Federal Election 
 

Commission
 

Office of the 
 

Inspector General 
 

999 E Street, N.W., Suite 940 

Washington, DC 20463 

October 1, 2006 – March 31, 2007 
 

May 2007 
 





________________________________________________________________________ 

TABLE OF CONTENTS 
 

EXECUTIVE SUMMARY---------------------------------------------------------- 1 
 
 

THE FEDERAL ELECTION COMMISSION-------------------------------- 4 
 
 

OIG AUDIT ACTIVITY------------------------------------------------------------- 6 
 
 

OIG INSPECTION ACTIVITY--------------------------------------------------- 14 
 

OIG HOTLINE COMPLAINTS-------------------------------------------------- 16 
 

OIG INVESTIGATIONS----------------------------------------------------------- 16 
 

ADDITIONAL OFFICE OF INSPECTOR GENERAL 
 

ACTIVITY------------------------------------------------------------------------------ 17 
 

OIG CONTACTS--------------------------------------------------------------------- 18 
 

ECIE AND PCIE ACTIVITY----------------------------------------------------- 19 
 

REPORTING REQUIREMENTS----------------------------------------------- 21 
 

TABLE I - QUESTIONED COSTS--------------------------------------------- 22 
 

TABLE II - FUNDS PUT TO BETTER USE-------------------------------- 23 
 

TABLE III - SUMMARY OF AUDIT REPORTS WITH

 CORRECTIVE ACTIONS OUTSTANDING 
 

FOR MORE THAN SIX MONTHS-------------------------- 24 
 

FEC/OIG STRATEGIC PLAN – FY 2005-2010---------------------------- 25 
 

CONTACTING THE OFFICE OF INSPECTOR 
 

GENERAL----------------------------------------------------------------------------- 26 
 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 
________________________________________________________________________________________________ 

Executive Summary 

The Inspector General Act of 1978, as amended, states that the Inspector General is 

responsible for conducting audits, inspections, investigations, and recommending policies 

and procedures that promote economic, efficient, and effective use of agency resources 

and programs that prevent fraud, waste, abuse and mismanagement. The IG act also 

requires the Inspector General to keep the Commission and Congress fully and currently 

informed about problems and deficiencies in the Commission’s operations and the 

necessity for corrective action. 

This semiannual report includes the major accomplishments of the Office of Inspector 

General, as well as relevant information regarding additional OIG activities. The 

executive summary highlights the most significant activities of the OIG. Additional 

details pertaining to each activity can be found in subsequent sections of this report. 

The Audit of the FEC’s Fiscal Year 2006 Financial Statements – OIG-06-02 

was completed and released November, 2006. Under a contract supervised by 

the OIG, the independent certified public accounting firm Clifton Gunderson LLP 

(CG-LLP) performed the audit of the FEC’s FY 2006 financial statements. The 

OIG was responsible for 1) reviewing the auditors approach and planning of the 

audit; 2) evaluating the qualifications and independence of the auditors; 3) 

monitoring the work of the auditors; 4) examining audit documents and reports to 

ensure compliance with Government Auditing Standards, and OMB Bulletin No. 

01-02 Audit Requirements for Federal Financial Statements; and 5) other 

procedures the OIG deems necessary to oversee the contract and audit. 

The results of the financial statement audit were detailed in three reports: 

Opinion on the Financial Statements; Report on Internal Control; and the Report 

on Compliance with Laws and Regulations. The results of CG-LLP’s tests of 

compliance with laws and regulations described in the audit report disclosed no 

instances of noncompliance with the laws and regulations that are required to be 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 1 
________________________________________________________________________________________________ 

reported under Government Auditing Standards and OMB Bulletin No. 06-03 (see 

the section entitled OIG Audit Activity located on page 6) 

The Audit of the FEC’s Employee Transit Benefit Program – OIG-06-01 – 

February, 2007 was also completed and released during this reporting period. 

The OIG initiated the audit of the FEC’s Employee Transit Benefit Program in 

response to a 2005 OIG hotline complaint alleging that some participants received 

transit benefits while on extended business travel, which is a violation of FEC 

policy. 

The OIG conducted the audit with the objectives of assessing program policies 

and operating procedures for compliance with applicable regulations; verifying 

employee compliance with program participation requirements; and ensuring that 

the appropriate internal controls are in place. The OIG concluded that the FEC’s 

Employee Transit Benefit Program policy is compliant with the intent of Federal 

regulations, to encourage employees’ commute on mass transit. However, the 

OIG made 25 recommendations to aid in improving management of the transit 

benefit program (see the section entitled OIG Audit Activity located on page 11) 

On June 23, 2006, the Office of Management and Budget (OMB) issued Memorandum 

M-06-16, Protection of Sensitive Agency Information recommending agencies take all 

necessary and reasonable measures to protect personally identifiable information (PII), 

and swiftly eliminate significant vulnerabilities to the sensitive information entrusted to 

them. 

During the previous reporting period, the OIG, in conjunction with Clifton Gunderson 

LLP, completed phase one of this two part inspection to ensure FEC’s compliance with 

OMB Memorandum M-06-16. During this period the OIG completed phase two and 

provided FEC management with the Inspection Report on Personally Identifiable 

Information (PII) – OIG-06-04 – November, 2006. The inspection included only 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 2 
________________________________________________________________________________________________ 

controls as they relate to the protection of sensitive Commission information and did not 

include controls of computer processing beyond protecting this data (see the section 

entitled OIG Inspection Activity located on page 14). 

At the end of this period, the OIG had eleven hotline complaints at various stages; seven 

pending; two in progress; and two closed, with one being referred to management for 

administrative action (see the section entitled OIG Hotline Complaints located on page 

16). 

The audits performed by the OIG are conducted in accordance with the Government 

Auditing Standards issued by the Government Accountability Office (GAO). The 

investigations carried out by the OIG comply with the Quality Standards for 

Investigations developed by the President’s Council on Integrity and Efficiency (PCIE) 

and the Executive Council on Integrity and Efficiency (ECIE). 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 3 
________________________________________________________________________________________________ 

The Federal Election Commission 

In 1975, Congress created the Federal Election Commission (FEC) to administer and 

enforce the Federal Election Campaign Act (FECA). The duties of the FEC, an 

independent regulatory agency, are to disclose campaign finance information; enforce the 

provisions of the law; and oversee the public funding of Presidential elections. 

The Commission is made up of six members, who are appointed by the President and 

confirmed by the Senate. At present there are five members - the current Chairman and 

Vice Chairman of the Federal Election Commission are Robert D. Lenhard and David M. 

Mason respectively. The remaining three Commissioners are Hans A. von Spakovsky, 

Steven T. Walther, and Ellen L. Weintraub. Each member serves a six-year term, and 

two seats are subject to appointment every two years. By law, no more than three 

Commissioners can be members of the same political party, and at least four votes are 

required for any official Commission action. The Chairmanship of the Commission 

rotates among the members each year, with no member serving as Chairman more than 

once during his or her term. 

Office of Inspector General 

The Inspector General Act of 1978 (P.L. 100-504), as amended in 1988, states that the 

Inspector General is responsible for: 1) conducting and supervising audits and 

investigations relating to the Federal Election Commission’s programs and operations; 2) 

detecting and preventing fraud, waste, and abuse of agency programs and operations 

while providing leadership and coordination; 3) recommending policies designed to 

promote economy, efficiency, and effectiveness of the establishment; and 4) keeping the 

Commissioners and Congress fully and currently informed about problems and 

deficiencies in FEC agency programs and operations, and the need for corrective action. 

The mission of the OIG is to be an independent, objective voice that aids the Commission 

by promoting positive change, accountability and integrity. An inventory of suggested 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 4 
________________________________________________________________________________________________ 

audits, investigations, and inspections received from a variety of sources is maintained. 

The most important challenges are identified and the final step is to plan and conduct 

audits, investigations, and inspections that address those challenges. 

All Commission offices are responsible for monitoring and evaluating the programs 

entrusted to them and reporting information or incidences, needing further audit and/or 

investigation, to the Inspector General. The OIG will continue its commitment to work 

with the Commission to ensure the efficiency, effectiveness, and integrity of agency 

programs. We are proud of our past accomplishments and expect our future endeavors 

will be significant in combating fraud, waste, abuse, and mismanagement within the 

Federal Election Commission. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 5 
________________________________________________________________________________________________ 

OIG Audit Activity 

Audit of the Federal Election Commission’s Fiscal Year 2006 Financial 

Statements 

Assignment Number: OIG – 06-02 

Release Date: November, 2006 – http://www.fec.gov/fecig/financial06.pdf 

Financial audits provide assurance as to whether the agency’s financial statements 

fairly present the financial position of the agency’s programs and costs of 

operations. In addition, the financial statement reports on the internal controls 

that support accurate financial reporting and compliance with applicable laws and 

regulations. 

In accordance with the Accountability of Tax Dollars Act of 2002, the FEC 

prepared financial statements for the 2006 fiscal year in accordance with Office of 

Management and Budget (OMB) Circular No. A-136, Financial Reporting 

Requirements. The Chief Financial Officers Act of 1990 (Public Law 101-576, 

commonly referred to as the “CFO Act”), as amended, requires the FEC IG, or an 

independent external auditor selected by the Inspector General, to audit the 

agency financial statements. 

Under a contract supervised by the OIG, the independent certified public 

accounting firm Clifton Gunderson LLP (CG-LLP) performed the audit of the 

FEC’s FY 2006 financial statements. The OIG was responsible for 1) reviewing 

the auditors approach and planning of the audit; 2) evaluating the qualifications 

and independence of the auditors; 3) monitoring the work of the auditors; 4) 

examining audit documents and reports to ensure compliance with Government 

Auditing Standards, and OMB Bulletin No. 01-02 Audit Requirements for Federal 

Financial Statements; and 5) other procedures the OIG deems necessary to 

oversee the contract and audit. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 6 
________________________________________________________________________________________________ 

The results of the financial statement audit were detailed in three reports: 

Opinion on the Financial Statements; Report on Internal Control; and the Report 

on Compliance with Laws and Regulations. 

Opinion on the Financial Statements: 

The audit included an examination, on a test basis, of evidence supporting 

the amounts and disclosures in the financial statements. The audit also 

included assessing the accounting principles used and significant estimates 

made by management, as well as evaluating the overall principal 

statements’ presentation. 

In addition CG-LLP audited the balance sheets of the Federal Election 

Commission as of September 30, 2006 (FY 2006) and 2005 (FY 2005), 

and the related statements of net cost, changes in net position, budgetary 

resources, financing, and custodial activity for the years then ended. 

In FY 2006 and 2005, CG-LLP was not able to obtain sufficient 

competent audit evidence to support the allocation of program costs 

reported on the statements of net cost. As a result, CG-LLP was not able 

to apply auditing procedures necessary to conduct the audit in accordance 

with the standards and the OMB guidance mentioned above. Therefore, 

CG-LLP issued a qualified opinion on the statements of net cost. 

Report on Internal Control: 

CG-LLP’s planning and performance of the audit included consideration 

of the FEC’s internal control over financial reporting. The CG-LLP 

auditors obtained an understanding of the FEC’s internal control; 

determined whether internal controls had been placed in operation; 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 7 
________________________________________________________________________________________________ 

assessed control risk; and performed tests of controls in order to determine 

auditing procedures for the purpose of expressing an opinion on the 

financial statements. The auditors limited their internal control testing to 

those controls necessary to achieve the objectives described in OMB 

Bulletin No. 06-03 and consequently CG-LLP did not provide an opinion 

on internal control. 

Internal control as it relates to the financial statements, is a process, 

affected by agency’s management and other personnel, designed to 

provide reasonable assurance of the following: 1) transactions are 

properly recorded, processed, and summarized to permit preparation of the 

financial statements and assets are safeguarded against loss from 

unauthorized acquisition, use or disposition; 2) transactions are executed 

in accordance with laws governing the use of budget authority and other 

laws and regulations that could have a direct and material effect on the 

financial statements and other laws and regulations identified by OMB; 

and 3) transactions and other data that support reported performance 

measures are properly recorded, processed, and summarized to permit the 

preparation of performance information in accordance with criteria stated 

by management. 

In performing the testing of internal control necessary to achieve the 

objectives in OMB Bulletin No. 06-03, the auditors identified matters 

relating to significant deficiencies in the design or operation of FEC’s 

internal control. The testing of internal control identified both reportable 

conditions and material weaknesses. The American Institute of Certified 

Public Accountants (AICPA) categorizes reportable conditions as matters 

coming to the auditor’s attention relating to significant deficiencies in the 

design or operation of the internal control that, in the auditor’s judgment, 

could adversely affect the agency’s ability to record, process, summarize, 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 8 
________________________________________________________________________________________________ 

and report financial data consistent with the assertions by management in 

the financial statements. 

Material weaknesses are reportable conditions in which the design or 

operation of one or more of the internal control components does not 

reduce to a relatively low level the risk that misstatements caused by error 

or fraud in amounts that would be material in relation to the financial 

statements being audited may occur and not be detected within a timely 

period by employees in the normal course of performing their assigned 

functions. 

Report on Compliance with Laws and Regulations: 

FEC management is responsible for complying with laws and regulations 

applicable to the agency. To obtain reasonable assurance about whether 

FEC’s financial statements are free of material misstatements, CG-LLP 

performed tests of compliance with certain provisions of laws and 

regulations, non-compliance with which could have a direct and material 

effect on the determination of financial statement amounts, and certain 

laws and regulations specified in OMB Bulletin No. 06-03, such as the 

Anti-Deficiency Act and the Prompt Payment Act. 

The results of CG-LLP’s tests of compliance with laws and regulations 

described in the audit report disclosed no instances of noncompliance with 

the laws and regulations that are required to be reported under 

Government Auditing Standards and OMB Bulletin No. 06-03. 

In addition to the three reports issued in relation to the FY 2006 audit, a 

management letter discussing certain conditions involving the various accounting, 

operating, and procedural matters as they relate to the FEC was issued. 

Additionally, the OIG performed an evaluation of CG-LLP’s audit performance 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 9 
________________________________________________________________________________________________ 

and the evaluation disclosed no instances where CG-LLP did not comply with 

Government Auditing Standards. 

The FEC’s continued commitment to sound financial management resulted in 

improvement in several areas during fiscal year 2006. The FEC implemented a 

new cost allocation process in fiscal year 2006. The Inspector General believes 

the new system will yield further improvements in internal controls and reporting 

of FEC program costs in fiscal year 2007 and beyond. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 10 
________________________________________________________________________________________________ 

OIG Audit Activity (continued) 

Audit of the Commission’s Employee Transit Benefit Program 

Assignment Number: OIG – 06-01 

Release Date: February, 2007 

During this reporting period the OIG completed and released the Audit of the 

Commission’s Employee Transit Benefit Program. The OIG initiated the audit 

of the FEC’s Employee Transit Benefit Program in response to a 2005 OIG 

hotline complaint alleging that some participants received transit benefits while 

on extended business travel, which is a violation of FEC policy. The FEC’s 

Employee Transit Benefit Program is a subsidy intended to encourage employees 

to commute to and from work by means other than single-occupant vehicles. The 

employee benefit program had not been reviewed since 1994 and considering the 

cash equivalent nature of the program benefits and the complaint, the OIG 

believed that an audit of the program would be beneficial. 

The OIG conducted the audit with the objectives of assessing program policies 

and operating procedures for compliance with applicable regulations; verifying 

employee compliance with program participation requirements; and ensuring that 

the appropriate internal controls are in place. The audit fieldwork was conducted 

between February 2006 and November 2006. The audit scope included a review 

of program activity from January 2003 through July 2006. 

FEC Directive 54, Employee Transit Benefit Program, dated August 2001, 

requires employees to reduce their monthly transit benefit when they do not take 

public transportation for the majority of the month. The OIG’s audit substantiated 

the OIG hotline complaint allegation that some employees were not adhering to 

the program directive. In fact, 50 employees inappropriately claimed $2,494 in 

transit benefits of which they were not entitled given their extended absence from 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 11 
________________________________________________________________________________________________ 

the FEC. According to the program directive, it is the employee’s responsibility 

to reduce the transit benefit received in the event of an extended absence from the 

office. Clear program policies and procedures needed to be developed to provide 

participants with specific instructions on how adjustments should be made. 

Furthermore, the OIG discovered three employees who were allowed to 

inappropriately participate in both the transit benefit program and the subsidized 

parking program. The three employees had been issued an FEC paid parking 

permit and also received the transit subsidy for several months during the period 

reviewed. In fact, two of the three employees worked in one of the program 

offices responsible for administering the Employee Transit Benefit Program. 

Although the practice was not consistent with the program directive, the OIG 

found no evidence of misuse of the benefit by the three employees. 

The OIG concluded that the FEC’s Employee Transit Benefit Program policy is 

compliant with the intent of Federal regulations, to encourage employees’ 

commute on mass transit. However, the OIG believes that the current directive 

needs to be improved since the policy does not include guidelines for proper 

management of SmartBenefits. Moreover, the OIG noted that the FEC 1) does 

not have written operating procedures to effectively implement program policy; 2) 

program staff did not always follow the provisions of the program’s policy; and 3) 

program documentation was not properly maintained. 

Additionally, the OIG found the program office failed to properly suspend and 

remove program participants upon separation from the agency. As a result, 

former employees no longer eligible for the benefit had access to $30,935 in FEC 

funds, of which $1,972 was inappropriately claimed by former employees. 

Further, while reviewing employee separations, the OIG also identified three 

ineligible employees who claimed $527 in transit subsidies while on 

administrative leave. The OIG identified several employees who separated from 

the agency, but failed to return $2,101 of unused transit benefits. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 12 
________________________________________________________________________________________________ 

The program’s internal control system needs strengthening to ensure that unused 

subsidies are returned by separating employees, former employees are promptly 

removed from the list of eligible transit subsidy recipients and that ineligible 

persons do not have access to FEC transit benefits. Considering this, the OIG 

made 25 recommendations to aid in improving management of the transit benefit 

program. 

Management generally agreed with the audit findings and recommendations, and 

plans to implement corrective action to address the weaknesses noted during the 

audit. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 13 
________________________________________________________________________________________________ 

OIG Inspection Activity: 

Inspection Report on Personally Identifiable Information (PII) 
 

Assignment Number: OIG – 06-04 
 

Release Date: November, 2006 (non-public – internal use only) 
 

During the previous reporting period, the OIG, in conjunction with Clifton 

Gunderson LLP, completed phase one of this two part inspection to ensure FEC’s 

compliance with OMB Memorandum M-06-16, Protection of Sensitive Agency 

Information. During this period the OIG completed phase two and provided FEC 

management with the Inspection Report on Personally Identifiable Information 

(PII) – OIG-06-04 – November, 2006. 

Sensitive PII is defined by OMB as “any information about an individual 

maintained by an agency, including, but not limited to, education, financial 

transactions, medical history, and criminal or employment history and 

information which can be used to distinguish or trace an individual's identity, such 

as their name, social security number, date and place of birth, mother’s maiden 

name, biometric records, etc., including any other personal information which is 

linked or linkable to an individual.” Information systems can be either electronic 

or manual. 

The inspection included only controls as they relate to the protection of sensitive 

Commission information and did not include controls of computer processing 

beyond protecting this data. The control objectives were specified by the 

President’s Council on Integrity and Efficiency (PCIE). 

Based on the evaluation of phase two, the OIG concluded that the FEC has taken 

steps to protect its sensitive personal information. Specifically, the FEC has 

categorized all portable devices as containing or processing personally 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 14 
________________________________________________________________________________________________ 

identifiable information and is designing security controls (hard drive encryption 

and password protection) to protect these devices. However, controls could be 

further enhanced to guarantee the protection of sensitive information therefore, 

the OIG provided management with four recommendations to ensure additional 

protection of PII. 

Due to the sensitive nature of the investigation, the OIG did not make the report 

available to the general public and limited distribution within the Commission. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 15 
________________________________________________________________________________________________ 

OIG hotline Complaints: 

The Office of Inspector General established a hotline to enable employees and 

others to have direct and confidential contact with the OIG. The OIG receives 

complaints through various means such as U.S. mail, telephone, e-mail, and 

personal visits to the OIG. Once a hotline complaint has been received, a 

preliminary inquiry is conducted. When the inquiry has been completed, the 

hotline complaint can be closed with no further action taken, referred to 

management for action, or closed and an investigation opened on the issue. 

HL-06-04, Alleged Misconduct, Misuse of Government Property - the OIG 

referred to the Assistant U.S. Attorney’s Office (AUSA) for the District of 

Columbia allegations of criminal misuse of government property. The AUSA 

declined to prosecute and referred the matter to the agency for administrative 

action. As a result of the AUSA’s declination, the OIG referred the matter to FEC 

management for administrative action. Management determined two employees 

had misused government cellular telephones by making unauthorized personal 

calls. One of the employees was issued a written letter of reprimand and agreed 

to repay the FEC $942.31 for the unauthorized personal calls. The other 

employee was issued an oral reprimand and agreed to repayment of $129.15. 

In a related matter, management determined a third employee had misused a 

government vehicle and cellular telephone. The employee resigned from the 

agency after being advised the agency was prepared to propose the employee’s 

removal due to the misconduct. 

At the end of this period, the OIG had eleven hotline complaints at various stages; 

seven pending; two in progress; and two closed, with one being referred to 

management for administrative action. 

OIG Investigations: 

Currently one criminal investigation is open. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 16 
________________________________________________________________________________________________ 

Additional OIG Activity: 

In addition to conducting audits, inspections, and investigations, the OIG 

performs, and is involved in a variety of other projects and activities. All 

legislation, as compiled by the Commission’s Congressional Affairs Office, is 

reviewed by the Inspector General, as required by the Inspector General Act of 

1978, as amended. The Inspector General reviews and provides comments, when 

appropriate, on all legislation provided by the PCIE/ECIE Legislative Committee. 

In addition, the Inspector General routinely reads all Commission agenda items. 

In response to a data call for the FY 2006 Progress Report to the 

President, the OIG prepared a written narrative summarizing the work 

conducted during the disclosure audit. The narrative provided a brief 

description of the review completed, applicable recommendations, and 

actions taken by management. 

The OIG reviewed and provided comments on a proposed FEC directive 

to establish standards and procedures for processing time and attendance 

information (payroll) for the FEC Commissioners. The draft directive was 

established to ensure Commissioners are paid in accordance with 

applicable laws, regulations, and guidance. The directive establishes the 

authority and accountability of officials involved in the time reporting and 

payroll process. The OIG also provided comments on a draft personnel 

instruction entitled “Disciplinary Actions.” Comments on the personnel 

instruction included input on the OIG’s responsibilities to investigate 

allegations of misconduct, fraud, waste, and abuse. 

The Inspector General met with the Advisor to the High Commissioner for 

Planning, Rabat, Morocco. The visit was arranged as part of the 

Department of States’ International Visitor Leadership Program. A 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 17 
________________________________________________________________________________________________ 

discussion of the role and responsibilities of the Inspector General was 

held. 

OIG Contacts: 

The table below is a breakdown of the total amount of contacts 

received through the Office of Inspector General for the past six 

months – October 1, 2006 – March 31, 2007. These contacts were 

made through various sources such as telephone calls, personal 

visit to the OIG, e-mails, faxes, and U.S. mail: 

Month Contacts OIG Action No Action Necessary Forwarded for 

Action 

October 173 6 164 3 

November 62 2 54 6 

December 75 1 72 2 

January 160 1 102 1 

February 46 5 60 3 

March 53 2 83 2 

TOTAL 569 17 535 17 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 18 
________________________________________________________________________________________________ 

ECIE and PCIE Activity: 

The President’s Council on Integrity and Efficiency (PCIE) and the Executive 

Council on Integrity and Efficiency (ECIE) were established May 11, 1992 by 

Executive Order 12805, and are chaired by the Office of Management and 

Budget, Deputy Director for Management. In addition to the Inspectors General, 

the councils include representatives from the Office of Personnel and 

Management, the Office of Government Ethics, the Office of Special Counsel, 

and the Federal Bureau of Investigations. 

The PCIE/ECIE have identical functions and responsibilities to coordinate and 

enhance governmental efforts to promote integrity and efficiency, and to detect 

and prevent fraud, waste and abuse in Federal programs. The PCIE is comprised 

of IGs appointed by the President of the United States. The ECIE consists of IGs 

appointed by the head of their respective agencies. 

The Inspector General is an active member of the Executive Council on Integrity 

and Efficiency and has provided input on a number of initiatives proposed by the 

Council. The ECIE serves as a forum for the exchange of views for the Inspector 

General Community. The IG attends regular meetings held by the ECIE, and the 

IG also participates in joint meetings and activities with the President’s Council 

on Integrity and Efficiency. 

The OIG staff, which consists of the Inspector General, the Deputy Inspector 

General, an Auditor (position currently vacant), and the Special Assistant to the 

Inspector General, continually seeks ways to improve their performance, skills 

and knowledge. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 19 
________________________________________________________________________________________________ 

The chart listed below depicts training, meetings, programs, seminars, and/or conferences 

attended by the Inspector General and/or the OIG staff for the period October 1, 2006 

through March 31, 2007: 

Host / Sponsor Topic / Subject 

ECIE Monthly Meetings 

PCIE Financial Statement Audit Network (FSAN) 

Meeting 

PCIE / GAO Financial Statement Audit Roundtable 

Discussion 

Association of Certified Fraud Examiners Embezzling From Employer/Bank Fraud 

Office of Government Ethics (OGE) 2007 National Government Ethics 

Conference – Strengthening the Federal 

Ethics Community 

Virginia Society of Certified Public 

Accountants 

Ethics 2006 – Your License Depends On It 

Association of Government Accountants 

(AGA) 

Leadership Meeting 

Federal Audit Executive Counsel (FAEC) Quarterly Meeting 

Inspection & Evaluation (I&E) Committee Roundtable Discussion 

SkillSoft/SkillPort IG-E Learning 

Federal Election Commission Ethics & EEO Overview 

Federal Election Commission OIG Senior Management On-Site Retreat 

Federal Election Commission Audio Seminar on Strategies to Prevent The 

Misuse of Computers in the Workplace 

Federal Election Commission Manager’s Meeting 

Federal Election Commission Strategic Career Management Seminar 

Federal Election Commission The Administrative Assistants Conference 

Federal Election Commission Administrative Liaison Group Meetings 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 20 
________________________________________________________________________________________________ 

REPORTING REQUIREMENTS 
 

Reporting requirements required by the Inspector General Act of 1978, as amended 

by the Inspector General Act Amendments of 1988 are listed below: 

IG Act Page 

Section 4(a)(2) Review of Legislation----------------------------------------- 17 

Section 5(a)(1) Significant Problems, Abuses, and 

 Deficiencies------------------------------------------------------ None 

Section 5(a)(2) Recommendations with Respect to

 Significant Problems, Abuses, and 

 Deficiencies------------------------------------------------------ None 

Section 5(a)(3) Recommendations Included in Previous 

Reports on Which Corrective Action Has 

Not Been Completed-(Table III)--------------------------- 24 

Section 5(a)(4) Matters Referred to Prosecuting 

 Authorities------------------------------------------------------- None 

Section 5(a)(5) Summary of Instances Where Information 

 was Refused------------------------------------------------------ None 

Section 5(a)(7) Summary of Significant Reports--------------------------- 6 

Section 5(a)(8) Questioned and Unsupported Costs-(Table I)---------- 22 

Section 5(a)(9) Recommendations that Funds be put

to Better Use (Table II)---------------------------------------- 23 

Section 5(a)(10) Summary of Audit Reports issued before 

the start of the Reporting Period for which

no Management Decision has been made---------------- N/A 

Section 5(a)(11) Significant revised Management Decisions-------------- N/A 

Section 5(a)(12) Management Decisions with which the

 Inspector General is in Disagreement---------------------- None 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 21 
________________________________________________________________________________________________ 

TABLE I: 

INSPECTOR GENERAL ISSUED REPORTS 
 

WITH QUESTIONED COSTS
 

DOLLAR VALUE (in thousands) 

QUESTIONED UNSUPPORTED 

NUMBER COSTS COSTS 

A. 	 For which no Management 0 0 [0]

 decision has been made by 

 commencement of the reporting 

 period 

B. 	 Which were issued during 0 0 [0]

the reporting period 

Sub-Totals (A&B) 0	 0 [0] 

C. 	 For which a Management 0 0 [0]

decision was made during 

 the reporting period 

(i) 	 Dollar value of disallowed 0 0 [0] 

 costs 

(ii) Dollar value of costs 0 0 [0]

 not disallowed 

D. 	 For which no Management 0 0 [0]

decision has been made by the 

 end of the reporting period 

E. 	 Reports for which no Management 0 0 [0]

decision was made within 

 six months of issuance 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 22 
________________________________________________________________________________________________ 

TABLE II:
 

INSPECTOR GENERAL ISSUED REPORTS WITH 

RECOMMENDATIONS THAT FUNDS BE PUT TO BETTER USE 

NUMBER DOLLAR VALUE 

(in thousands) 

A. 	 For which no Management 0 0 

decision has been made by 

the commencement of the

 reporting period 

B. 	 Which were issued during 0 0 

the reporting period 

C. 	 For which a Management 0 0 

decision was made during

the reporting period 

(i) 	 dollar value of 0 0 

 recommendations 

 were agreed to by

 Management 

based on proposed 0 0 

 Management action 

based on proposed 0 0 

 legislative action 

(ii) 	 dollar value of 0 0 

 recommendations 

that were not agreed 

 to by Management 

D. 	 For which no Management 0 0 

decision has been made by 

the end of the reporting period 

E. 	 Reports for which no 0 0 

 Management decision 

was made within six months 

 of issuance 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 23 
________________________________________________________________________________________________ 

TABLE III: 

SUMMARY OF AUDIT REPORTS WITH CORRECTIVE ACTIONS 

OUTSTANDING FOR MORE THAN SIX MONTHS 

Financial Statement Audits 

Recommendations 

Report 

Fiscal Year Number Repeat* New Closed Total 

Fiscal Year 2004 OIG-04-01 0 42 12 30 
 

Fiscal Year 2005 OIG-05-01 30 11 15 26 
 

Fiscal Year 2006 OIG-06-02 26 13 0 39 
 

* Repeat column represents recommendations from the prior fiscal year 

 report that are still applicable to the current fiscal year report. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 24 
 
FEC / OIG Strategic Plan - Fiscal Years 2005 - 2010 

OIG Products: To provide products 

and services that promote positive 

change in FEC policies, programs, and 

operations. 

OIG Process: To develop and implement 

processes, policies, and procedures to ensure 

the most effective and appropriate use of OIG 

resources in support of our people and 

products. 

OIG Staff: To maintain a skilled and motivated 

work force in an environment that fosters 

accountability, communications, teamwork, and 

personal and professional growth. 

Objective A: Deliver timely, high-quality 

products and services that promote 

positive change. 

Strategy: - establish common OIG standards for communicating 

results; 

- conduct quality assurance programs; 

- solicit appropriate internal and external review and 

comment; 

- comply with applicable statutory guidelines and 

standards; 

- set realistic and appropriate milestones. 

Objective B: Address priority issues 

and concerns of the Commission, 

Management, and Congress. 

Strategy: Perform work that supports; 

- Federal Election Commission and Congressional 

priorities; 

- Strategic Management Initiative efforts; 

Focus OIG attention in the following areas of 

emphasis: 

- managing change; 

- resource allocation in relation to policy objectives; 

- delivery of client service; 

- causes of fraud and inefficiency; and, 

- automation and communication. 

Objective C: Follow-up and evaluate 

results of OIG products and services to 

assess their effectiveness in promoting 

positive change. 

Strategy: - Identify, as appropriate, lessons learned to improve 

timeliness and quality; and, 

- conduct follow-up reviews to determine if intended 

results have been achieved. 

Objective D: Satisfy customers, 

consistent with the independent nature 

of the OIG. 

Strategy: - establish professional communication and 

interaction with customers to promote the open 

exchange of ideas; 

- incorporate customer feedback, as appropriate; and, 

- be open to customer-generated solutions and 

options. 

Objective A: Maintain a dynamic strategic 

planning process. 

Strategy: - periodically review and update the strategic plan to 

address changing OIG and FEC priorities; and, 

- identify factors that influence organizational change 

and develop short and long term plans to address them. 

Objective B: Plan and conduct costeffective work that address critical issues 

and results in positive change. 

Strategy: - solicit FEC and Congressional input in planning OIG 

activities; 

- develop internal planning mechanisms to support FEC 

goals and priorities; 

- ensure that priorities of IG are effectively 

communicated; and, 

- identify specific targets for OIG review that are the most 

cost-effective 

Objective C: Identify customer needs and 

provide products and services to meet 

them. 

Strategy: - establish new customer feed back mechanisms; 

- consider and evaluate customers feedback when 

planning and developing products and services; 

- respond to Congressional inquires and request for 

briefing and testimony; 

- promote open exchange of ideas and information 

through outreach and through use of e-mail; and, 

- receive, evaluate, and respond, as appropriate, to 

information received through the OIG hotline and other 

sources. 

Objective D: Implement efficient, effective, 

and consistent resolution and follow-up 

procedures. 

Strategy: - ensure that IG follow-up procedures are followed and 

that management is aware of their role in the process; 

- establish common OIG standards for terminology, date 

maintenance and communications. 

Objective E: Establish a positive and 

productive working environment. 

Strategy: - reengineer or streamline OIG procedures to achieve the 

most effective use of resources; and, 

- ensure that necessary technologies, evolving and 

otherwise, are made available to staff as needed. 

Objective A: Attract and retain well-qualified, 

diverse and motivated employees. 

Strategy: - develop and implement a comprehensive recruiting program 

that attracts a broad population with the knowledge, skills, 

abilities, and expertise necessary to make meaningful 

contributions to the OIG; 

- assess employee satisfaction and develop strategies to 

address employee concerns; 

- identify reasons for staff departures and develop plans to 

foster greater staff retention; and, 

- adhere to EEO principles and strive to maintain a diverse work 

force. 

Objective B: Provide training and 

developmental opportunities to employees. 

Strategy: - assess training needs in relation not only to employee but also 

office needs as well; 

- ensure that Government Auditing Standards in relation to 

training are adhered to; and, 

- maintain a reporting system to ensure that educational 

requirements are met. 

Objective C: Assess, recognize, and reward, 

when possible, performance that contributes to 

achieving the OIG mission. 

Strategy: - develop and articulate expectations for each employee's 

performance, including contributions in meeting the mission & 

goals of the OIG; and, 

- ensure that rewards, when possible, are given in recognition of 

exceptional employee performance. 

Objective D: Create and maintain a working 

environment that promotes teamwork and 

effective communication. 

Strategy: - ensure that communication between employees is open; 

- provide employees with the tools and incentives they need to 

adequately perform their duties. 

Performance Measures: Determine the 

timeliness and quality of products and 

services; their effectiveness in 

promoting positive change; and, reach 

agreement with management on at least 

90% of recommendations within six 

months of the report issue date. 

Performance Measures: An annual audit 

plan is issued; strategic plan is periodically 

reviewed; and, necessary technology is 

provided to staff to enable them to most 

efficiently perform their duties. 

Performance Measures: All employees meet 

the training requirements; all employees have 

performance standards; and all employees 

meet the basic requirements for the position in 

which they were hired to perform.

 __________________________________________________________________________________ Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 25 
________________________________________________________________________________________________ 

CONTACTING THE OFFICE OF INSPECTOR GENERAL 

The success of the OIG mission to prevent fraud, waste, and abuse depends 

on the cooperation of FEC employees (and the public). There are several 

ways to report questionable activity. 

Call us at 202-694-1015 or toll-free 1-800-424-9530. A confidential or 

anonymous message can be left 24 hours a day/7 days a week. 

Write or visit us - we are located at: 	 Federal Election Commission 

 Office of Inspector General

 999 E Street, N.W., Suite 940 

 Washington, D.C. 20463 

Mail is opened by OIG staff members only. 

You can also fax (202-501-8134) or contact us by e-mail at: oig@fec.gov. 

Website address: http://www.fec.gov/fecig/fecig.shtml 

Individuals may be subject to disciplinary or criminal action for knowingly 

making a false complaint or providing false information. 

Semiannual Report of the Federal Election Commission / OIG – October 1, 2006 – March 31, 2007 Page 26