Semiannual Report 


to Congress 


Federal Election Commission 


Office of the 


Inspector General 


999 E Street, N.W., Suite 940 

Washington, DC 20463 

April 1, 2007 – September 30, 2007 

November 2007 

FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20.63 

November 20,2007 

OFFICE OF THE CHAIRMAN 

The Honorable Nancy Pelosi 

Speaker of the House of Representatives 

Washington, D.C. 205 15-6501 

Dear Madam Speaker: 

Pursuant to the Inspector General Act of 1978, as amended, the Federal Election 

Commission submits the Inspector General's Semiannual Report to Congress, which 

summarizes the activity of that office over the six-month period April 1,2007 through 

September 30,2007. During this reporting period the FEC's Inspector General 

commenced an audit of the FEC's fiscal year 2007 financial statements. The audit was 

completed on time and management issued the final Performance and Accountability 

Report on November 15,2007. We are pleased to report that the Commission received 

an unqualified opinion fi-om its outside auditors. We will provide additional comments 

on this audit in the next Semiannual Report to Congress. 

Further, pursuant to Section 522 of the Consolidated Appropriations Act, 2005 

(Pub. L. 108-447), the Inspector General contracted with an independent third party to 

review the agency's use of information in an identifiable form, and the agency's privacy 

and data protection polices. The privacy audit is currently underway. We anticipate that 

it will provide a baseline that will assist management in working with the IG and with 

other stakeholders to improve the agency's privacy and data protection management. 

The Commission appreciates and shares the Inspector General's commitment to 

sound financial and management practices, and we anticipate a continued cooperative 

working relationship as management takes appropriate measures to improve operations of 

the Commission. Copies of this semiannual report are being provided to the Chairman 

and Ranking Members of FEC's oversight committees. 

Sincerely, 

Robert D. Lenhard 

Chairman 

Enclosure 
MANAGEMENT REPORT ON FINAL ACTION 


ON AUDITS WITH RECOMMENDATION TO PUT FUNDS TO BETTER USE 


FOR THE SIX-MONTH PERIOD ENDING SEPTEMBER 30,2007 


Number of Funds to be Put 

Audit Reports to Better Use 

A. Audit reports for which no management 

decision has been made by the commencement 

of the reporting period 0 0 

Bi Audit reports issued during the reporting period 

C. Audit Reports for which a management decision 

was made during the reporting period 

(i) dollar value of recommendations that were 


agreed to by management 


- based on proposed management action 

- based on proposed legislative action 

(ii) dollar value of recommendations that were 


not agreed to by management 


D. Audit Reports for which no management decision 

has been made by the end of the reporting period 

E. Audit Reports for which no management decision 

was made within six months of issuance 
MANAGEMENT REPORT ON FINAL ACTION 


ON AUDITS WITH QUESTIONED COSTS 


FOR THE SIX-MONTH PERIOD ENDING SEPTEMBER 30,2007 


A. Audit reports for which no management 

decision has been made by commencement 

of the reporting period 

Number of 

Audit Reports 

0 

Questioned 

Costs 

0 

Unsupported 

Costs 

[ol 

B. Audit reports issued during the reporting period 0 0 [ol 

Subtotals (A + B) 0 0 [01 

C. Audit Reports for which a management decision 

was made during the reporting period 0 

(i) dollar value of disallowed costs 

(ii) dollar value of costs not disallowed 0 

D. Audit Reports for which no management decision 

has been made by the end of the reporting period 0 

E. Audit Reports for which no management decision 

was made within six months of issuance 0 
FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

A Message from the Inspector General 

This report summarizes the work completed by the Office of Inspector General (OIG) for 


the semiannual reporting period April 1,2007 -September 30,2007. 


During this reporting period, Congress has taken steps towards amending the Inspector 


General Act, an effort that has been ongoing for sometime. The House passed H.R. 928, 


a bill that enhances the independence of Inspectors General, establishes the Council of 


the Inspectors General on Integrity and Efficiency, and addresses the pay and bonuses of 


IGs, among other issues. The Senate appears to be moving forward on a similar bill. 


I am glad to see steps taken to address these issues. 


This has also been a very active time for the OIG with the start of the 2007 Financial 


Statement Audit, the Audit of the FEC7s Privacy Practices, and the peer review of another 


Office of Inspector General. We have also been active in the IG community, and have 


provided comments to the FEC on several issues. 


I am still concerned about the current lack of additional resources, but the Federal 


Election Commission's fiscal year 2009 budget contains a request for two additional staff 


positions for the OIG. These positions are critical to the oflice and our ability to meet all 


of our responsibilities, and I am hopeful the agency's budget will be approved with the 


requested resources. 


All staff continue to work at maximum capacity to accomplish the work of the OIG. I 


would like to thank the staff for their continued commitment and the level of 


professionalism and effort that goes into their work. 


~~nie
 A. McFarland 

Inspector General 

Federal Election Commission 

October 3 1,2007 
________________________________________________________________________ 

TABLE OF CONTENTS 

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

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

OIG AUDIT ACTIVITY------------------------------------------------------------ 5 

OIG HOTLINE COMPLAINTS------------------------------------------------- 9 

OIG INVESTIGATIONS---------------------------------------------------------- 9 

ADDITIONAL OIG ACTIVITY------------------------------------------------- 10 

ECIE AND PCIE ACTIVITY---------------------------------------------------- 12 

REPORTING REQUIREMENTS---------------------------------------------- 15 

TABLE I - QUESTIONED COSTS-------------------------------------------- 16 

TABLE II - FUNDS PUT TO BETTER USE------------------------------- 17 

TABLE III - SUMMARY OF AUDIT REPORTS WITH

 CORRECTIVE ACTIONS OUTSTANDING 

FOR MORE THAN SIX MONTHS-------------------------- 18 

FEC/OIG STRATEGIC PLAN – FY 2005-2010---------------------------- 19 

OIG CONTACTS-------------------------------------------------------------------- 20 

LIST OF TRAINING, MEETINGS, AND CONFERENCES 

ATTENDED BY OIG STAFF---------------------------------------------------- 21 

CONTACTING THE OFFICE OF INSPECTOR GENERAL--------- 22 

FEC/OIG – Semiannual Report to Congress April 1, 2007 – September 30, 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 need 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 2007 Financial Statements – OIG-07-01 

commenced during this reporting period. Under a contract monitored by the OIG, 

Clifton Gunderson LLP (CG-LLP), an independent certified public accounting firm, 

is performing the audit of the FEC’s FY 2007 financial statements. The OIG is 

responsible for the financial statement audit and oversight of the contract auditors. 

This includes: 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. 07-04 

Audit Requirements for Federal Financial Statements; and 5) other procedures the 

OIG deems necessary to oversee the contract and audit. 

During the entrance conference management, the OIG, and CG-LLP discussed the 

audit scope and ways to ensure an efficient and effective audit process for fiscal 

year 2007. A timeline was established for the audit, along with requests to 

management for necessary documentation and information concerning the financial 

FEC/OIG - Semiannual Report to Congress Page 1 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

statements (for more information see the section entitled OIG Audit Activity 

located on page 5). 

The Audit of the FEC’s Privacy Practices – OIG - 07-02 was also initiated during 

this reporting period. The Audit of the FEC’s Privacy Practices is required as a 

result of a law signed by the President on December 8, 2004, titled the Consolidated 

Appropriations Act, 2005 (Public Law 108-447). Section 522 (d) (3) of the law 

requires the Inspector General to contract with an independent third party privacy 

professional to evaluate the agency’s use of information in an identifiable form, and 

the privacy and data protection procedures of the agency. 

The OIG began plans to conduct an independent review of the FEC’s 

implementation of privacy controls. The independent review is to include (a) an 

evaluation of the agency’s use of information in identifiable form, (b) an evaluation 

of the agency’s privacy and data protection procedures, and (c) recommendations 

on strategies and specific steps to improve privacy and data protection management. 

In preparation for the contract to hire an independent, third party privacy 

professional to conduct the audit, the OIG developed and issued a statement of 

work (SOW) and awarded the contract to Cotton & Company LLP, an independent 

public accounting firm (for more information see the section entitled OIG Audit 

Activity located on page 7). 

Prior to the end of this reporting period, the OIG had one investigation currently 

underway, and ten hotline complaints (for more information see the section 

entitled OIG Hotline Complaints located on page 9). 

Also during this reporting period, the OIG conducted an audit recommendations 

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

01, released February, 2007. The purpose of audit resolution is to ensure 

management’s action plan will address the weaknesses found during the audit. The 

OIG concluded that management implemented three of the twenty-five 

FEC/OIG - Semiannual Report to Congress Page 2 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

recommendations contained in the 2007 audit report (for more information see the 

section entitled Additional OIG Activity starting on page 10). 

Additional information pertaining to the activities listed below can be found in the 

section entitled ECIE and PCIE Activity starting on page 12): 

Audit organizations conducting audits in accordance with GAGAS are required to 

have an independent peer review every three years. A schedule detailing peer 

review responsibilities between OIGs of ECIE agencies is disseminated annually. 

The FEC OIG is conducting the peer review of the Federal Finance Housing Board 

(FHFB). The objective of the peer review is to ensure an audit organization’s 

internal quality control system adequately provides reasonable assurance that 

applicable auditing standards, policies, and procedures are met (see page 13). 

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 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. 

During this past reporting period, the Inspector General was elected to the 

Executive Council of the PCIE/ECIE. The Executive Council is chaired by the 

Deputy Director of OMB for Management. The Vice Chair of the PCIE, the Vice 

Chair of the ECIE, the Chairs of the PCIE committees, and one elected member 

from the ECIE comprise the Council. The Executive Council meets quarterly and 

discusses issues that affect the IG community as a whole (see page 12). 

FEC/OIG - Semiannual Report to Congress Page 3 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

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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 

Commission and Congress fully and currently informed about problems and deficiencies in 

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

FEC/OIG - Semiannual Report to Congress Page 4 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

OIG Audit Activity: l

Title: Audit of the Federal Election Commission’s 

Fiscal Year 2007 Financial Statements 

Assignment Number: OIG – 07-01 

Status: In progress 

The Chief Financial Officers Act of 1990 (Public Law 101-576, commonly referred 

to as the “CFO Act”), as amended, requires the FEC Office of Inspector General, or 

an independent external auditor as determined by the Inspector General, to audit the 

agency financial statements. Under a contract monitored by the OIG, Clifton 

Gunderson LLP (CG-LLP), an independent certified public accounting firm, is 

performing the audit of the FEC’s FY 2007 financial statements. 

The OIG is responsible for the financial statement audit and oversight of the 

contract auditors. This includes: 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. 

07-04 Audit Requirements for Federal Financial Statements; and 5) other 

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

The entrance conference was conducted, at which time management, the OIG, and 

Clifton Gunderson, LLP, discussed the audit scope and ways to ensure an efficient 

and effective audit process for fiscal year 2007. A timeline was established for the 

audit, along with requests to management for necessary documentation and 

information concerning the financial statements. 

The OIG coordinated and participated in bi-weekly audit status meetings with CGLLP and management to discuss the progress of the audit and areas of concern. 

FEC/OIG - Semiannual Report to Congress Page 5 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

CG-LLP has started providing management with notices of findings and 

recommendations (NFR). The NFRs inform management of potential audit 

findings and allows management the opportunity to respond to the issues before the 

final audit report is released. 

The OIG also attended the SAS 99 fraud awareness meetings held with the OIG’s 

auditors and FEC management. The American Institute of Certified Public 

Accountants (AICPA) Statement on Auditing Standards number 99, Consideration 

of Fraud in a Financial Statement Audit, requires the auditors to gather information 

to identify risks of material financial misstatement due to fraud. One of the 

methods used to gain information about the risk of fraud affecting the financial 

statements, is to conduct SAS 99 fraud awareness meetings and inquire about 

management’s awareness and understanding of fraud risk. SAS 99 meetings were 

conducted with the FEC’s Staff Director, Deputy Staff Director for Management & 

Administration, Budget Officer and Chief Financial Officer. 

FEC/OIG - Semiannual Report to Congress Page 6 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

OIG Audit Activity (continued): l

Title: Audit of the FEC’s Privacy Practices 

Assignment Number: OIG – 07-02 

Status: In progress 

The Audit of the FEC’s Privacy Practices is required as a result of a law signed by 

the President on December 8, 2004, titled the Consolidated Appropriations Act, 

2005 (Public Law 108-447). Section 522 (d) (3) of the law requires the Inspector 

General to contract with an independent third party privacy professional to evaluate 

the agency’s use of information in an identifiable form, and the privacy and data 

protection procedures of the agency. The independent review is to include (a) an 

evaluation of the agency’s use of information in identifiable form, (b) an evaluation 

of the agency’s privacy and data protection procedures, and (c) recommendations 

on strategies and specific steps to improve privacy and data protection management. 

Section 522 requires the agency to have an independent third party review at least 

every two years, and requires the Inspector General to submit a detailed report on 

the review to the head of the agency. The independent third party report and related 

Inspector General reports are to be made available to the public, i.e. internet 

availability. 

Prior to the commencement of the audit, the OIG surveyed the PCIE and ECIE 

agencies to determine how many were required to conduct a 522 Privacy review. 

Based on the results, the OIG contacted the affirming agencies to determine who 

performed the review and, where possible, obtained a copy of the statement of work 

or scope, and the resulting report. The results of the survey were compiled and 

provided to all PCIE/ECIE agencies. As a result of the information gained through 

research, direct interviews, and written questions, the OIG developed the statement 

of work. 

FEC/OIG - Semiannual Report to Congress Page 7 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

Meetings were held with management to gain an understanding of the extent and 

nature of evidence to support privacy controls were in existence and working 

effectively at the FEC, and whether draft segments of the FEC Privacy Report 

would be finalized before the contractor began fieldwork. 

A formal entrance conference with key FEC personnel responsible for privacy 

activities within the Commission was held. The meeting included representatives 

from the Office of General Counsel, the Information Technology Division, and the 

Human Resources office. 

FEC/OIG - Semiannual Report to Congress Page 8 April 1, 2007 – September 30, 2007 
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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. 

During the reporting period of April 1, 2007 through September 30, 2007, the OIG 

had a total of ten hotline complaints at different stages – eight are pending; two are 

in progress; and three hotline complaints have been closed. 

OIG investigations: 

One investigation is currently underway. 

FEC/OIG - Semiannual Report to Congress Page 9 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

Additional OIG Activity: l

Besides conducting audits, inspections, and investigations, the OIG performs, and is 

involved in an array of additional projects and activities. As required by the 

Inspector General Act of 1978, as amended, all legislation compiled by the 

Commission’s Congressional Affairs office is reviewed by the Inspector General. 

The Inspector General also 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. The following are 

examples of the additional activities undertaken by the OIG during the past six 

months: 

The OIG conducted an audit recommendations resolution of the Audit of the 

FEC’s Employee Transit Benefit Program – OIG-06-01, released February, 

2007. The purpose of audit resolution is to ensure management’s action 

plan will address the weaknesses found during the audit. Audit resolution 

was achieved as a result of discussions between the OIG and CFO, and the 

OIG’s review of management’s action plan. In addition, as a result of the 

OIG’s review of action taken by management, the OIG concluded 

management implemented three of the twenty-five recommendations 

contained in the 2007 audit report. 

The OIG plans to conduct an audit follow-up of the remaining outstanding 

recommendations during a future semiannual reporting period. The purpose 

of the audit follow-up will be to determine whether management has 

implemented the audit recommendations, thereby enabling closure of the 

remaining outstanding recommendations. 

The OIG provided comments to the Deputy Staff Director for Management 

& Administration on the draft version of FEC Directive 63 - Delegation of 

Authority for Personnel Actions. The purpose of the directive is to establish 

FEC/OIG - Semiannual Report to Congress Page 10 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

general principles, concepts, and policies that govern human resources 

management (HRM) activities and practices within the FEC. These 

requirements constitute the framework for managing employees in an 

efficient and effective manner while ensuring adherence to Federal Human 

Resources (HR) laws, rules, and regulations. 

The OIG reviewed several versions of a draft Breach Notification Response 

Policy & Plan. The FEC developed the Breach Notification Response Plan 

(BNRP) in response to memoranda that the Office of Management and 

Budget (OMB) issued in 2006 and 2007. To mitigate the risk of harm 

(including identity theft) should a data breach occur, the OMB Memoranda 

recommends that agencies establish a core management group and policy to 

respond to the loss of certain categories of sensitive and personal 

information. The OIG provided high-level comments regarding the policy 

impact to the OIG. 

The OIG created, and released to agency employees, an informational 

brochure outlining the duties and responsibilities of the Office of Inspector 

General. Included in the brochure is information on OIG audits and 

evaluations; OIG investigations; employee protection; how to contact the 

OIG; examples of violations of laws or regulations that should be reported 

to the OIG; and how agency employees can continue to assist the OIG with 

combating fraud, waste and abuse within the FEC. An electronic version of 

the brochure is also available on the OIG website. 

FEC/OIG - Semiannual Report to Congress Page 11 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

ECIE and PCIE Activity: l

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 and confirmed by the Senate. 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 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. 

During this past reporting period, the Inspector General was elected to the 

Executive Council of the PCIE/ECIE. The Executive Council is chaired by the 

Deputy Director of OMB for Management. The Vice Chair of the PCIE, the Vice 

Chair of the ECIE, the Chairs of the PCIE committees, and one elected member 

from the ECIE comprise the Council. The Executive Council meets quarterly and 

discusses issues that affect the IG community as a whole. 

FEC/OIG - Semiannual Report to Congress Page 12 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

Audit organizations conducting audits in accordance with GAGAS are required to 

have an independent peer review every three years. A schedule detailing peer 

review responsibilities between OIGs of ECIE agencies is disseminated annually. 

The FEC OIG is conducting the peer review for the Federal Finance Housing Board 

(FHFB). The objective of the peer review is to ensure an audit organization’s 

internal quality control system adequately provides reasonable assurance that 

applicable auditing standards, policies, and procedures are met. 

The Inspector General attended the annual IG-GAO Coordination Meeting with 

Comptroller General of the United States, David Walker. Also in attendance 

representing GAO was the Chief Operating Officer, the Chief Administrative 

Officer, and the General Counsel. The Managing Directors of various GAO 

divisions were also present. Some of the topics discussed included an overview of 

GAO Yellow Book revisions, and IG and GAO coordination. 

The Inspector General, in conjunction with the Department of Agriculture’s 

Inspector General, co-hosted the Annual Inspectors General Conference – Making a 

Positive Difference in a Challenging World. The conference covered a wide range 

of topics including, Ethics, IT Security and Loss of Personally Identifiable 

Information, and Agency Head/IG Relationships. There was also a focus on 

leadership with sessions concerning Dilemma Decision Making, Leadership 

Lessons from the Civil War, and Future Direction for the PCIE/ECIE. 

Clay Johnson, Deputy Director of Management, OMB, conducted a meeting 

involving all of the Councils that he chairs. The PCIE and ECIE were invited to 

attend. Mr. Johnson discussed the importance of transparency and accountability in 

government actions and the importance in making programs work more effectively. 

The OIG attended a Congressional hearing held by a subcommittee of the 

Congressional Committee on Oversight and Government Reform. The hearing 

discussed the independence and accountability of Inspectors General. In addition, 

FEC/OIG - Semiannual Report to Congress Page 13 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

the hearing reviewed how Inspectors General in federal departments and agencies 

can maintain independence from political pressure, whether IGs have the resources 

and authority required to fulfill their duties, and how Inspectors General who fail to 

perform with integrity can be held accountable. Also discussed during the hearing 

was H.R. 928, Improving Government Accountability Act, sponsored by 

Representative Jim Cooper. 

The Inspector General, along with the Inspector General of the National Science 

Foundation, attended a meeting with staff members affiliated with Senators Coburn, 

Collins, Lieberman, and McCaskill to discuss pending legislation concerning 

Inspectors General and the affect of such legislation on the ECIE IGs. 

FEC/OIG - Semiannual Report to Congress Page 14 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

Reporting Requirements l

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----------------------------------------- 10 

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)--------------------------- 18 

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--------------------------- 5 

Section 5(a)(8) Questioned and Unsupported Costs-(Table I)---------- 16 

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

to Better Use (Table II)---------------------------------------- 17 

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 

FEC/OIG - Semiannual Report to Congress Page 15 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

TABLE I: 1 

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 

FEC/OIG - Semiannual Report to Congress Page 16 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

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 

FEC/OIG - Semiannual Report to Congress Page 17 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

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 10 29 

* Repeat column represents recommendations from the prior fiscal year 

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

Recommendations 

Report Issue 

Report Title Number Date Number Closed Open 

Audit of the FEC’s OIG-06-01 02/07 25 3 22 

Employee Transit

Benefit Program 

FEC/OIG - Semiannual Report to Congress Page 18 April 1, 2007 – September 30, 2007 
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.

 __________________________________________________________________________________ FEC/OIG – Semiannual Report to Congress Page 19 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

OIG Contacts: : 

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

received by the Office of Inspector General for the past six 

months – April 1 through September 30, 2007. These contacts were 

made through various sources such as telephone calls, personal visits 

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

Month Contacts OIG Action No Action Necessary Forwarded for 

Action 

April 202 2 196 4 

May 157 4 147 6 

June 94 1 89 4 

July 147 2 145 0 

August 128 0 128 0 

September 120 0 120 0 

TOTAL 848 9 825 14 

FEC/OIG - Semiannual Report to Congress Page 20 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

list of training, meetings, & Conferences l

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 

April 1, 2007 – September 30, 2007: 

Host / Sponsor Topic / Subject 

ECIE Monthly Meetings 

PCIE Financial Statement Audit Network Meetings 

PCIE / ECIE Awards Program Database Demonstration 

Federal Audit Executive Counsel (FAEC) Annual Conference 

Association of Government Accountants 

(AGA) 

56th Annual Professional Development 

Conference – Creating Exceptional Value in a 

Changing World 

Association of Government Accountants 

(AGA) 

Second National Internal Controls & Fraud 

Conference 

Association of Certified Fraud Examiners 

(ACFE) 

Annual Association of Certified Fraud 

Examiners Conference 

Health & Human Services / OIG Conflict of Interest and Ethics Violation 

Summit 

U.S. Postal Service / OIG TeamMate – two day training session on how 

to effectively managing the OIG’s audit and 

evaluation process using TeamMate 

U.S. Department of Agriculture / OIG 2007 Yellow Book Training 

Department of Defense TeamMate – one day refresher course 

OIG Monthly Staff Meetings and Monthly 

Meetings with Designated Counsel 

FEC All Managers’ Meeting 

FEC Administrative Liaison Group Meetings 

FEC / HR Division Performance Management Training 

FEC / SkillSoft IT Security Awareness 

FEC / SkillSoft MicroSoft Publisher 2003 

FEC / SkillSoft Employment and Labor Law 

FEC / SkillSoft Union Awareness 

FEC / SkillSoft Excellence in Internal Customer Service 

IGEL / SkillSoft Techniques for Better Time Management 

SkillPath Seminars The Indispensable Assistant 

FEC/OIG - Semiannual Report to Congress Page 21 April 1, 2007 – September 30, 2007 
__________________________________________________________________________________________________ 

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. 

FEC/OIG - Semiannual Report to Congress Page 22 April 1, 2007 – September 30, 2007