FEC — OIG REQUIRED REVIEW UNDER THE DATA ACT

Reporting of financial and non-

Procurement award data will

subaward amount). These elements
will be reported for each subaward
linked to each award by the award ID
number (PIID or FAIN).

D1: Procurement Yes
Award Attributes | financial (i.e. period of performance, be sourced from FEC’s
and place of performance) data for procurement management
prime procurement awardee. This system (Comprizon) via
data will be reported for each unique FPDS-NG.
PIID combination of award and
award modification /amendment
number and linked to each
transaction-level obligated amount
included in File C.
D2: Grants and Reporting of financial and non- No N/A
Financial financial (i.e. award description,
Assistance Award | award title) data elements for prime
Attributes grant awardees/recipients. This data
will be reported for each unique
Federal Award identification Number
(FAIN) and linked to each
transaction level obligated amount by
the unique FAIN in File C.
E: Other Awardee | Reporting of other awardee/recipient Yes NOTE: Source system owner
Attributes data elements (i.e. legal entity name, is GSA, procurement data
address, and top 5 highly will be sourced from FPDS-
compensated officers). This data will NG (except highly
be provided for each prime awardee compensated officer which
as indicated by the awardee/recipient will come from SAM! for
unique ID (DUNS). prime awardees/ financial
assistance).
F: Subaward Reporting of sub-award data No N/A
Attributes elements (i.e. subaward number and

1 Not all award recipients are required to register in SAM. Controls and assurances associated with SAM data are
not expected to be applied to recipients who are exempt from SAM registration or who are not required to

register.

Sn a
APPENDIX A — DESCRIPTION OF DATA ACT FILES — FEC /OIG

2


OBJECTIVES, SCOPE, AND METHODOLOGY

Objectives

The primary objective of this engagement is to satisfy the OIG’s responsibilities under the DATA Act
by assessing the: (1) completeness, timeliness, quality, and accuracy of financial and payment data
submitted for publication on USASpending.gov; and (2) FEC’s implementation and use of
Government-wide financial data standards established by the OMB and the Treasury.

Scope/Methodology

This engagement was conducted as a performance audit in accordance with Generally Accepted
Government Auditing Standards (GAGAS) and modeled after the IG Review Guide. The GAGAS
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. In order to meet our audit objectives, we leveraged the work performed during our
Readiness Review as well as applicable audit work performed as part of the Fiscal Year-End
Financial Statement Audit.

The scope of this first engagement will be FEC’s fiscal year 2017, second quarter financial and award
data submitted for publication on USASpending.gov and any applicable procedures, certifications,
documentation, and controls to achieve this process. According to OMB’s MBM 2016-03, data
reported by Federal agencies in fiscal year 2017, second quarter will be displayed on
USAspending.gov by May 2017.

To accomplish the audit objectives, the engagement team:

¢ Obtained an understanding of applicable laws, legislation, directives, and any other regulatory
criteria (guidance) related to the agency’s responsibilities to report financial and award data
under the DATA Act;

e Assessed the general and application controls pertaining to the financial management systems
(e.g., financial systems, procurement) from which the data elements were derived and linked;

e Assessed the agency’s internal controls in place over the financial and award data reported to
USASpending.gov per OMB Circular A-123;

e Tested summary level data and linkages (Files A and B) from fiscal year 2017, second quarter
financial and award data submitted by the agency for publication on USASpending.gov;

e Tested 100% of award transactions included in File D for fiscal year 2017, second quarter
financial and award data, submitted by the agency for publication on USASpending.gov, by
agreeing to FEC’s underlying source records (where applicable);

e Assessed the completeness, timeliness, quality, and accuracy of the financial and award data
tested; and

Required Review Under the DATA Act Report 13|Page


APPENDIX C

Council of the

INSPECTORS GENERAL
= on INTEGRITY and EFFICIENCY

December 22, 2015

The Honorable Ron Johnson The Honorable Jason Chaffetz

Chairman Chairman

The Honorable Thomas Carper The Honorable Elijah Cummings

Ranking Member Ranking Member

Committee on Homeland Security Committee on Oversight and Government Reform
and Governmental Affairs US. House of Representatives

United States Senate Washington, D.C.

Washington, D.C.

Dear Mr. Chairmen and Ranking Members:

The Council of the Inspectors General on Integrity and Efficiency (CIGIE) recognizes and
appreciates your leadership on issues of Government transparency and accountability. In
particular, we believe the enactment last year of the Digital Accountability and Transparency Act
of 2014 (DATA Act) will significantly improve the quality of Federal spending data available to
Congress, the public, and the accountability community if properly implemented. To make sure
this happens, the DATA Act provides for strong oversight by way of the Federal Inspectors
General and the Government Accountability Office (GAO). In particular, the DATA Act
requires a series of reports from each to include, among other things, an assessment of the
completeness, timeliness, quality, and accuracy of data submitted by agencies under the DATA
Act.

I am writing this letter on behalf of CIGIE to inform you of an important timing anomaly with
the oversight requirement for Inspectors General in the DATA Act. Your staffs have been
briefed on this timing anomaly, which affects the first Inspector General reports required by the
DATA Act. Specifically, the first Inspector General reports are due to Congress in November
2016. However, the agencies we oversee are not required to submit spending data in compliance
with the DATA Act until May 2017. As a result, Inspectors General would be unable to report
on the spending data submitted under the Act, as this data will not exist until the following year.
This anomaly would cause the body of reports submitted by the Inspectors General in November
2016 to be of minimal use to the public, the Congress, the Executive Branch, and others.

To address this reporting date anomaly, the Inspectors General plan to provide Congress with
their first required reports in November 2017, a one-year delay from the due date in statute, with
subsequent reports following on a two-year cycle, in November 2019 and November 2021. We
believe that moving the due dates back one year will enable the Inspectors General to meet the

1717 H Street, NW, Suite 825, Washington, DC 20006


3. We have identified significant errors in File D1 that have contributed to our inability to give
reasonable assurance that File D1 is accurate and of quality due to the following:

a. Some of the data errors are related to government-wide data issues that appear to be related to
implementation of the Treasury DATA Broker, which the agency does not have any control
over. The Treasury’s DATA Act Program Management Office (PMO) officials confirmed that
they are aware of these issues and have taken steps to avoid these kind of errors in future
reporting periods. However, as the FEC does not have responsibility for how data is extracted
by the broker, the OIG did not evaluate the reasonableness of the Treasury’s planned
corrective action and does not plan to issue recommendations related to these issues to FEC
Management.

b. Excluding the Government-wide issues above, 89% (33 of 38) of the total awards processed
in 2nd Quarter FY 2017 had other information included in File D1 that did not agree with the
agency’s underlying sourced records (e.g., contract, service agreement, modification). The
majority of these errors are due to FEC program offices entering incorrect non-financial
information into the procurement system which is not verified by the Office of the Chief
Financial Officer (OCFO) for accuracy.

Until the deficiencies identified in this report are addressed, any efforts to assess the quality of the FEC
data submitted for File C and File D1 for publication on Beta. USAspending.gov will be limited.

The Summary of DATA Act Results can be found at page 15, and the detailed findings along with
four recommendations to help management fully implement the requirements of the DATA Act are
included in the Audit Findings and Recommendations section beginning on page 5.

Required Review Under the DATA Act Report 4|Page


FEC — OIG REQUIRED REVIEW UNDER THE DATA ACT

APPENDIX B - List of 57 Standard DATA Elements

. ELEMENT NAM F . TL 7
~ Awardee/Recipient Legal Entity | File DI and D2
Name
2, Awardee/Recipient Unique File D1, D2, E, Yes
Identifier and F
3 Ultimate Parent Unique Identifier File D1 and E Yes
4 Ultimate Parent Legal Entity Name | File Dl and E Yes
5 Legal Entity Address? File D1, D2, Yes
and F
6 Legal Entity Congressional District | File D1*, D2, Yes
and F
7 Legal Entity Country Code File D1, D2, E, Yes
and F
8 Legal Entity Country Name File D1, D2, E Yes
and F
9 Highly Compensated Officer Name File E and F Yes
10 Highly Compensated Officer Total File E and F Yes
Compensation
11 Federal Action Obligation File D1 and D2 Yes
12 Non-Federal Funding Amount File D2 No
13 Current Total Funding Obligation File D2 and F No
Amount on Award
14 Current Total Value of Award File D1 Yes
15 Potential Total Value of Award File D1 Yes
16 Type of Transaction Code File D1* and D2 Yes
17 North American Industrial File D1 and F Yes
Classification System (NAICS)
Code
18 North American Industrial File D14 and F Yes
Classification System (NAICS)
Description
19 Catalog of Federal Domestic File D2 No
Assistance (CFDA) Number
20 Catalog of Federal Domestic File D2 No
Assistance (CFDA) Title

(SSS
APPENDIX B - LIST OF 57 STANDARD DATA ELEMENTS — FEC /OIG 1


FEC — OIG REQUIRED REVIEW UNDER THE DATA ACT

‘Awarding Agency Name File DI and D2 Yes
45 Awarding Agency Code File D1 and D2 Yes
46 Awarding Sub Tier Agency Name File D1, D2, Yes
47 Awarding Sub Tier Agency Code Fen 3% Yes
and F
48 Awarding Office Name File D1 and D2 Yes
49 Awarding Office Code File D1 and D2 Yes
50 Object Class File B Yes
5] Appropriations Account’ File A, B, and C Yes
52 Budget Authority Appropriated File A Yes
53 Obligations File A, B, and C Yes
54 Unobligated Balance File A Yes
55 Other Budgetary Resources File A Yes
56 Program Activity File B Yes
57 Outlay File A, B, Yes
and C2

2 Legal Entity Address is made up of five components: Address Lines 1 and 2, City, State Code, and
ZIP+4 or Postal Code.

> TAS is made up of five components: allocation agency, agency, main account, period of availability and
availability type.

© Primary Place of Performance Address is made up of six components: Address Lines 1 and 2, City,
County, State Code, and ZIP+4 or Postal Code.

4 This element is a derived field in the respective File in accordance with the DATA Act Information Model
Schema, and thus the agency or its system(s) is not the authoritative source for the data.

© Award ID is the Procurement Instrument Identifier (PIID) for procurement, or the Federal Award
Identification Number (FAIN) for financial assistance.

' Appropriations accounts are represented by Treasury Account Symbols (TAS).

9A value may be optionally reported for this element in the respective File in accordance with the DATA
Act Information Model Schema.

Source: Federal Election Commission OIG’s analysis of the DAIMS version 1.0

APPENDIX B ~ LIST OF 57 STANDARD DATA ELEMENTS — FEC /OIG 3


APPENDIXES


Conclusion: The OIG concludes that the FEC did, in general, make proper use of the
Government-wide financial data standards with a few exceptions. However, we determined
that the FEC did not implement adequate control procedures to support the quarterly DATA.
Act submission and certification processes to ensure DATA files are complete, timely,
accurate, and of quality.

According to the DATA Act and OMB MBM-2016-03, The senior accountable official (SAO)
for each Federal agency is required to certify data files for its agency's financial and award
data to be published on USASpending. gov... Agencies are required to implement adequate
control procedures to reconcile and validate data prior to certifying and submitting data.

Cause/Effect: Although there is a SAO, the OIG believes the SAO has not been fully engaged
in the DATA Act process, which could be partially due to competing priorities, as well as a
lack of resources, which the FEC did include as a risk in their DATA Act Implementation
plan. The OIG notes that this potentially contributed to why some of the errors in File D1
were not detected and a complete File C was not submitted or certified timely.

Recommendations
3. The SAO should ensure adequate control procedures are implemented to ensure data files
are complete, accurate, timely, reconciled, and properly linked.

Management Response: Management concurs with this recommendation.

The SAO duties are currently being assumed by the Budget Director, who has been
acting as the CFO since September of 2016. In addition to this vacancy the Director
of Accounting position has been vacant since February of 2016. Currently 2 of the top
4 managerial OCFO positions are vacant and the SAO is performing the fill-in duties
of 3 managerial positions. This puts the agency at risk for missing assignments. The
Acting CFO continues to perform the SAO duties as best as possible given the
demanding workload and lack of resources.

OIG Comment: The OIG believes that if adequate resources are not assigned to this
function, the corrective actions required to address this recommendation may not be
achieved. The OIG will assess during the follow-up review process.

4. The SAO should review the validation and reconciliation documentation before certifying
DATA files submitted to the Broker.

Management Response: Management concurs with this recommendation.

OIG Comment: The OIG looks forward to reviewing corrective actions once fully
implemented by management to ensure that they fully address this recommendation.

Required Review Under the DATA Act Report 9|Page


Cause/Effect: There are several causes for the different types of errors in File D1 which

are listed below:

e Government-wide Data Reporting Issues - The OIG notes that there are several known
Government-wide data reporting issues related to the DATA Broker that are impacting
the accuracy of several standard data elements.

o Data element #14 (A)(Current Total Value of Award)> and #15(Potential Total
Value of Award)° - These data elements are extracted from the Federal
Procurement Data System — Next Generation (FPDS-NG) via the legacy
USAspending.gov and provided to the DATA Act broker (broker).” Specifically,
data for these elements are extracted from the following FPDS-NG fields
respectively: (1) base and exercised options value and (2) base and all options
value. These two fields are categorized in FPDS-NG under two columns for data
entry labeled “Current” and “Total.” The “Current” column contains amounts
entered into the system by the agency. The “Total” column contains cumulative
amounts computed by FPDS-NG based on the modification amounts entered into
the system by the agency. Procurement award modifications, included in our
sample, reported values for these elements from FPDS-NG’s “Current” column,
which displays the modification amount, rather than the “Total” column, which
displays the total award value. As a result, data for the Current Total Value of
Award and Potential Total Value of Award elements were inconsistent with
agency records. A no-cost modification would cause the “Total” column to display
an erroneous zero balance. Procurement awards (base awards) that were not
modified did not produce these same errors.

o Data element #16 (B) (Indefinite Delivery Vehicle (IDV) Type — The data from
the IDV Type element should be extracted from FPDS-NG and provided to the
broker. The FPDS-NG atom feed3 delivers the IDV Type and Contract Award
Type in the same field. The broker did not break down the data for IDV Type
which resulted in inconsistencies with agency records.

o Data element #31(Primary Place of Performance County Name) — the interface
definition document, a DAIMS artifact, states that these data elements are
extracted via Treasury’s Award Submission Portal (ASP). During fieldwork, we
noted that data for this field was consistently blank. A Treasury official explained
that data derived for Primary Place of Performance County Name would not be
implemented until September 2017. Because data for these elements were not
derived or implemented, these data fields were consistently blank and therefore not
reported for display on USAspending.gov.

5 The OMB defines the current total value of award data element as the total amount obligated to date on a contract,
including the base and exercised options.

© OMB defines Potential Total Value of award data element as the total amount that could be obligated on a contract, if
the base and all options are exercised.

7 The legacy USAspending.gov uses FPDS Version 1.4 to extract and map that data from FPDS-NG. This was a one-time
extraction for 2nd quarter transactions.

Required Review Under the DATA Act Report 6|Page


Audit Findings & Recommendations

I. Completeness, Accuracy, Timeliness, and Quality

Based on audit work performed, the OIG makes the following
conclusions for the attributes required under the DATA Act as The FEC File C
follows:

submission was
incomplete.

A. Completeness
According to the General Accountability Office (GAO),

completeness is measured in two ways: (1) all transactions that should have been

recorded are recorded in the proper reporting period and (2) the percentage of transactions

containing all applicable data elements required by the DATA Act.

Conclusion: The OIG concludes that the FEC’s File A and File B are complete. However,
because the FEC’s File C submission only included three transactions, we were unable to
test standard data elements in File C as well as the linkages between File C and B, D1, and

E, which gives assurance that all files are complete. In addition, there was a 9%

completion error rate for awards tested in File D1 (see Summary of DATA Act Results on

page 15).

Cause/Effect: The OIG was informed that the USDA (the FSSP) was having technical

difficulties prior to the due date and received a waiver/extension from OMB that

postponed its submission files. It appears that the technical issues at the FSSP could be the

cause of the FEC only submitting a partial File C. However, the OIG was unable to

confirm or substantiate whether the FSSP’s technical issues were the root cause of the

delay in FEC’s data submissions for File C to the Broker.

B. Accuracy
According to the GAO, accuracy is the percentage of

transactions that are complete and consistent with the
system(s) of record or other authoritative sources.

File D1 is not accurate

Government-wide data
issues and FEC program
office staff entering
incorrect data into
procurement system.

Conclusion: The OIG concludes that the FEC’s
summary data in File A and B is accurate. However,
because we were unable to test the standard data

which is partially related to

elements in File C and the linkages between File C
and File D1, and there was a 89% error rate (excluding the Government-wide data

reporting issues) for awards tested in File D1 (see Summary of DATA Act Results), we

cannot give reasonable assurance of the accuracy of Files C and D1.

Required Review Under the DATA Act Report 5|Page


FEC — OIG REQUIRED REVIEW UNDER THE DATA ACT

APPENDIX A — Description of DATA Act Files

A: Appropriations
Account

Reporting of account level data
elements, including budget authority
appropriated, unobligated balance,
and other budgetary resources. The
related data elements to be reported
for each Treasury Account Symbol
(TAS), excluding subaccounts, which
must agree to data reported to GTAS
(Government-wide Treasury Account
Symbol Adjusted Trial Balance
System) data used to produce the SF-
133 Report on Budget Execution and
Budgetary Resources.

Yes

USDA (FEC’s FSSP)
Financial System - Pegasys

B: Object Class
and Program
Activity

Reporting of net obligated amounts
and outlays summarized for each
unique combination of TAS (excl.
subaccount), object class, and
program activity. GTAS data used to
produce the SF-133; and Object
Class codes in section 83 of Circular
A-l1l.

Yes

USDA (FEC’s FSSP)
Financial System - Pegasys

C: Award Financial
Attributes

Reporting of prime award financial
data by unique prime awardee ID
(PIID) in agency financial systems at
the transaction level. These amounts
will be reported for each unique
combination of TAS, object class,
award ID, and award modification /
amendment number.

Yes

USDA (FEC’s FSSP)
Financial System - Pegasys

APPENDIX A ~ DESCRIPTION OF DATA ACT FILES - FEC /OIG



Management Response: Management concurs with this recommendation.

The OCFO agrees that the FEC DATA Act PMO and SAO should work with the
Financial Shared Service Provider (FSSP) to make sure all future DATA Act
submissions are submitted on time. The FEC has already communicated with the
FSSP about this issue.

OIG Comment: The OIG looks forward to reviewing corrective actions once fully
implemented by management to ensure that they fully address this recommendation.

2. The SAO should ensure that proper controls are in place to ensure all non-financial data
related to standard data elements are entered into the procurement system correctly.

Management Response: Management concurs with this recommendation.

The SAO agrees that the OCFO should ensure that proper controls are in place to
ensure the data is submitted in the system correctly. The entire agency is principally
responsible for the entering the correct data into the Procurement system. The OCFO
is working with Program Offices to provide training and awareness to the Agency on
the importance of correct procurement data.

OIG Comment: The OIG looks forward to reviewing corrective actions once fully
implemented by management to ensure that they fully address this recommendation.

II. Implementation and Use of Government-wide data standards

The FEC did not
implement control
procedures to ensure
data submissions are
complete, timely,
accurate, and of quality.

To determine whether the FEC properly implemented and made
proper use of the Government-wide financial data standards, the OIG
leveraged the work conducted during the Readiness Review, as well as
the following:

e Evaluated whether all transactions and awards, made and/or
modified after January 1, 2017, were properly recorded in File
D1;

e Evaluated whether each transaction tested contained all required standardized data
elements for that particular transaction;

e Determined whether each required data clement is presented in conformance with the
established data standard for that element;

e Evaluated the agency’s process to review the 57 standard data elements and associated
definitions established by the OMB and the Treasury. Where applicable, assessed the
agency’s efforts to communicate and resolve all data definition concerns/issues with
the USDA as well as the OMB and the Treasury; and

e Assessed the reasonableness of the agency’s process to resolve all variances and
document any unusual or unexplained variances.

Required Review Under the DATA Act Report 8|Page


Page 2

intent of the oversight provisions in the DATA Act and provide useful reports for the public, the
Congress, the Executive Branch, and others.

Although we think the best course of action is to delay the Inspector General reports, CIGIE is
encouraging the Federal Inspector General Community to undertake DATA Act “readiness
reviews” at their respective agencies well in advance of the first November 2017 report.
Through a working group, CIGIE has developed guidance for these reviews. I am pleased to
report that several Inspectors General have already begun reviews at their respective agencies,
and many Inspectors General are planning to begin reviews in the near future. We believe that
these reviews, which are in addition to the specific oversight requirements of the Act, will assist
all parties in helping to ensure the success of the DATA Act implementation.

We have kept GAO officials informed about our plan to delay the first Inspector General reports
for one year, which they are comfortable with, and our ongoing efforts to help ensure early
engagement through Inspector General readiness reviews.

Should you or your staffs have any questions about our approach or other aspects of our
collective DATA Act oversight activities, please do not hesitate to contact me at (202) 514-3435.

Sincerely,

Michael E. Horowitz
Chair, Council of the Inspectors General on Integrity and Efficiency
Inspector General, U.S. Department of Justice

cc: The Honorable David Mader, Controller, OMB
The Honorable Gene Dodaro, Comptroller General, GAO


Federal Election Commission

Office of Inspector General



In April 2017, the FEC modified the service level agreement with USDA that allows USDA to
submit Files A-C on FEC’s behalf. However, the FEC is required to certify all DATA Files.

Quarterly DATA Submissions and Certification Process

Each Federal agency is required to submit all seven Data Files (as applicable) by the 30" day after the
fiscal quarter ends. The agency designated SAO is required to certify all applicable Data Files (the
complete DATA Act submission) of its agency’s financial and award data to be published on
USASpending.gov.

According to OMB MPM2016-03,° an agency’s quarterly SAO certification should include the
following assurances:

e Assurance that the complete DATA Act quarterly submission is valid and reliable. Since a
DATA Act submission contains a combination of many data sets, the SAO will be required to
attest to the validity and reliability of the complete DATA Act submission and the
interconnectivity/linkages across all the applicable DATA files. To provide this assurance,
agencies should have internal controls in place over all of the data reported to
USASpending.gov per A-123.

¢ Confirmation that internal controls over data quality mechanisms are in place over specific
data in files, as appropriate. Existing data quality measures required by regulation and/or
OMB guidance will be sufficient for SAO reliance on individual data in files. Consistent with
MPM 2016-03, SAO’s should leverage existing validations and assurances requirements over
the data and files reported to USASpending.gov as well, as appropriate.

e Ensure data derived from authoritative sources is accurate and match the agency’s underlying
source records.

Currently the FEC’s SAO is the Acting CFO. During the period under review, the FEC SAO had not
yet implemented a certification process. The SAO plans to delegate the reconciliation and validation
process to an OCFO staff member with the assistance of the FEC’s DATA Act PMO.

IG Requirements under the DATA Act

The DATA Act also requires IGs to (1) review a statistically valid sample of spending data submitted
by their agency pursuant to the statute; and (2) report on the completeness, timeliness, quality, and
accuracy of the data, as well as the implementation and use of government-wide data standards. The
DATA Act states the first IG reports were due to Congress in November 2016, but Federal agencies
were not required to report spending data until May 2017.

° OMB MPM 2016-03 requires the Federal agency SAOs to (1) provide assurance over the information reported to
USASpending. gov; (2) leverage data quality and management controls established in statute, regulation, and
Government-wide policies; and (3) align their assurance with internal control and risk management strategies described in
OMB’s Circular A-123.

Required Review Under the DATA Act Report 11|Page


Background

On May 9, 2014, the President signed the DATA Act into law, which in part requires Federal
agencies to report, by May 2017, financial and payment data in accordance with established
Government-wide financial data standards established by the Treasury and OMB. The DATA Act
was enacted to expand the reporting requirements pursuant to the FFATA. In May 2015, the OMB
and the Treasury published 57 data definition standards (see Appendix B for list of the 57 standard
data elements) and required Federal agencies to report financial data in accordance with these
standards for DATA Act reporting, beginning January 2017. Once submitted, the data will be
displayed on USASpending. gov for taxpayers and policy makers.

Government-wide DATA Act Requirements and Implementation

The Treasury was mandated to take over USASpending. gov and thus became responsible for
determining how the data would be captured and displayed on USASpending.gov. The Treasury,
along with OMB, created the DATA Act Model Schema (DAIMS), and the interface definition
document, a DAIMS artifact. All agencies were provided this technical guidance to assist agencies
with the ability to implement, link, and report DATA Act elements to USAspending.gov via the
DATA Act Broker.

According to the DAIMS, agencies are required to submit seven data files (as applicable) to the
Broker which are (for more details about the DATA Files, see Appendix A):

File A (Appropriations Account)

File B (Program Activity & Object Class)

File C (Award Financial Attributes)

File D1 (Procurement Award Attributes)

File D2 (Grants and Financial Assistance Award Attributes)
File E (Additional Awardee Attributes)

File F (Sub-award Attributes)

NAW YND

The FEC Specific DATA Act Implementation

The FEC uses a FSSP, the USDA, for its accounting and financial reporting, and uses Comprizon (a
procurement management system) for processing and managing procurement awards. USDA’s
Financial Management Information System (FMIS) Pegasys is the main source of standard data
elements in Files A through C. Most of the standard data elements included in Files D1 are
automatically extracted from the Federal Procurement Data System — Next Generation (FPDS-NG)
via Comprizon, and most of the standard data elements included in File E are extracted from either
the Treasury’s Award Submission Portal (ASP), SAM, or FRS. The FEC does not have grants,
financial assistance awards, or sub-awardees. Therefore, some of the standard data elements do not
apply (for the list of the 57 standard data elements, see Appendix B).

Required Review Under the DATA Act Report 10|Page


The Treasury’s DATA Act PMO officials confirmed that they are aware of these issues and
have taken steps to avoid these kind of errors in future reporting periods. However, as the
FEC does not have responsibility for how data is extracted by the broker, the FEC OIG did
not evaluate the reasonableness of the Treasury’s planned corrective action and do not plan to
issue recommendations related to these issues to FEC Management.

e FEC related data errors- 89% (33 of 38) of awards included in File D1 had errors mainly
related to certain standard data elements (#5, 25, 26, 27) that did not agree to the agency’s
underlying sourced records (e.g. contract/contract modification). The OIG notes that some
financial data and most non-financial data related to awards are entered into the
procurement management system by FEC program offices during the time procurement
requests are initiated. The data entered is not verified by someone in the OCFO to ensure
accurate and proper. As a result, inaccurate data specifically related to non-financial data
may not be detected.

C. Timeliness
According to the OMB, timeliness is determined based on whether the transactions/files
were submitted and reported within 30 days of quarter-end.

Conclusion: We conclude the FEC’s data was not timely as all data files were submitted to
the DATA Broker on May 4, 2017, four days past the required due date.

Cause/Effect: The OIG notes that the FEC entered into a service agreement modification
with the USDA to have the USDA submit Files A- C on the FEC’s behalf. We were also
informed that the USDA was having technical difficulties at the due date and received a
waiver/extension from the OMB for their agency’s submission file. The FEC was also
advised to submit a waiver to the OMB. However, during the period under review, we
were unable to confirm whether an extension was approved.

D. Quality
According to the OMB, quality® focuses on the utility, objectivity, and integrity of
disseminated information.

Conclusion/Cause/Effect: We conclude that Files A and B are of quality. However, due to
the error rates found in File D1 (see Summary of DATA Act Results), scope limitations
addressed, and the government-wide issues discussed above, we are unable to assess to the
quality of the data for Files C, D1, and E.

Recommendations

1. The FEC DATA Act PMO and Senior Accountable Official (SAO) should work with the
FSSP to ensure appropriate corrective actions are implemented to ensure all future DATA
Act submissions are submitted on time and the files are complete. Also, see
recommendation number 3 below.

8 OMB’s Guidelines for Ensuring and Maximizing the Quality, Objectivity, Utility, and Integrity of Information
Disseminated by Federal Agencies (February 22, 2002).

Required Review Under the DATA Act Report 7|Page


FEC — OIG REQUIRED REVIEW UNDER THE DATA ACT

reasury ymbol
(excluding sub-account)
22 Award Description File D1, D2, Yes
and F
23 Award Modification/Amendment File D1 Yes
Number
24 Parent Award Identification (ID) | File C, D1, and Yes
Number F
25 Action Date File D1, D2, Yes
and F
26 Period of Performance Start Date File D1 Yes
27 Period of Performance Current End File D1 Yes
Date
28 Period of Performance Potential File D1 Yes
End Date
29 Ordering Period End Date File D1 Yes
30 Primary Place of Performance File D1 and F Yes
Address °
31 Primary Place of Performance File D1¢, D2, Yes
Congressional District and F
32 Primary Place of Performance File D1, D2, Yes
Country Code and F
33 Primary Place of Performance File F No
Country Name
34 Award Identification Number File C, D1, and Yes
(Award ID)* D2
35 Record Type File D2 No
36 Action Type File D1 and D2 Yes
37 Business Type File D2 No
38 Funding Agency Name File D1 and D2 Yes
39 Funding Agency Code File D1 and D2 Yes
40 Funding Sub Tier Agency Name | File D1 and D2 Yes
41 Funding Sub Tier Agency Code File D1 and D2 Yes
42 Funding Office Name File D1 and D2 Yes
43 Funding Office Code File D1 and D2 Yes

APPENDIX B — LIST OF 57 STANDARD DATA ELEMENTS — FEC /OIG 2


Based on audit work performed around the Federal Election Commission’s (FEC) 2nd Quarter FY
2017 data submissions to the Broker, the OIG concludes that the FEC did, in general, properly
implement and make proper use of the Government-wide financial data standards. We can give
reasonable assurance that the internal controls over the FEC’s sourced systems are adequate. We also
conclude that Files A and B are complete, accurate, and of quality. However, the OIG notes that none
of the FEC’s DATA files were timely submitted to the Broker. The OIG acknowledges that the FEC
is dependent on their Financial Shared Service Provider (FSSP), which is the United States
Department of Agriculture (USDA), to submit Files A through C on the FEC’s behalf. At this time,
the OIG is not able to confirm or corroborate the root cause of the delays. We also note that both the
USDA and the FEC requested an extension from the OMB/Treasury, but the OIG did not receive
confirmation if the requests were approved.

In addition, we identified several significant findings that have impacted our ability to give
reasonable assurance over the completeness, accuracy, and quality of the data submitted for Files C,
D1, and E for 2nd Quarter FY 2017 which are detailed below:

1. For the period under review, the FEC did not implement adequate controls or processes to ensure
data submitted to the Treasury Broker is complete, timely, accurate, and of quality. According to
the DATA Act and related OMB guidance, Agencies are required to implement adequate control
procedures to reconcile, validate, data prior to certifying and submitting data, The OIG notes
that the FEC listed the lack of resources and competing priorities as a risk to fully implementing
the DATA Act in their revised DATA Act Implementation Plan submitted to OMB in August
2016. If adequate resources are not assigned to this program, corrective actions to ensure DATA
submissions are complete, accurate, timely, and of quality may not be achieved.

2. Due to scope limitations, we were unable to determine the completeness and accuracy of the data
submitted for Files C and E due to the following:

a. The FEC submitted a partial File C (only three transactions) to the Broker. The OIG notes that
the FEC uses its FSSP, the USDA, for financial reporting which is the source of the data
included in File C. Therefore, the OIG was unable to assess the agency’s methodology for
ensuring that File C contains all the transactions and links that it should and contains only
those transactions that it should. Although the FEC relies on the FSSP financial system and to
transmit File C, it is important to note that the burden of this determination falls on the agency
to explain both completeness and accuracy.

b. Files E and F contain additional awardee attribute information extracted from the System for
Award Management (SAM) and/or the FFATA Sub-award Reporting System (FSRS). It is
the prime awardee’s responsibility to report sub-award and executive compensation
information in SAM and FSRS. As outlined in the OMB MPM 2016-03, the authoritative
sources for the data reported in Files E and F are SAM and FSRS, respectively, with no
additional action required of Federal agencies. As such, we did not assess the completeness,
accuracy, timeliness, and quality of the data extracted from SAM and FSRS via the DATA
Broker.

Required Review Under the DATA Act Report 3[Page


e Assessed the agency’s implementation and use of the 57 standard data elements established
by OMB and the Treasury.

Scope Limitations

The OIG is reporting several scope limitations as follows:

1. The FEC only submitted a partial (three transactions) File C for fiscal year 2017, second
quarter. Therefore, the OIG was unable to perform any testing of File C and was not able to
assess the proper linkages between File C and other data files. According to the OIG Review
Guide, File D should be used to perform detailed testing when it is determined that File C is
not suitable for testing.

2. File E contains additional awardee attribute information extracted from the System for Award
Management (SAM) via the DATA Broker, and File F contains sub-award attribute
information extracted from the FFATA Sub-award Reporting System (FSRS) via the DATA
Broker. It is the prime awardee’s responsibility to report sub-award and executive
compensation information in SAM and FSRS. Data reported from these two award reporting
systems are generated in the DATA broker for display on USASpending.gov. As outlined in
OMB MPM 2016-03, the authoritative sources for the data reported in Files E and F are SAM
and FSRS, respectively, with no additional action required of Federal agencies. As such, we
did not assess the completeness, accuracy, timeliness, and quality of the data extracted from
SAM and FSRS via the DATA Broker.

Required Review Under the DATA Act Report 14|Page


Section 4: Results of Tests Performed at the Award-Level Transactions

Description of Attribute Testing Completeness! Timeliness? Accuracy?
Error Rate* 9% 100% 89%?
Sampling Error (margin of error) N/AS N/A N/A
Source of Sample (File C, D1, D2) File D1 File D1 File D1
Population Size #38 #38 #38

(# and $ of each type of transactions $2,686,295 $2,686,295 $2,686,295
for grants, loans, contracts, and

others)

Type of Statistical Sampling

Methodology Used NIA nis a
Confidence Level N/A N/A N/A
Expected Error Rate N/A N/A N/A
Sample Precision N/A N/A N/A
Sample Size N/A N/A N/A

Section 5: Overall Assessment of Implementation and Use of Data Standards®

FEC did, in general, properly implement the DATA Act and made proper use of the
Government-wide financial data standards.

30,31

Data elements with rate of errors above 50% (Agency Specific) = 26, 36 (B)
Data elements with rate of errors above 50% (Government-wide data issues)’ = 15, 16(B) ,

requested an extension).

FSSP.

above).

e The DATA Files were not submitted on time (NOTE: FEC and USDA, FEC’s FSSP,
e File C was not complete (only 3 transactions) which could be related to technical issues at the

e The OIG was unable to test for proper award linkage between File C and other files (see

Completeness is measured as the percentage of transactions containing all data elements required by the DATA Act.

2Timeliness is measured as the percentage of transactions reported within 30 days of quarter end.

2Accuracy is measured as the percentage of transactions that are complete and agree with the systems of record or other

authoritative sources.

4Error Rate - Error rate is displayed as the percentage of transactions tested that were not in accordance with policy.

NOTE: all error rates listed exclude the errors related to known Government-wide data issues.

5FEC OIG tested 100% of procurement awards in File D1, therefore sampling methodology is not applicable.
Agency's implementation and use of data standards is assessed as part of the tests for completeness of summary-level

data and award-level transaction data.

7 Government-wide data issues are not reflected in error rates listed above.

Required Review Under the DATA Act Report

16|Page



Executive Summary

The Digital Accountability and Transparency Act of 2014 (DATA Act),! enacted in May 2014, requires
Federal agencies to report, by May 2017, financial and payment data according to data standards
established by the Office of Management and Budget (OMB) and the Department of the Treasury (the
Treasury). The DATA Act also mandates that Federal agency Offices of Inspector General (OIG)
review the efforts of their respective agencies.

Specifically, Inspectors Generals (IGs) are required to:

(1) Review a statistically valid sample of spending data submitted by their agency pursuant to the
statute; and

(2) Report on the completeness, timeliness, quality, and accuracy of the data, as well as the
implementation and use of government-wide data standards.

In May 2015, the OMB and the Treasury published 57? data definition standards (see Appendix B for
list of the 57 standard data elements) and required Federal agencies to report financial data in
accordance with these standards for DATA Act reporting, beginning in January 2017. According to
the DATA Act Model Schema (DAIMS),? agencies are required to submit seven data files (as
applicable) to the Treasury DATA Act Broker (The Broker). The seven DATA files to be submitted
to the Broker are (for more details about the DATA Files, see Appendix A):

File A (Appropriations Account)

File B (Program Activity & Object Class)

File C (Award Financial Attributes)

File D1 (Procurement Award Attributes)

File D2 (Grants and Financial Assistance Award Attributes)
File E (Additional Awardee Attributes)

File F (Subaward Attributes)

NAWRYNS

1 The DATA Act, Public Law 113-101 (May 9, 2014), requires the establishment of Government-wide standards for
information on spending by Federal agencies, and all agencies must begin reporting spending data in compliance with the
DATA Act. According to the Office of Management and Budget’s Management Procedures Memorandum (MPM) No.
2016-03, data reported by Federal agencies in fiscal year (FY) 2017 second quarter will be displayed on
USAspending.gov by May 2017.

2 Under the Federal Funding Accountability and Transparency Act of 2006 (FFATA), Federal agencies report 259 data
elements to USAspending. gov. However, the Treasury and OMB identified 49 existing elements, deemed controversial in
nature, and 8 new data elements requiring standardization. This audit only covers the 57 Government-wide financial data
standards. The 57 data elements including definitions can be found at https://fedspendingtransparency github. io/data-
elements/.

3 The DAIMS v 1.0 depicts how Federal dollars are spent. It includes, in part, a conceptual model to represent the
information domain for public reporting of Federal spending as well as technical guidance describing the submission file
formats Federal agencies are required to follow. It is described, expressed, and represented in multiple complementary
artifacts including the DATA Act elements definitions and how Data Act elements are derived, captured, and linked
between files.

4 The Treasury created the DATA Broker to capture/consolidate the required data from the agencies which will be used as
the mechanism to display on USASpending.gov.

Required Review Under the DATA Act Report 2|Page


Federal Election Commission
Office of Inspector General

Fax us at 202-501-8134 or e-mail us at 01g \ _
Visit or write to us at 999 E Street, N.W., Suite 940, Washington DC 20463)

Individuals including FEC and FEC contractor employees are encouraged to alert the OIG to
fraud, waste, abuse, and mismanagement of agency programs and operations. Individuals
who contact the OIG can remain anonymous. However, persons who report allegations are encouraged
to provide their contact information in the event additional questions arise as the OIG evaluates the
allegations. Allegations with limited details or merit may be held in abeyance until further specific details
are reported or obtained. Pursuant to the Inspector General Act of 1978, as amended, the Inspector
General will not disclose the identity of an individual who provides information without the consent of that
individual, unless the Inspector General determines that such disclosure is unavoidable during the course
of an investigation. To learn more about the OIG, visit our Website at: http://www.fec.gov/fecig/fecig.shtml

Together we can make a difference.



FEC OIG Required Review under the DATA Act

TABLE OF CONTENTS

Page

EXECUTIVE SUMMARY

AUDIT FINDINGS AND RECOMMENDATIONS

I. Completeness, Accuracy, Timeliness, and Quality

II. Implementation and Use of Government-wide data standards

BACKGROUND

OBJECTIVES, SCOPE, AND METHODOLOGY

SUMMARY OF DATA ACT RESULTS

DESCRIPTION OF DATA ACT FILES

LIST OF 57 STANDARD DATA ELEMENTS

CIGIE LETTER TO CONGRESS

10

13

15

Appendix A

Appendix B

Appendix C


Because of this timing anomaly, the Council of Inspectors General for Integrity and Efficiency
(CIGIE) sent a letter to Congress to propose delaying the first IG report until November 2017 (see
Appendix C), one year later than the statutory due date, with subsequent reports following on a two-
year cycle. To gain an understanding of the FEC’s efforts to implement the DATA Act, The FEC
OIG conducted a Readiness Review based on the DATA Act Implementation Playbook’? and issued
a Management Letter (See FEC DATA Act Readiness Review Management Letter dated December
1, 2016).

To meet the needs of the IG community, CIGIE’s Federal Audit Executive Council (FAEC)
established the DATA Act Working Group (Working Group). The Working Group’s mission is to
assist the IG community in understanding and meeting its DATA Act oversight requirements by (1)
serving as a working level liaison with the Treasury, (2) consulting with the GAO, (3) developing a
common approach and methodology, and (4) coordinating key communications with other
stakeholders. The FAEC Working Group developed the CIGIE IG Guide to Compliance Under the
DATA Act!! (The IG Review Guide).

'0 The Treasury, in coordination with the OMB, issued the DATA Act Implementation Playbook (Playbook) which
includes a detailed eight-step implementation plan (Agency 8-Step Plan).

4. ‘The IG Guide to Compliance Under the DATA Act presents a common methodological and reporting approach for the
IG community to use in performing its mandated work.

Required Review Under the DATA Act Report 12|Page


Summary of DATA Act Results

Federal Election Commission (FEC) 2" Quarter, Fiscal Year 2017

Section 1: Results of Assessment of Internal Controls over Source Systems

complete, accurate, timely, and of
quality.

Controls Controls Operating
Properly Designed to | Controls Implemented Effectively to
Achieve Control to Achieve Control Achieve Control
oo. Objective? Objective? Objective?

Control Objectives (Yes/No) (Yes/No) (Yes/No)
Overall Conclusion Yes Yes Yes
Internal controls over data
management to ensure the integrity Yes Yes Yes
and quality of the data.
Internal controls over data reporting
to re that the data reported ar

ensu data rep © Yes Yes Yes

*Auditors Note: If selected “No” in any columns above, include details in section 3.

Section 2: Results of Assessment of Internal Controls over Data Management and
Processes (DATA Act Submission)

complete, accurate, timely, and of
quality.

Controls Controls Operating
Properly Designed to | Controls Implemented Effectively to
Achieve Control to Achieve Control Achieve Control
ss Objective? Objective? Objective?
Control Objectives (Yes/No) (Yes/No) (Yes/No)
Overall Conclusion No No No
Internal controls over data
management to ensure the integrity No No No
and quality of the data.
Internal controls over data reporting
ure a. TC} ire
to ensure that the data reported ai No No No

*Auditors Note: If selected “No” in any columns above, include details in section 3.

Timeliness, and Accuracy

Section 3: Summary of Control Deficiencies and Impact on Completeness,

Impact of Control Deficiency

Description of Control Deficiency

Completeness!

Timeliness?

Accuracy?

Lack of processes to validate and
reconcile the data files to ensure
completeness, timeliness, and
accuracy

Yes

Yes

Yes

Lack of control procedures to verify
non-financial data elements entered
into the procurement system to
ensure the quality of the data.

Yes

Yes

Required Review Under the DATA Act Report

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