal year 2013. The remaining 13 were reported as having

significant cost and schedule variances for at least 1 month of the year. 

Specifically, IRS reported 8 investments as being below cost or ahead of 

schedule; 3 as behind schedule; and 2 as over cost (see figure). IRS reported a 

range of reasons for these variances, including cost savings from contract 

negotiations and scope deferrals for those below cost or ahead of schedule, and 

procurement delays for those behind schedule. It is important to note that the 

reported monthly cost and schedule variances are for the fiscal year only. IRS’s 

reporting would be more meaningful if it were supplemented with cumulative cost 

and schedule variances for the investments or investment segments, consistent 

with the Office of Management and Budget’s guidance for measuring progress 

towards meeting investment goals.

Summary of Investments with Significant Variances

The reported variances for six investments reviewed were not always reliable 

because the projected and actual cost and schedule amounts on which they 

depend were not consistently updated in accordance with OMB and Treasury 

reporting requirements. Specifically, projected amounts were not always updated 

on a monthly basis for in-process (i.e., ongoing) activities for a range of reasons; 

and actual information was not consistently updated for completed activities 

within the 60-day time frame required by Treasury guidance. Addressing these 

issues would help IRS improve the reliability of reported information and provide 

Congress with a more accurate report of the agency’s performance in meeting 

cost and schedule goals.

IRS is currently not working on developing a quantitative measure of scope (i.e., 

functionality) as GAO recommended in June 2012 and does not plan on doing 

so, because it believes it is difficult to develop a single measure that would allow 

it to measure progress in delivering scope for the range of IRS’s investments. 

However, the agency could develop measures using different methods as 

appropriate. In addition, IRS has started to include scope performance (in the 

functional performance section) in its quarterly reporting to Congress. However, 

this information does not include a quantitative measure of performance. In 

addition, it does not show how delivered scope compares to what was planned. 

Providing transparency into progress in delivering scope by reporting qualitatively 

in the congressional reports until a quantitative measure is developed would help 

IRS provide Congress a complete picture of the agency’s performance in 

managing its major investments.

View GAO-14-298. For more information, 

contact David A. Powner at (202) 512-9286 or 

pownerd@gao.gov.
Page i GAO-14-298 Information Technology

Letter 1

Background 3

Most of IRS’s 19 Major Investments Reportedly Within or Below 

Cost or Schedule Goals, but Reported Information Is Only for 

the Current Fiscal Year 10

Reported Cost and Schedule Information Not Always Reliable 12

IRS Has Yet to Develop a Quantitative Measure of Scope 16

Conclusions 17

Recommendations for Executive Action 17

Agency Comments and Our Evaluation 18

Appendix I Objectives, Scope, and Methodology 22

Appendix II Reasons for Significant Variances 25

Appendix III Investment Variances Reported by IRS from October 

2012 to September 2013 28

Appendix IV Investment Profiles 30

Appendix V Comments from the Department of the Treasury 39

Appendix VI GAO Contact and Staff Acknowledgements 41

Tables

Table 1: IRS’s Major Investments and Their Descriptions 6

Table 2: Timeliness of Reporting Status of Activities 14

Table 3: Variances for IRS’ Major IT Investments from October 

2012 to September 2013 28

Contents
Page ii GAO-14-298 Information Technology

Figures

Figure 1: IRS’s Information Technology Organization 5

Figure 2: Summary of Investments with Significant Variances 11

Abbreviations

ACA IRS Affordable Care Act

CADE Customer Account Data Engine

CIO Chief Information Officer

IMF Individual Master File

IRDM Information Reporting and Document 

Matching

IRS Internal Revenue Service

IT information technology

MeF Modernized e-File

OMB Office of Management and Budget

RRP Return Review Program

TIGTA Treasury Inspector General for Tax 

Administration

Treasury Department of Treasury

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

copyrighted images or other material, permission from the copyright holder may be 

necessary if you wish to reproduce this material separately.
Page 1 GAO-14-298 Information Technology

441 G St. N.W.

Washington, DC 20548

April 2, 2014

Congressional Committees

The Internal Revenue Service (IRS) relies extensively on information 

technology (IT) systems to annually collect more than $2 trillion in taxes, 

distribute more than $300 billion in refunds, and carry out its mission of 

providing service to America’s taxpayers in meeting their tax obligations. 

For fiscal year 2014, the agency’s budget request is $2.6 billion for IT, 

about 20 percent of IRS’s total budget request for the year.

Given the size and significance of IRS’s IT investments, and the 

challenges inherent in successfully delivery these complex IT systems, it 

is important that Congress be provided ongoing, accurate, and objective 

information on the progress toward completion and the risks facing these 

projects. Accordingly, the Conference Report accompanying the 

Consolidated Appropriations Act, 2012 and the Consolidated and Further 

Continuing Appropriations Act, 2013 mandated GAO to review the cost 

and schedule performance of IRS’s major IT investments.1 Specifically, 

our objectives were to (1) summarize the reported cost and schedule 

performance for IRS’s major IT investments and assess the reporting of 

the performance information;2

 1

H.R. Rep. No. 112-331, at 901 (2011) (Conf. Rep.); Consolidated Appropriations Act, 

2012, Pub. L. No. 112-74, 125 Stat. 786, 884, div. C, title I (2011); and Consolidated and 

Further Continuing Appropriations Act, 2013, Pub. L. No. 113-6, 127 Stat. 198, 412, Div. 

F, title I (2013).

(2) for selected investments, evaluate the 

2

At the time of the mandate, Affordable Care Act, which refers to IRS’s IT efforts to 

implement selected provisions of the Patient Protection and Affordable Care Act, Pub. L. 

No. 111-148, 124 Stat. 119 (2010), as amended by the Health Care and Education 

Reconciliation Act of 2010, Pub. L. No. 111-152, 124 Stat. 1029 (2010) was not classified 

as a major investment because IRS reportedly did not have time to prepare the 

documentation required to classify it as such for fiscal year 2013. We nevertheless 

included it in our review due to its criticality to IRS’s mission and expected costs. Also, at 

the start of fiscal year 2014, IRS started reporting on it as a major investment. In this 

report, we are not evaluating the healthcare.gov initiative headed by the Centers for 

Medicare and Medicaid Services. 
Page 2 GAO-14-298 Information Technology

reliability of reported cost and schedule variances;3,4

To address our first objective, we obtained and analyzed monthly cost 

and schedule variances for IRS’s major IT investments from October 

2012 to September 2013, as reported by IRS. Additionally, we identified 

significant cost and schedule variances—those variances that were 10 

percent greater or less than planned cost and schedule goals.

and (3) determine 

IRS’s progress in implementing a quantitative measure of functionality 

delivered for projects.

For our second objective, we analyzed monthly cost and schedule 

variance reports to determine whether they reflected monthly updates for 

both in-process and completed activities. We also interviewed relevant 

IRS officials to determine IRS’s progress in addressing our recent 

recommendation to establish guidance for determining projected cost and 

schedule amounts—which are critical to calculating variances—in 

accordance with best practices.

To address our third objective, we followed up with IRS officials to 

determine what progress had been made in putting in place a quantitative 

measure of functionality delivered as we had previously recommended.5

 3

The selected investments for this review are: Customer Account Data Engine (CADE) 2; 

Modernized e-File (MeF); IRS.gov—which is comprised of the Public User Portal, 

Registered User Portal, and Employee User Portal—Return Review Program (RRP); 

Information Reporting and Document Matching (IRDM); e-services; and ACA. We 

performed a detailed analysis of the cost and schedule performance for these seven 

investments in our April 2013 review of IRS’s major investments summarized in GAO, IRS 

2013 Budget: Continuing to Improve Information on Program Costs and Results Could Aid 

in Resource Decision Making, 

When we learned IRS had not addressed our recommendation and was 

not planning on doing so, we followed up on the causes and, for each of 

the investments in our selection, identified the qualitative methods IRS 

stated it was using to manage scope.

GAO-12-603 (Washington, D.C.: June 8, 2012). We 

selected them again for this review because (1) we identified reliability issues in our prior 

review that we wanted to follow up on, and (2) these investments are still critical to IRS’s 

mission.

4

Variances measure differences between estimated cost and schedule goals and actual or 

projected cost and schedule at one point in time. As such, variances provide indicators of 

performance or progress in meeting goals. 

5

GAO-12-603. 
Page 3 GAO-14-298 Information Technology

We conducted this performance audit from June 2013 to April 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require 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. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. Details on our objectives, 

scope, and methodology can be found in appendix I.

The mission of IRS, a bureau within the Department of the Treasury 

(Treasury), is to provide America’s taxpayers top quality service by 

helping them understand and meet their tax responsibilities and by 

applying the federal tax laws with integrity and fairness to all. In carrying 

out its mission, IRS annually collects over $2 trillion in taxes from millions 

of individual taxpayers and numerous other types of taxpayers and 

manages the distribution of over $300 billion in refunds. To guide its 

future direction, the agency has two strategic goals: (1) improve taxpayer 

service to make voluntary compliance easier and (2) enforce the law to 

ensure everyone meets their obligations to pay taxes.

IRS is organized into four primary operating divisions to meet the needs 

of specific taxpayer segments.

• The Wage and Investment Division services individual taxpayers and 

provides the information, support, and assistance these taxpayers 

need to fulfill their tax obligations.

• The Small Business and Self-Employed Division services all fully or 

partially self-employed individuals and corporations and partnerships 

with assets of $10 million or less.

• The Large Business and International Division services corporations 

and partnerships with assets greater than $10 million.

• The Tax Exempt and Government Entities Division services a large 

and unique economic sector of organizations, which include pension 

plans, exempt organizations, governmental entities, and tax-exempt 

bond issuers.

IRS’s Information Technology organization is responsible for delivering IT 

services and solutions to support tax administration as well as the 

operations of the broader organization. Information Technology is headed 

by the Chief Technology Officer who reports to the Deputy Commissioner 

Background
Page 4 GAO-14-298 Information Technology

for Operations Support.6

• The Associate CIO for Applications Development builds, tests, 

delivers, and maintains integrated information application systems 

that will support modernized systems and the production environment. 

It is the development organization for systems that manage taxpayer 

accounts from the initial filing of a tax return, interactions with the 

taxpayers, and potential audit and collection activities. It also provides 

enterprisewide administrative systems related to workforce support, 

human capital, financial, and facilities. Application Development is 

responsible for two of the seven programs we selected for detailed 

analysis in our review.

It includes nine subordinate offices; among 

those are:

• The Associate CIO for Enterprise Operations is responsible for 

supporting the mainframe and server environment by providing 

efficient, cost-effective, secure and reliable server and mainframe 

services for all IRS business entities and taxpayers. It also is 

responsible for financial management, human resources, training 

support and general business administration, developing an 

enterprisewide development and test environment and establishing 

security management. The Associate CIO is responsible for one of the 

seven programs we selected for detailed analysis in our review.

• The Associate CIO for Strategy and Planning is to facilitate the 

alignment of IT and business. This is to be done through strategic 

planning and financial management practices that offer transparency 

of overall IT demand, supply, and the value of IT investments. This 

office includes a suboffice that is responsible for optimizing the 

efficiency and effectiveness of the IT portfolio through fiscally sound 

portfolio management processes. The office also serves as the 

primary interface with Treasury’s capital planning and investment 

control organizations to coordinate actions including baseline change 

requests, budget formulation documents, and IT Dashboard reporting.

• The Associate CIO for Enterprise IT Program Management Office is 

responsible for the delivery of integrated solutions for several of IRS’s 

large-scale programs. It plays a key role in establishing change, 

configuration, and release plans and implementing new information 

 6

IRS’s Chief Technology Officer also acts as the agency’s Chief Information Officer.
Page 5 GAO-14-298 Information Technology

system functional capabilities. This Associate CIO is responsible for

three of the seven programs we selected for detailed analysis in our

review.

• The Associate Chief Information Officer (CIO) for the Affordable Care 

Act Program Management Office is responsible for setting the overall 

direction, providing day-to-day management and oversight and 

delivery of IRS IT’s contribution for implementing provisions of the 

Patient Protection and Affordable Care Act. This Associate CIO is 

responsible for one of the seven programs we selected for detailed 

analysis in our review.

Figure 1 shows the structure of IRS’s Information Technology 

organization.

Figure 1: IRS’s Information Technology Organization

IT plays a critical role in enabling IRS to carry out its mission and 

responsibilities. For example, the agency relies on information systems to 

process tax returns, account for tax revenues collected, send bills for 

taxes owed, issue refunds, assist in the selection of tax returns for audit, 

and provide telecommunications services for all business activities, 

including the public’s toll-free access to tax information.

For fiscal year 2014, IRS requested about $2.6 billion for IT investments. 

This included about $1.8 billion, about 69 percent, of the total amount for 

19 major investments, and about $800 million, or 31 percent, of the total 

amount for 130 non-major investments. For IRS, a major investment is 

one that costs $10 million in either current year or budget year, or $50 

million over the 5-year period extending from the prior year through the 

IRS Relies on IT to Carry 

Out Its Mission
Page 6 GAO-14-298 Information Technology

budget year +2. The following table provides a list of the 19 investments 

and their descriptions.

Table 1: IRS’s Major Investments and Their Descriptions

Investment Description

Account Management Services Enhances customer support by providing applications that enable IRS employees to 

access, validate, and update individual taxpayer accounts on demand.

Affordable Care Acta Encompasses the planning, development, and implementation of IT systems needed to 

support IRS’s tax administration responsibilities associated with certain provisions of the 

Affordable Care Act. Initiatives that have already been deployed include the initial release 

of the Branded Prescription Drug Industry Fee project and an effort intended to provide a 

secure connection between IRS and the Department of Health and Human 

Services/Centers for Medicare and Medicaid Services to support health insurance 

exchange open enrollment for the Fall of 2013. Future capabilities to be provided include 

performing at-filing checks of tax returns for reporting a premium tax credit, leveraging 

third-party data from the Insurance Marketplaces, and pre-refund compliance activities 

related to healthcare credits claimed by citizens.

Customer Account Data Engine (CADE) 2 Is IRS’s new program for processing individual taxpayer returns that is intended to 

eventually replace the Individual Master File (IMF).The initial phase, which IRS began 

using in January 2012, modified the IMF processing cycle to allow for daily (rather than 

weekly) processing and posting of taxpayer returns and established the database that will 

serve as the authoritative source for all individual taxpayer data. In the second phase, 

which is still in the early planning stages, IRS expects, among other things, to (1) rewrite 

applications so they can directly access and update the database, and (2) ensure 

compliance with Federal Financial System Requirements. 

Electronic Fraud Detection System Intended to detect fraud at the time tax returns are filed in order to eliminate the issuance 

of fraudulent tax refunds.

e-Services Comprises several web-based self-assisted services that are intended to allow authorized 

individuals to do business with IRS electronically.

Foreign Account Tax Compliance Act Intended to implement provisions of the Foreign Account Tax Compliance Act regarding 

financial institutions reporting to IRS information about financial accounts held by U.S. 

taxpayers, or foreign entities in which U.S. taxpayers hold a substantial ownership 

interest.

Return Review Program (expected to 

replace Electronic Fraud Detection 

System)

Currently under development, is intended to maximize fraud detection at the time that tax 

returns are filed to eliminate issuance of questionable refunds. IRS expects to begin 

phasing this system in starting in filing season 2014.

Individual Master File (IMF) Represents the authoritative data source for individual tax account data. All other IRS 

information systems that process IMF data depend on output from this source. This 

investment is a critical component of IRS’s ability to process tax returns. 

Information Reporting and Document 

Matching (IRDM)

Intended to establish a new business information matching program in order to increase 

voluntary compliance and accurate income reporting.

Integrated Customer Communication 

Environment

Includes several projects that are intended to simplify voluntary compliance using voice 

response, Internet, and other computer technology such as the Modernized Internet 

Employee Identification Number, which allows third parties to act on the behalf of 

taxpayers.
Page 7 GAO-14-298 Information Technology

Investment Description

Integrated Data Retrieval System Intended to provide systemic review, improve consistency in case control, alleviate 

staffing needs, issue notices to taxpayers, and allow taxpayers to see status of refunds. It 

is a mission-critical system used by 60,000 IRS employees.

Integrated Financial System/CORE 

Financial System

Used by IRS for budget, payroll, accounts payable/receivable, general ledger functions, 

and financial reporting; also used to report on the cost of operations and to manage 

budgets by fiscal year.

Integrated Submission and Remittance 

Processing System

Processes paper tax returns, and updates tax forms to comply with tax law changes. 

IRS End User Systems and Services Supports products and services necessary for daily functions for over 100,000 IRS 

employees at headquarters and field sites.

IRS Main Frames and Servers Services 

and Support

Intends to support the design, development, and deployment of server storage 

infrastructures, software, databases, and operating systems.

IRS Telecommunications Systems and

Support

Supports IRS’s broad and local network infrastructure such as servers, and switches for 

voice, data, and video servicing of about 1,000 IRS sites.

IRS.gov – Portal Environment Provides web-based services such as tax filing and refund tracking, to internal and 

external users, such as IRS employees and other government agencies, taxpayers, and 

business partners.

Modernized e-File (MeF) Designed to provide a secure web-based platform for electronic tax filing of individual and 

business tax and information returns by registered Electronic Return Originators.

Service Center Recognition/Image 

Processing System (SCRIPS)

Used as a data capture, management, and image storage system using high-speed 

scanning and digital imaging to convert data from the 940, 941, K-1, and paper returns 

from Information Returns Processing, into electronic format. 

Source: GAO analysis of IRS data.

a

Although IRS did not include ACA as a major IT investment in its fiscal year 2014 budget request 

because it reportedly did not have time to prepare the required information, the agency started 

publicly reporting on the investment as a major investment for fiscal year 2014 (in November 2013). 

In addition, officials told us of their plans to classify it as a major investment in the fiscal year 2015 

budget request.

GAO and the Treasury Inspector General for Tax Administration (TIGTA) 

have previously reported on IRS’s ongoing effort to modernize its tax 

administration and internal management systems, the agency’s 

investment management process and key major investments—CADE 2, 

IRDM, and ACA.

• Regarding investment management, in July 2011 we found that IRS 

had established most of the foundational practices needed to 

effectively manage its IT investments by executing 30 of the 38 key 

practices identified by the information technology investment 

GAO and the Treasury 

Inspector General for Tax 

Administration Have 

Previously Reported on 

IRS’s Key Major IT 

Investments
Page 8 GAO-14-298 Information Technology

management framework, including all of those needed for effective 

project oversight.7

• Further, we reported in October 2011 that CADE 2 was one of seven 

investments considered to be successfully acquired in that it best 

achieved its respective cost, schedule, scope, and performance goals. 

Officials cited active engagement with program stakeholders as a 

critical factor to the success of those investments and, overall nine 

common factors that were critical to the success of major IT 

investments were identified.8

• We reported in April 2013 that the majority of IRS’s major IT 

investments were reportedly within 10 percent of cost and schedule 

estimates and 8 major IT investments reported significant cost and/or 

schedule variance. We also reported that weaknesses existed, to 

varying degrees, in the reliability of reported cost and schedule 

variances; and key risks and mitigation strategies were identified.9

 7

GAO, Investment Management: IRS Has a Strong Oversight Process but Needs to 

Improve How It Continues Funding Ongoing Investments, 

As 

result, we made recommendations for IRS to improve the reliability of 

reported cost and schedule information by addressing the identified 

weaknesses in future updates of estimates. We also recommended 

that IRS ensure projects consistently follow guidance for updating 

performance information 60 days after completion of an activity and 

develop and implement guidance that specifies best practices to 

consider when determining projected amounts. IRS agreed with three 

of our four recommendations and partially disagreed with the fourth 

recommendation related to guidance on projecting cost and schedule 

amounts. The agency specifically disagreed with the use of earned 

value management data as a best practice to determine projected 

cost and schedule amounts, stating that the technique is not part of 

IRS’s current program management processes and the cost and 

burden to use it outweighs the value added. While we disagreed with 

IRS’s view of earned value management because best practices have 

GAO-11-587 (Washington, 

D.C.: July 20, 2011).

8

GAO, Information Technology: Critical Factors Underlying Successful Major Acquisitions, 

GAO-12-7 (Washington, D.C.: Oct. 21, 2011).

9

GAO, Information Technology: Consistently Applying Best Practices Could Help IRS 

Improve the Reliability of Reported Cost and Schedule Information, GAO-13-401 

(Washington, D.C.: Apr. 17, 2013).
Page 9 GAO-14-298 Information Technology

found that the value generally outweighs the cost and burden of 

implementing it, we provided it as one of several examples of 

practices that could be used to determine projected amounts. We also 

noted that implementing our recommendation would help improve the 

reliability of report cost and schedule variance information, and that 

IRS had flexibility in determining which best practices to use to 

calculate projected amounts. For those reasons, we believed our 

recommendation was still warranted.

• In our September 2013 review, we reported that IRS had updated the 

ACA cost estimate we had reviewed in our June 2012 budget report 

and noted that it reflected best practices to a greater extent.10 For 

example, the estimate reflected the full life-cycle cost of the program. 

However, we noted a few areas remained where IRS could continue 

to improve the reliability of the estimate. We will continue to monitor 

IRS’s progress in revising this estimate.

• In September 2013, TIGTA reported that the CADE 2 database crossfunctional triage team effectively managed and resolved more than 

1,000 data defects.11

 10GAO, IRS 2014 Budget: Improvements Made to Budget Request and Cost Estimate, but 

Further Actions Needed, 

However, TIGTA’s review determined that the 

downstream system interfaces were not implemented due to data 

quality issues and revised the implementation date of these interfaces 

to January 2014, raising the estimated cost of transition state 1. 

Finally, the lack of security systems integration prevents transactionlevel tracking of employee access to the database. As a result of 

these findings, TIGTA made recommendations aimed at improving the 

management of the CADE 2 program, including not exiting transition 

state 1 milestone 5 until interfaces with selected downstream systems 

are implemented into production; ensuring the CADE 2 database is 

accurate, complete, timely, and available; deploying the CADE 2 

database as the transactional database architected for transition state 

2 and the target state; and ensuring that user access to the CADE 2 

database is traced at the transaction level by individual user’s 

identification. IRS agreed to certify the database as accurate, 

complete, timely, and available but disagreed with the remaining three 

recommendations.

GAO-13-835 (Washington, D.C.: Sept. 26, 2013).

11TIGTA, Customer Account Data Engine 2 Database Deployment Is Experiencing Delays 

and Increased Costs, 2013-20-125 (Sept. 23, 2013).
Page 10 GAO-14-298 Information Technology

According to IRS, 6 of 19 investments were within 10 percent of cost and 

schedule estimates during fiscal year 2013. The remaining 13 were 

reported as having significant cost and schedule variances for at least 1 

month of the year. Specifically, IRS reported 8 investments as being 

below cost or ahead of schedule;12

• CADE 2, Integrated Financial System, Integrated Submission and 

Remittance Processing System, IRS.gov, Main Frames and Servers 

Services and Support, and RRP were within 10 percent of cost and 

schedule estimates.

3 as behind schedule; and 2 as over 

cost (see fig. 2). IRS reported a range of reasons for these significant 

variances, including cost savings from contract negotiations and scope 

deferrals for those below cost or ahead of schedule, and procurement 

delays for those behind schedule. Specifically, IRS reported that

• Account Management Services, Electronic Fraud Detection System, 

e-Services, Foreign Account Tax Compliance Act, Integrated 

Customer Communication Environment, IMF, IRDM, and Integrated 

Data Retrieval System were significantly below cost or ahead of 

schedule for reasons including early delivery of scope, redesign of 

releases, prematurely closing of an activity, and actual costs being 

lower than expected.

• End User Systems and Services and SCRIPS were reported as being 

behind schedule for reasons such as scope changes, and hardware 

and software procurement issues.

• MeF and ACA were reported as being significantly under cost and 

over cost at different times of the year, and Telecommunications 

Systems and Support was reported as being significantly under cost 

and behind schedule at different times during the year.

According to IRS officials, the significant variances experienced by its 

major investments had no impact on the delivery of expected benefits.

For a detailed list of reasons associated with the significant variances see 

appendix II. Figure 2 shows a summary of investments with significant 

cost and schedule variances.

 12We are highlighting this group of investments because reasons for being below cost or 

ahead of schedule sometimes include scope changes or deferrals.

Most of IRS’s 19 

Major Investments 

Reportedly Within or 

Below Cost or 

Schedule Goals, but 

Reported Information 

Is Only for the 

Current Fiscal Year
Page 11 GAO-14-298 Information Technology

Figure 2: Summary of Investments with Significant Variances

It is important to note that the reported monthly cost and schedule 

variances are for the fiscal year only. IRS’s reporting would be more 

meaningful for determining whether IRS is effectively managing its 

investments if it included cumulative cost and schedule variances for the 

investments or investment segments, consistent with OMB’s guidance for 

measuring progress towards meeting investment goals. Specifically, 

OMB’s fiscal year 2015 guidance on the planning, budgeting, acquisition, 

and management of IT capital assets instructs agencies to structure their 

efforts into “useful segments” (such as projects which accomplish a 

unique product or service with a defined start and end point and specific 

objectives that, when attained, signify completion), and to establish 

systems to measure progress towards these useful segments in terms of 

cost and schedule, among other things.13

IRS’s monthly reports—and thus the quarterly reports to Congress that 

are derived from them—provide cost and schedule variance information 

for all investment projects and activities underway in any portion of the 

fiscal year.14

 13Office of Management and Budget, Guidance on Exhibits 53 and 300 – Information 

Technology and e-Government, OMB Guide (July 1, 2013).

However, this fiscal year focus does not provide cumulative 

cost and schedule information at the useful segment level because it 

does not account for activities that were completed in previous fiscal 

years. In addition, it does not provide a realistic representation of 

performance because it includes activities which are not scheduled to 

begin until later in the fiscal year and reports these activities as having 

14Projects and activities underway during the fiscal year include those that started in a 

previous fiscal year and were not completed by the beginning of the current fiscal year; 

those that are scheduled to start and finish in the current fiscal year and budget year; and 

those scheduled to start in the current fiscal year and budget year that will not be 

completed until the following fiscal year.
Page 12 GAO-14-298 Information Technology

zero cost and schedule variances.15

Officials told us that the way the agency reports is consistent with 

Treasury guidance and OMB reporting requirements. Nonetheless, while 

IRS’s reporting is aligned with the manner in which budgets are allocated, 

it does not provide a measure of progress towards the useful segments

For example, in the June 2013 

monthly report, IRS reported a 5.07 percent cost underrun for RRP. The 

cost variance calculation included a zero variance for an activity that was 

not scheduled to start until the following month. The variance not 

including this activity would have been 6.06 percent.

16

Although OMB and Treasury require cost and schedule variances to be 

updated on a monthly basis using actual cost and schedule amounts or 

projected cost and schedule amounts when actual information is not 

available, the reported variances for six investments reviewed were not 

always reliable because the projected and actual cost and schedule 

amounts on which they depend were not consistently updated.

which are associated with specific functionality as recommended in OMB 

guidance, and therefore does not fully capture IRS’s performance in 

meeting overall project and investment level cost or schedule goals.

Providing Congress with cost and schedule information at the useful 

segment level—in addition to the current fiscal year reporting—in the 

quarterly reports would provide a more meaningful gauge of whether the 

agency is effectively managing its investments.

17

 15Internally, IRS tracks cost and schedule performance at the activity level. Activities are 

rolled up into projects and related projects make up the investments.

Specifically, projected amounts were not always updated on a monthly 

basis for in-process (i.e., ongoing) activities for a range of reasons, 

including apparent confusion among investment staff on what to report 

and instructions not to update information until baseline change requests 

have been approved; and actual information was not consistently updated 

for completed activities within the 60-day time frame required by Treasury 

guidance. Addressing these issues would help IRS improve the reliability 

16IRS’s investments are typically structured by milestones or releases which are 

consistent with the definition of a useful segment.

17ACA was the seventh investment in our selection. We did not include it as part of this 

analysis because it did not report monthly to Treasury and OMB or quarterly to the 

congressional appropriations committees like the other major investments. Instead ACA 

prepared quarterly reports for internal review summarizing the investment’s cost and 

schedule performance which we obtained and analyzed.

Reported Cost and 

Schedule Information 

Not Always Reliable
Page 13 GAO-14-298 Information Technology

of reported information and provide Congress with a more accurate report 

of the agency’s performance in meeting cost and schedule goals.

Cost and schedule variances, which OMB and Treasury require to be 

updated on a monthly basis, are determined by subtracting actual cost 

and schedule from planned amounts or using projected information if 

actual information is not available. In addition, as we previously reported, 

according to best practices, projected cost and schedule can be 

determined in a number of ways, including evaluating critical path (for 

projected schedule), using earned value management data, evaluating 

the performance of completed work and comparing it to the remaining 

budget, assessing commitment values for material needed to complete 

remaining work, and estimating future conditions.18

Although required, IRS’s monthly reports for fiscal year 2013 showed that 

all six investments reviewed did not consistently include updated 

variances for in-process activities. For two of the six investments, staff 

told us they did not include variances for in-process activities for several 

reasons, including that activities are usually 6 months or less. However, 

OMB and Treasury’s guidance do not provide exceptions for shorter 

periods of time such as 6 months or less. Staff for the remaining four 

investments told us they update cost and schedule variances on a 

monthly basis; however, our analysis of the reports we reviewed showed 

that they did not. This is partly due to an inconsistent understanding 

among investment staff of the information that was to be included in the 

monthly reporting—which the Strategy and Planning group responsible 

for overseeing monthly variance reporting also acknowledged.

Regarding the calculation of projected cost and schedule amounts, IRS 

has not yet updated its guidance to include best practices to consider as 

we recommended in April 2013.19

 18

According to officials, the agency has 

experienced delays in addressing the recommendation due to budget 

issues, staffing shortages, and the government shutdown. However, 

officials reported that they have begun evaluating practices and 

processes currently in use as inputs for standard, repeatable, best 

practices for determining cost and schedule projections but they did not 

specify a time frame for fully addressing our recommendation. Developing 

GAO-13-401.

19GAO-13-401.

Cost and Schedule 

Variances for In-process 

Activities Are Not 

Consistently Reported
Page 14 GAO-14-298 Information Technology

and implementing the guidance will provide greater assurance that 

projected amounts, when reported, are determined consistent with best 

practices and therefore reliable.

Treasury’s guidance states that investments have 60 days to report actual 

cost and schedule from the time an activity has been completed. 

According to the guidance, this requirement is one of several intended to 

ensure the accuracy of the monthly reporting data.

The quarterly reports submitted to the appropriations committees 

between December 2012 and September 2013 for performance between 

January 2013 and September 2013 show that, for the six investments 

featured in the reports, IRS updated investment cost and schedule 

variance information with actual amounts within the 60-day time frame 

required by Treasury in 78 percent of the cases, a slight improvement 

from last year. Specifically, four investments—e-Services; IRS.Gov; MeF; 

and RRP—updated all activities within the required time frame. However, 

most of the variances for CADE 2 activities were not updated in a timely 

manner. In addition variances for several IRDM activities were not 

updated on time. Table 2 identifies the number of activities which were 

updated within the 60-day window.

Table 2: Timeliness of Reporting Status of Activities

Number of activities 

completed or intended 

to be completed

Number of activities 

completed or intended to be 

completed that were updated 

within 60 days (percentage)

Investments and total 

number of activities

CADE 2

54

18 5 (28%)

e-Services

26

11 11 (100%)

IRDM

62

35 28 (80%)

IRS.Gov

29

10 10 (100%)

MeF

18

11 11 (100%)

RRP

20

8 8 (100%)

Cost and Schedule 

Variances for Completed 

Activities Were Not Always 

Updated with Actual 

Information in a Timely 

Manner
Page 15 GAO-14-298 Information Technology

Number of activities 

completed or intended 

to be completed

Number of activities 

completed or intended to be 

completed that were updated 

within 60 days (percentage)

Total (209) 93 73 (78%)

Source: GAO analysis of IRS documentation.

In April 2013, we reported on this issue and noted that, according to IRS 

officials, actual information is sometimes not updated within the 60-day 

time frame because of delays associated with approval through the 

governance process.20

Ensuring the variances for completed activities are consistently updated 

with actual information within the 60-day time frame required by Treasury 

as we previously recommended would provide more reliable information 

on which to gauge IRS’s performance in meeting cost and schedule 

goals.

We stated that we believed 60 days to be a 

reasonable amount of time to provide information on the status of an 

activity that was expected to be completed and recommended that IRS 

take action to ensure projects consistently follow guidelines for updating 

performance information 60 days after completion of an activity. Staff 

from IRS’s Strategy and Planning Office told us that, starting in fiscal year 

2014, Treasury has addressed the timeliness issue for schedule 

calculations by having the monthly reporting system automatically 

calculate a variance based on the current date for any activity where the 

planned completion date has passed and investment staff have not 

provided an actual figure within 45 days of that projected date. We 

believe this is a positive step towards ensuring actual information is more 

consistently reported for completed activities within the required 60-day 

time frame and improving the reliability of their variances so they better 

reflect cost and schedule performance.

 20GAO-13-401.
Page 16 GAO-14-298 Information Technology

According to OMB guidance,21 in managing their IT investments, 

agencies must use a performance-based acquisition management system 

or earned value management system in which work progress is quantified 

to measure both what was spent to perform the work and what was 

scheduled to have been accomplished. Consistent with this concept, we 

previously reported that having a quantitative measure of scope is a good 

practice as it provides an objective measure of whether an investment 

delivered the functionality that was paid for, and, in June 2012,22

IRS is currently not working on developing a quantitative measure of 

scope and does not plan on doing so because it believes it is difficult to 

develop a single measure that would allow it to measure progress in 

delivering scope for the range of IRS’s investments. In addition, IRS 

stated that its current scope reporting is adequate for its project 

management purposes. Finally, it has begun reporting on scope 

performance in its quarterly reports to the appropriations committees.

we 

recommended that IRS develop such a measure for all its major 

investments. At that time, IRS agreed with our recommendation.

First, we believe IRS could develop quantitative measures using different 

methods as appropriate. For example, it could use earned value 

management, a technique which integrates the technical scope of work 

with schedule and cost elements for investment planning and control or it 

could leverage its requirements management processes to assign value 

to planned work. Second, while IRS has identified several processes for 

managing scope,23

Staff for four of the seven investments we reviewed said their investments 

have a fixed schedule (tied to the filing season) and they often revert to 

they are primarily used for internal management 

purposes. Finally, while to its credit, IRS has started to include scope 

performance (in the functional performance section) in its quarterly 

reporting to Congress, there are no quantitative measures of progress 

made. In addition, the descriptions provided do not show how delivered 

scope compares to what was planned.

 21Office of Management and Budget, Guidance on Exhibits 53 and 300 – Information 

Technology and e-Government, OMB Guide (July 1, 2013).

22GAO-12-603. 

23These processes include milestone exit reviews, stakeholder review and acceptance of 

deliverables, meetings with executives, and baseline change requests which, according to 

officials, must be approved by Treasury and OMB.

IRS Has Yet to 

Develop a 

Quantitative Measure 

of Scope
Page 17 GAO-14-298 Information Technology

modifying scope to meet this constraint. These changes in scope—which 

staff stated are tracked internally—are often not apparent in reported cost 

and schedule variances, and underline the importance of reporting on 

progress in delivering scope. As an example, in April 2013, data 

assurance, performance tuning, and downstream systems work that was 

planned for CADE 2 Transition State 1 was put into a new release—

Transition State 1 release 1.5—allowing IRS to “exit” Transition State 1 by 

the end of fiscal year 2012, in time for the filing season.

As previously mentioned, a quantitative measure of scope would provide 

an objective indicator of performance. Until such a measure is developed, 

being more transparent about progress in delivering scope by reporting 

qualitatively on how delivered scope compares to what was planned in 

the congressional reports would help IRS provide Congress a complete 

picture of its performance in managing its major investments—particularly 

in those cases where functionality is deferred.

For fiscal year, 2013, the cost and schedule performance for IRS’ major 

IT investments was mixed, with six investments reported as being within 

10 percent of cost and schedule goals throughout the year, eight reported 

as being significantly below cost or ahead of schedule—although in some 

cases, these are due to scope deferrals or poor estimating practices—

and 5 behind schedule or over cost. While the current fiscal year focus of 

the reported information is aligned with the manner in which budgets are 

allocated, reporting cumulative information at the investment or major 

investment segment level—consistent with the delivery of functionality—

would provide a better indicator of IRS’s performance in meeting cost and 

schedule goals. However, the reported cost and schedule variance 

information is not always reliable and Congress therefore may not have 

the most accurate information to inform its decisions. Specifically, the 

variances for in-process and completed activities are not consistently 

updated due to, among other reasons, an inconsistent understanding of 

the information to be included in the monthly reports. IRS’s unreliable 

reporting of cost and schedule variance information is further exacerbated 

by the fact that the agency has not yet developed a quantitative measure 

of scope that would help provide a complete picture of how IRS is 

managing its major investments.

To improve the reliability of reported cost and schedule variance 

information for major investments, we recommend that the Commissioner 

of IRS direct the Chief Technology Officer to take the following three 

actions:

Conclusions

Recommendations for 

Executive Action
Page 18 GAO-14-298 Information Technology

• report cumulative investment and investment segment cost and 

schedule information in the quarterly reports to Congress, consistent 

with OMB requirements for measuring progress towards meeting 

goals;

• ensure that projected cost and schedule variances for in-process 

activities are updated monthly, for the six investments for which we 

reviewed monthly updates, consistent with OMB and Treasury 

reporting requirements, by ensuring investment staff have a 

consistent understanding of the information to be included in monthly 

reports; and

• until a quantitative measure of scope is developed, qualitatively report 

on how delivered scope compares to what was planned in its quarterly 

reports to Congress, for the seven investments for which we reviewed 

scope reporting.

While we did not review the monthly update process and scope reporting 

for all of IRS’s major IT investments, the agency should extend the 

related recommendations we are making as appropriate to other 

investments that are featured in the quarterly reports to Congress.

We obtained written comments on a draft of this report from IRS’s 

Commissioner, which are reprinted in appendix V. In his written 

comments, the Commissioner stated that IRS agreed with our 

recommendations and recognizes the importance of consistent reporting 

to Congress on cost, schedule, and scope and will continue its effort to 

improve management of its investment process and values our support 

and guidance. He further stated IRS believed it had addressed our first 

recommendation to report cumulative investment and investment 

segment cost and schedule information in the quarterly reports to 

Congress as well as the recommendation we previously made to develop 

a quantitative measure of scope relating to our third recommendation. He 

added that the agency would provide a detailed corrective action plan 

addressing our second recommendation with its response to the final 

report. 

Regarding the recommendation to report cumulative investment cost and 

schedule information, the Commissioner stated that cumulative life-cycle 

investment costs for each investment are included in the quarterly report 

to Congress. While the report includes cumulative costs, they are 

cumulative for the fiscal year, not for the investment or investment 

segment as we recommended and they therefore do not account for cost 

Agency Comments

and Our Evaluation
Page 19 GAO-14-298 Information Technology

variances from prior fiscal years. As noted in this report, such reporting 

would be consistent with OMB guidance for measuring progress towards 

useful segments and provide a more meaningful gauge of whether the 

agency is effectively managing its investments. 

Relating to the recommendation we previously made to develop a 

quantitative measure of progress in delivering scope, the Commissioner 

noted that the agency has practices and process in place to assess and 

report on the delivery of scope in conjunction with cost and schedule 

management. He cited the quarterly report to Congress which draws on 

the Exhibit 300 SharePoint Investment Knowledge Exchange data (i.e., 

the monthly variance information we reviewed) and the baseline change 

request process, which specifically addresses the changes that are 

occurring within investments, as examples illustrating the implementation 

of the recommendation. However, we do not believe that these actions 

address our recommendation. Specifically, our review of the monthly 

variance reports show they report cost and schedule variances, not scope 

information. In addition, while the baseline change request process may 

document changes in scope, it does not provide a quantitative measure of 

progress in delivering scope as recommended. Further, while IRS has 

started to include scope performance (in the functional performance

section) in its quarterly reports to Congress, there are no quantitative 

measures of progress in delivering scope. Finally, as noted in our report, 

the qualitative information (i.e., descriptions) provided do not show how 

delivered scope compares to what was planned. For these reasons, we 

believe our prior recommendation to develop a quantitative measure of 

progress in delivering scope and our new recommendation to qualitatively 

report on how delivered scope compares to what was planned in its 

quarterly reports to Congress until such measure is developed are still 

warranted. IRS also provided us with technical comments, which we 

incorporated into this report as appropriate. 
Page 20 GAO-14-298 Information Technology

We are sending copies of this report to interested congressional 

committees and the Commissioner of IRS. This report will also be 

available at no charge on our website at http://www.gao.gov.

If you or your staffs have any questions on matters discussed in this 

report, please contact me at (202) 512-9286 or pownerd@gao.gov. 

Contact points for our Offices of Congressional Relations and Public 

Affairs may be found on the last page of this report. GAO staff who made 

major contributions to this report are listed in appendix VI.

David A. Powner

Director

Information Technology Management Issues
Page 21 GAO-14-298 Information Technology

List of Committees

The Honorable Tom Udall

Chairman

The Honorable Mike Johanns

Ranking Member

Subcommittee on Financial Services and

 General Government

Committee on Appropriations

United States Senate

The Honorable Ander Crenshaw

Chairman

The Honorable Jose E. Serrano

Ranking Member

Subcommittee on Financial Services and

 General Government

Committee on Appropriations

House of Representatives
Page 22 GAO-14-298 Information Technology

Our objectives were to (1) summarize the reported cost and schedule 

performance for IRS’s major information technology (IT) investments and 

assess the reporting of the performance information; (2) for selected 

investments, evaluate the reliability of reported cost and schedule 

variances; and (3) determine IRS’s progress in implementing a 

quantitative measure of functionality delivered for projects.

To address the first objective, we obtained and analyzed monthly cost 

and schedule variance data for IRS’s major IT investments for October 

2012 through September 2013. The variance data provided were from the 

Department of Treasury’s (Treasury) monthly variance reporting tool 

which the department uses for internal oversight and external reporting 

purposes. We identified the investments with reported variances of 10 

percent or more from estimates as having significant variances and 

determined the number of months they reported significant variances. For 

these investments, we obtained the reason for the significant variances 

from the information reported by Treasury on OMB’s IT Dashboard (in 

Treasury’s Chief Information Officer comments) and followed up with IRS 

for clarification as needed. Because the Affordable Care Act (ACA) 

investment was not reporting monthly cost and schedule variances in 

Treasury’s reporting tool, we requested and analyzed the quarterly project 

management reports summarizing the investment’s cost and schedule 

performance. We also identified OMB reporting requirements for 

measuring progress towards useful segments and analyzed IRS’s 

monthly cost and schedule variance reports and the quarterly reports to 

Congress that are derived from them against these requirements.

For our second objective, we selected seven investments: Customer 

Account Data Engine (CADE) 2; Modernized e-File (MeF); IRS.gov—

which is comprised of the Public User Portal, Registered User Portal, and 

Employee User Portal—Return Review Program (RRP); Information 

Reporting and Document Matching (IRDM); e-services; and ACA. We 

performed a detailed analysis of the cost and schedule performance for 

these seven investments in our April 2013 review of IRS’s major 

investments summarized in our prior report.1

 1

We selected them again for 

this review because (1) we identified reliability issues in the April 2013 

review that we wanted to follow up on, and (2) these investments are still 

critical to IRS’s mission. As noted earlier, while ACA is not classified as 

major investment in fiscal year 2013, we included it in our selection 

GAO-13-401.

Appendix I: Objectives, Scope, and 

Methodology
Page 23 GAO-14-298 Information Technology

because of its criticality to IRS’s mission and expected costs. In addition, 

IRS began reporting on it as a major investment in fiscal year 2014.

We identified how each of the six investments in our selection which 

reported monthly cost and schedule variances during fiscal year 2013 

calculated projected amounts.2 We interviewed IRS officials responsible 

for performing these calculations. We also determined the extent to which 

these variances were included in the monthly reports by reviewing 

monthly variance reports from October 2012 through September 2013. In 

addition, to determine, for these investments, the extent to which the IRS 

included variance data for completed activities in its external reporting 

within the 60-day time frame specified in Treasury guidance, we analyzed 

the four quarterly reports on the performance of IT investments submitted 

by IRS to the appropriations committees and GAO between December 

2012 and September 2013. Further, we identified all the activities 

included in the variance calculations by analyzing monthly variance 

reports and supplementing our analyses with interviews of IRS officials 

cognizant of the manner in which IRS reports these variance data to 

Treasury, including the Acting Manager of the IRS’s Strategy and 

Planning group which has oversight responsibility for this reporting. We 

recently reported that IRS did not have guidance from Treasury for 

calculating the variances associated with in-process activities. As such, 

we did not perform a qualitative assessment of the investments’ process 

for calculating cost and schedule variances.3

To address our third objective, we interviewed IRS officials to determine 

what progress the agency had made in developing a quantitative 

measure of progress in delivering scope as we recommended in June 

2012.4

 2

ACA was the seventh investment in our selection. We did not include it as part of this 

analysis because it did not report monthly to Treasury and OMB or quarterly to the 

congressional appropriations committees like the other major investments. 

When we learned IRS had not addressed our recommendation, 

we followed up on the causes, and, for each of the investments in our 

selection, identified the qualitative methods IRS said it was using instead. 

We also analyzed the “functional performance” information IRS has 

begun to include in its quarterly reports to the congressional committees 

3

GAO-13-401.

4

GAO, IRS 2013 Budget: Continuing to Improve Information on Program Costs and 

Results Could Aid in Resource Decision Making, GAO-12-603 (Washington, D.C.: June 8, 

2012). 
Page 24 GAO-14-298 Information Technology

and GAO to determine the extent to which it completely and clearly 

describes how delivered scope compares to what was planned.

We conducted this performance audit from June 2013 to April 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require 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. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Page 25 GAO-14-298 Information Technology

In the Treasury Chief Information Officer’s comments on the federal IT 

dashboard, IRS provided the specific reasons why its investments 

experienced significant cost and schedule variances.

For investments that were significantly below cost or ahead of schedule, 

the agency reported that:

• Account Management Services experienced a cost underrun in 

October 2012 due to an over-estimation of a task order.

• Electronic Fraud Detection System experienced cost underruns from 

February 2013 to September 2013. The underruns noted were due to 

(1) scope being moved to a future release, (2) cost savings from 

contract negotiations, (3) unrealized staffing gains, (4) early delivering 

of business functional changes for filing season 2013, (5) premature 

closure of an activity, and (6) actual amount being less than projected 

amount. The investment submitted, and received approval for, two 

baseline change requests during this period in order to correct 

completion cost and metric description and to align planned and 

projected costs and schedule for filing season 2014 work. The 

investment experienced schedule underruns from November 2012 to 

January 2013. The variances noted were due to (1) early delivery of 

enhancements for filing season 2013 and (2) late delivery of Record 

Layouts for Electronic Filing System.

• e-Services experienced cost underruns in October 2012 and again 

from June 2013 through September 2013. The variances noted were 

due to (1) early delivery of mid-year changes, (2) fewer changes 

required from previous years, (3) lower than expected defect 

resolution time, (4) lower than expected system acceptance test 

tickets, and (5) IRS staff incorrectly charging time.

• Foreign Account Tax Compliance Act experienced cost underruns 

from January 2013 to September 2013. The variances noted were 

due to (1) significant scope changes for release 1, (2) a redesign in 

release 1.1 that did not require as much hardware be purchased 

because investment was able to leverage existing hardware, and (3) 

an overspend on release 1.1, drop 1. A baseline change request was 

approved in February 2013

• Integrated Customer Communication Environment experienced cost 

underruns in October 2012 and from June 2013 to September 2013. 

The variances noted were due to (1) high original estimates for the 

Federal Student Aid activity that over-estimated the complexity of the 

Appendix II: Reasons for Significant 

Variances
Page 26 GAO-14-298 Information Technology

development work and (2) contractor over-estimates of development 

costs.

• IMF experienced a cost underrun in October 2012. The variance 

noted was due to resource contention—staff were pulled off of IMF to 

work on CADE 2 development and testing.

• IRDM experienced cost underruns from April 2013 to September 

2013. The variances noted were due to, among other things, (1) 

delivery partner services costing less than planned because of a delay 

in the contract award being utilized and (2) costs were less than 

planned because resources were reduced on the Business Master 

File Analytics project and utilized on the Case Inventory Selection and 

Analytics project.

• Integrated Data Retrieval System experienced a cost underrun in 

September 2013. The variance noted was due to actual labor costs 

being lower than planned due in part to retirements, attrition, and the 

government-wide pay freeze.

For investments that were significantly behind schedule, the Treasury 

Chief Information Officer’s comments on the federal IT dashboard 

identified the following reasons:

• End User Systems and Services experienced a schedule overrun in 

October 2012. The variance noted was due to several factors: (1) 

scope changes and new funding and resource requirements; (2) a 

schedule change for site assessments; and (3) the need for an 

additional site walk through.

• SCRIPS experienced a schedule overrun from February 2013 to April 

2013 because the Technical Refresh project was delayed due to 

issues with the procurement of the required and approved hardware 

and software. A baseline change request was submitted and 

approved in April 2013.

For ACA, MeF, and TSS, IRS reported the following reasons:

• ACA experienced a cost overrun for the last quarter of fiscal year. The 

overrun noted was due to a timing difference between planned 

obligations and actual contract award dates. ACA also experienced 

cost underruns throughout the first three quarters of the fiscal year. 

The underruns noted were due to (1) delays in contract awards, (2) 

re-evaluation of the needs for technical contractor support, and (3) 
Page 27 GAO-14-298 Information Technology

underrun in IRS labor because of slower than expected hiring due to 

sequestration.

• MeF experienced a cost overrun in October 2012. The variance noted 

was due to a delay in the roll out of new forms and added 

performance tuning stabilization and monitoring into the production 

system; and baseline change request submitted. Additionally, MeF 

experienced cost underruns from May 2013 to June 2013 and from 

August 2013 to September 2013. The variances noted were due to (1) 

the under-budget cost as the result of significantly lower infrastructure 

costs than originally anticipated and the decoupling of XML 

enhancement work, (2) lower infrastructure costs, (3) removal of 

scope, and (4) fewer than anticipated change requests received from 

business partners.

• Telecommunications Systems and Support experienced schedule 

overruns from November 2012 through September 2013. The 

variances noted were due to (1) delays associated with two projects—

Video Conferencing and Enterprise Electronic Fax and Networks 

Convergence, (2) construction delays associated with Hurricane 

Sandy, and (3) delays associated with the phone carrier providing toll 

free numbers. A baseline change request was submitted to address 

the schedule variance. The investment also experienced cost 

underruns from July 2013 to September 2013. The variances noted 

were due to (1) changes in project scope, (2) projected costs being 

incorrectly reported, and (3) a reduction in planned spending. A 

baseline change request was submitted to correct projected cost 

figures.
Page 28 GAO-14-298 Information Technology

The following table shows significant cost and schedule variances reported monthly for IRS’s major investments from 

October 2012 to September 2013.

Table 3: Variances for IRS’ Major IT Investments from October 2012 to September 2013

Fiscal year 2013

Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13

Affordable 

Care Act (ACA) 

Administrationa

Cost 54.83% 59.90% 27.68% -220.21%

Schedule

Account Management 

Services

Cost 11.62%

Schedule

Customer Account 

Data Engine 2 (CADE 2)

Cost

Schedule

Electronic Fraud Detection 

System

Cost 33.62% 30.23% 30.23% 27.47% 23.39% 23.39% 20.42% 20.42%

Schedule 10.34% 10.34% 10.34%

e-Services Cost 17.31% 10.01% 10.01% 10.54% 10.54%

Schedule

Foreign Account Tax 

Compliance Act

Cost 23.23% 32.52% 16.75% 16.75% 16.75% 16.75% 16.75% 16.75% 15.70%

Schedule

Individual Master File Cost 14.06%

Schedule

Information Reporting and 

Document Matching

Cost 11.60% 11.60% 13.11% 14.26% 14.26% 13.88%

Schedule

Integrated Customer 

Communication Environment

Cost 17.50% 11.87% 13.62% 17.24% 17.14%

Schedule

Integrated 

Data Retrieval System

Cost 10.83%

Schedule

Appendix III: Investment Variances Reported by IRS from 

October 2012 to September 2013
Page 29 GAO-14-298 Information Technology

Fiscal year 2013

Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13

Integrated Financial 

System/CORE Financial 

System

Cost

Schedule

Integrated Submission and 

Remittance Processing 

System

Cost

Schedule

IRS.gov – Portal Environment Cost

Schedule

IRS End User Systems and 

Services

Cost

Schedule -63.89%

Modernized e-File Cost -20.93% 16.15% 16.15% 3.72% 13.89% 13.89%

Schedule

IRS Main Frames and Servers 

Services and Support

Cost

Schedule

Implement Return Review 

Program

Cost

Schedule

IRS Telecommunications 

Systems and Support

Cost 15.92% 10.73% 10.73%

Schedule -27.35% -33.23% -33.23% -33.23% -39.32% -35.43% -35.43% -35.43% -36.83% -28.23% -28.23%

Service Center Recognition/

Image Processing System

Cost

Schedule -73.30% -29.59% -29.59%

Source: GAO analysis of IRS data.

Note: Blank cells are an indication of where a monthly variance was less than +/- 10 percent.

Positive variance indicates that cost or schedule is less than originally planned.

Negative variance indicates that cost or schedule is greater than originally planned.

a

ACA did not report monthly but quarterly during fiscal year 2013. In addition, this investment has not been included in the quarterly reports to the congressional 

committees.

Appendix III: Investment Variances Reported by IRS from October 2012 to September 2013
Appendix IV: Investment Profiles

Page 30 GAO-14-298 Information Technology

This appendix contains the profiles for the seven key investments we 

reviewed. Information contained within these profiles includes, but is not 

limited to:

• Current life-cycle phase: Life-cycle phases can be represented as 

planning; development, modernization, and enhancement; 

operations and maintenance; or mixed. Planning refers to preparing, 

or acquiring the information used to design the asset; assess the 

benefits, risks, and risk-adjusted costs of alternative solutions; and 

establish realistic cost, schedule, and performance goals for the 

selected alternative, before proceeding to full acquisition or 

termination of a project. Development, modernization, and 

enhancement refers to projects and activities that result in new 

assets/systems or projects and activities that result in changes or 

modifications to existing assets that lead to substantive 

improvements, implement legislative or regulatory requirements, or 

meet an agency leadership request. Operations and maintenance 

refers to those projects and activities that are operating in a 

production environment. Finally, mixed refers projects and activities 

that are a combination of development, modernization, and 

enhancement and operations and maintenance. Having detailed 

information allows for clear tracking of a program’s costs as it moves 

through its various life-cycle phases.

• Development methodology: This is a framework that is used to 

structure, plan, and control the process of developing an information 

system. There are a number of approaches that can be utilized by an 

investment. IRS’s Enterprise Lifecycle methodology includes the 

following approaches: waterfall, planned maintenance, iterative, and 

managed services. Waterfall is a sequential development of a 

solution with planned reviews and formal approvals required before 

continuation of work. The planned maintenance approach manages 

change in an organized manner, minimizes the disruption caused by 

frequent system changes, and increases the efficiency and 

effectiveness of the system change process. Additionally, the 

iterative approach is an adaptive development approach in which 

projects start with a conceptual vision of the solution and end with 

deployment, with repeated cycles of requirement discovery, 

development, and testing in between. Finally, the managed services 

approach is designed to capitalize on the benefits of managed 

services provided by either an outside service, internal business 

processes, and/or existing infrastructure service provider. This 

provides useful information on the requirements of how a project is to

progress through the life cycle.

Appendix IV: Investment Profiles
Appendix IV: Investment Profiles

Page 31 GAO-14-298 Information Technology

• Contract type: For purposes of this report, this can be broken down 

into two categories. The first is firm, fixed price contracts in which the 

price is not subject to any adjustments. The second is cost 

reimbursement contracts which provide for the payment of allowable 

incurred costs, to the extent prescribed in the contract. Types of cost 

reimbursement contracts include, but are not limited to (1) cost plus 

fixed fee in which actual costs and a fixed fee can be charged; 

however, costs are not allowed to exceed the agreed upon estimate 

without approval; and (2) cost plus incentive fee that provides for an 

initially negotiated fee to be adjusted later by a formula based on the 

relationship of total allowable costs to total target costs.

• Number of rebaselines: Rebaselines are changes to projects’ cost, 

schedule, and performance goals (i.e., baselines). According to 

officials, scope changes must go through a baseline change request 

process and be approved by Treasury and OMB.
Appendix IV: Investment Profiles

Page 32 GAO-14-298 Information Technology

According to IRS, the Affordable Care Act investment encompasses the

planning, development, and implementation of IT systems needed to 

support IRS’ tax administration responsibilities associated with certain 

provisions of the Affordable Care Act. Initiatives that have already been 

deployed include the initial release of the Branded Prescription Drug 

Industry Fee project and an effort intended to secure connection between 

IRS and the Department of Health and Human Services/Centers for 

Medicare and Medicaid Services (CMS) to support health insurance 

exchange open enrollment for the Fall of 2013. Future releases of the 

ACA include:

• ACA 4.0: CY2014 Information Sharing and Reporting

• ACA 4.1: CY2014 Non-Marketplace Provisions

• ACA 5.0: Filing Season 2015

• ACA 6.0: CY 2015 Compliance Activities

• ACA 6.1: Additional CY 2015 Compliance Activities

Affordable Care Act

ACA  Investment Details

Program start date: June 2010

Full operational capability: 2018

Life-cycle costs: $1.89 billion

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Iterative

Contractor/full-time equivalent mix: 35/65

Contract type: Firm fixed price/cost plus fixed 

fee

Number of rebaselines (past 2 years): 2

Source: IRS officials and IRS data.
Appendix IV: Investment Profiles

Page 33 GAO-14-298 Information Technology

CADE 2 began in 2010 as a new strategy for accelerating completion of a 

modernized database and converting to a single processing system 

sooner than CADE (which was intended to provide a modernized system 

of taxpayer accounts, with the ultimate goal of eventually replacing IMF) 

would allow. CADE 2 is expected to deliver its functionality incrementally 

through transition states. Transition state 1 includes: (1) daily batch 

processing of individual taxpayer returns provided by modifying the IMF to 

run on a daily, rather than weekly, basis; and (2) a comprehensive 

database for housing all individual taxpayer accounts and loaded with 

data from CADE and IMF to provide timelier updates of taxpayer 

information for use by IRS employees for compliance and customer 

service. Transition state 2, which IRS started in October 2010 and IRS 

plans to complete in March 2015, includes re-writing IRS’s legacy core 

tax processing applications in modern programming language, and is 

intended to increase flexibility, scalability, reliability, and security.1

According to IRS, the database component of transition state 1 has been 

in production as of May 2012, and in August 2012, daily updates to the 

database began. In addition, according to IRS, intense focus was placed 

on optimizing performance of the CADE 2 database in 2013. For 2014, 

the database will be kept in sync with the Individual Master File; data 

quality will be validated through the 2014 filing season; and risk-based 

decisions will be used to determine readiness to feed data downstream to 

other IRS systems.

 1

CADE 2 will not completely resolve IRS’s existing financial management deficiencies 

related to unpaid tax assessments. This is because CADE 2 is designed only to replace 

IRS’s IMF and not the Business Master File and resolving the financial management 

deficiencies would require addressing issues related to both master files.

CADE 2  Investment Details

Program start date: January 2010

Full operational capability: 2020

Life-cycle costs: $1.48 billion

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Waterfall/ Iterative

Contractor/full-time equivalent mix: 54/46

Contract type: Cost plus fixed fee/firm fixed

price

Number of rebaselines (past 2 years): 5

Source: IRS officials and IRS data.

Customer Account Data 

Engine 2 (CADE 2)
Appendix IV: Investment Profiles

Page 34 GAO-14-298 Information Technology

e-Services is a suite of web-based products that are intended to allow tax 

professionals and payers to conduct business with IRS electronically. 

These services are only available to tax practitioners, registered agents, 

and other third parties and are not available to the general public. The 

program is available via the Internet 24 hours a day, 7 days a week, and it 

contains products such as registration, an e-file application, a Transcript 

Delivery System (a system which tax professionals may use to request 

and receive account transcripts, wage and income documents, tax return 

transcripts, and verification of non-filing letters), and Taxpayer 

Identification Number Matching (a pre-filing service which allows 

authorized payers to match up to 25 payee taxpayer identification number 

and name combinations against IRS records prior to submitting an 

information return).

e-Services

e-Services  Investment Details

Program start date: August 2011

Full operational capability: Not applicable

Life-cycle costs: $211.43 million

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Planned 

maintenance 

Contractor/full-time equivalent mix: 50/50 

Contract Type: Cost-plus incentive fee and 

fixed price

Number of rebaselines (past 2 years): 0

Source: IRS officials and IRS data.
Appendix IV: Investment Profiles

Page 35 GAO-14-298 Information Technology

IRDM is aimed at helping close the tax gap—the difference between what 

business taxpayers should have paid and actually did. It is intended to 

improve voluntary compliance and accurate reporting of income by 

establishing a new business tax return and information returns that focus 

on merchant card payments and securities basis reporting. IRDM 

supports IRS business utilizing information systems that sort, match, 

identify, manage, and report on returns that are likely sources of tax gapreducing revenue. To accomplish this, IRS requires operational resources 

and systems to be put in place to implement business and technology 

changes that are intended to expand and improve its automated matching 

of data on information returns to the data submitted on tax returns filed. 

The program consists of the following five projects that the IRS 

implemented in 2011 and 2012:

• Data Assimilation: Identifies the link between tax forms and 

information returns filed for the same taxpayer to identify potential 

under-reporter cases. The project then groups these into specific 

categories to support IRS compliance programs associated with 

merchant card payments, securities cost basis, and government 

payments.

• Data Correlation: Matches tax return and information return data and 

applies business rules to identify potential under-reporter cases for 

use in the IRDM case selection process. After case selection, Data 

Correlation builds a complete case record for analysis by a tax 

examiner to support IRS compliance programs.

• Business Master File Analytics: Provides IRS users the ability to 

define and execute logic for the intelligent selection of business 

taxpayer case inventory to ensure cases selected result in the largest 

financial return.

• Case Inventory Selection and Analytics: Provides IRS users the 

ability to define and execute logic for the intelligent selection of 

individual taxpayer case inventory and creates an analytical 

environment that offers a greater ability to evaluate case data to 

improve the selection of cases worked.

• Case Management: Enables IRS users to manage and work 

business cases selected through Business Master File Analytics with 

identified discrepancies that could potentially affect tax liability.

Information Reporting and 

Document Matching 

(IRDM)

IRDM  Investment Details

Program start date: August 2010

Full operational capability: Not applicable

Life-cycle costs: $186.49 million

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Waterfall

Contractor/full-time equivalent mix: 33/67 

Contract type: Cost plus fixed fee/firm fixed 

price

Number of rebaselines (past 2 years): 2

Source: IRS officials and IRS data.
Appendix IV: Investment Profiles

Page 36 GAO-14-298 Information Technology

The IRS.Gov investment consists of a public user portal—IRS.Gov, a 

registered user portal, and an employee user portal. The key goals of the 

program include simplifying and transforming the user web experience, 

consolidating and advancing IRS web technology to industry standards, 

implementing a high-performing contract structure and terms, and 

marketing competitive costs throughout the program’s life cycle.

Additionally, this effort supports the framework and functionality of IRS 

portals services used by the American taxpayer, IRS employees, and 

registered users. The overall objectives of this program are to:

• provide a high-performing partnership between IRS and its contractor;

• provide industry-leading web practices and innovations;

• provide a compelling program performance management framework;

• create a new IRS web environment that is the trusted taxation 

website;

• Create a simple and manageable IRS web environment;

• provide single point, end-to-end operational accountability and 

visibility;

• provide a cost effective and affordable program cost structure; and

• transition successfully from the old programs to the new program.

IRS .Gov

IRS.Gov  Investment Details

Program start date: July 2009

Full operational capability: 2020

Life-cycle costs: $612.03 million

Current life-cycle phase: Mixed 

(development/operations and 

maintenance)

Development methodology: Managed 

Services

Contractor/full-time equivalent mix: 92/8

Contract type: Firm fixed price and 

time/materials

Number of rebaselines (past 2 years): 11 

Source: IRS officials and IRS data.
Appendix IV: Investment Profiles

Page 37 GAO-14-298 Information Technology

MeF is the primary system to receive and process all tax returns 

submitted electronically. When MeF receives an electronic tax return, the 

system determines if it satisfies the acceptance rules required for further 

processing. MeF is intended to benefit the tax preparation community and 

enables the IRS to answer questions quickly and helps to resolve issues. 

MeF is also intended to benefit corporations and tax-exempt 

organizations that must file tax returns or annual information returns 

electronically and is intended to reduce the handling/mailing of 

voluminous paper returns.

MeF stores all tax return data in Extensible Markup Language format in a 

Modernized Tax Return Database, allowing authorized IRS viewers (IRS 

Help Desk personnel and tax examiners) to see tax returns securely 

online. According to IRS, as of September 10, 2013, taxpayers used MeF 

to submit over 223 million individual returns and nearly 15 million 

business returns.

Release 9, which IRS planned to deploy for Filing Season 2014, is 

intended to add the Employment/Unemployment Tax family of forms 

(Forms 94x) and the U.S. Income Tax Return for Estates and Trusts 

(Form 1041) to the MeF environment, as well as a new Return Review 

Program interface.

Modernized e-file (MeF)

MeF  Investment Details

Program start date: November 2005

Full operational capability: Not applicable

Life-cycle costs: $575.30 million

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Planned 

Maintenance/Waterfall

Contractor/full-time equivalent mix: 

Information not available

Contract type: Firm fixed price/cost 

reimbursement/cost plus fixed fee/cost plus 

incentive fee

Number of rebaselines (past 2 years): 3

Source: IRS officials and IRS data.
Appendix IV: Investment Profiles

Page 38 GAO-14-298 Information Technology

RRP is a web-based automated system that is currently in development, 

and is intended to replace the legacy Electronic Fraud Detection System 

(EFDS) built in the mid-1990s. It is intended to deliver functionality 

incrementally through transition states. Transition State 1 is scheduled to 

be completed in March 2014. Transition State 2, the final transition state, 

is scheduled to be completed in March 2015. RRP is to provide, among 

other things, the following functionality:

• enable more effective routing of returns;

• detect noncompliant and fraudulent returns;

• ensure timely issuance of refunds and credits;

• prevent issuance of refunds and credits not legally due to filers; and

• streamline business processes used by the IRS criminal investigative 

analysts, aids, and civil employees.

The new system is comprised of three major activities:

• Detection. The system will incorporate several existing models as 

well as new models to enhance detection of probable 

noncompliance. Using algorithms and business rule sets, the system 

will detect questionable information on each return as the return is 

processed. The system will also detect returns with potential fraud 

characteristics, thereby allowing criminal investigators to link and 

analyze groups of returns to identify schemes for potential criminal 

prosecution.

• Resolution. The system will accommodate existing treatment 

streams and new treatment streams. Returns will be routed 

systemically to the best treatment stream, opened into the treatment 

stream’s inventory and, if applicable, the system will send an initial 

contact letter to the taxpayer.

• Prevention. The system will automatically integrate the results of 

each return’s resolution into the detection models. The results can be 

used to help target education and outreach efforts to taxpayers and 

preparers on how to avoid unintentional noncompliance. The system 

will also allow analysis and identification of fraud and noncompliance 

not identified by the predictive detection models.

Return Review Program 

(RRP)

RRP  Investment Details

Program start date: April 2010

Full operational capability: Time frame not 

available

Life-cycle costs: $169.13 million

Current life-cycle phase: Mixed 

(development/operations and maintenance)

Development methodology: Waterfall

Contractor/full-time equivalent mix: 55/45

Contract type: Cost plus incentive

Number of rebaselines (past 2 years): 1

Source: IRS officials and IRS data.
Appendix V: Comments from the Department 

of the Treasury

Page 39 GAO-14-298 Information Technology

Appendix V: Comments from the Department 

of the Treasury
Appendix V: Comments from the Department 

of the Treasury

Page 40 GAO-14-298 Information Technology
Page 41 GAO-14-298 Information Technology

David A. Powner, (202) 512-9286 or pownerd@gao.gov

In addition to the contact name above, individuals making contributions to 

this report included Sabine Paul (Assistant Director), Mary Evans, 

Rebecca Eyler, Paul Middleton, and Bradley Roach.

Appendix VI: GAO Contact and Staff 

Acknowledgements

GAO Contact

Staff 

Acknowledgements

(311291)
The Government Accountability Office, the audit, evaluation, and 

investigative arm of Congress, exists to support Congress in meeting its 

constitutional responsibilities and to help improve the performance and 

accountability of the federal government for the American people. GAO 

examines the use of public funds; evaluates federal programs and 

policies; and provides analyses, recommendations, and other assistance 

to help Congress make informed oversight, policy, and funding decisions. 

GAO’s commitment to good government is reflected in its core values of 

accountability, integrity, and reliability.

The fastest and easiest way to obtain copies of GAO documents at no 

cost is through GAO’s website (http://www.gao.gov). Each weekday 

afternoon, GAO posts on its website newly released reports, testimony, 

and correspondence. To have GAO e-mail you a list of newly posted 

products, go to http://www.gao.gov and select “E-mail Updates.”

The price of each GAO publication reflects GAO’s actual cost of 

production and distribution and depends on the number of pages in the 

publication and whether the publication is printed in color or black and 

white. Pricing and ordering information is posted on GAO’s website, 

http://www.gao.gov/ordering.htm. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or 

TDD (202) 512-2537.

Orders may be paid for using American Express, Discover Card, 

MasterCard, Visa, check, or money order. Call for additional information.

Connect with GAO on Facebook, Flickr, Twitter, and YouTube.

Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts.

Visit GAO on the web at www.gao.gov.

Contact:

Website: http://www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470

Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-

4400, U.S. Government Accountability Office, 441 G Street NW, Room 

7125, Washington, DC 20548

Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548

GAO’s Mission

Obtaining Copies of 

GAO Reports and 

Testimony

Order by Phone

Connect with GAO

To Report Fraud, 

Waste, and Abuse in 

Federal Programs

Congressional 

Relations

Public Affairs

Please Print on Recycled Paper.