U.S. ELECTION ASSISTANCE 

COMMISSION 

OFFICE OF INSPECTOR GENERAL

FINAL REPORT: 

ADMINISTRATION OF PAYMENTS 

RECEIVED UNDER THE HELP 

AMERICA VOTE ACT BY THE STATE 

OF WASHINGTON SECRETARY OF 

STATE 

APRIL 30, 2003 THROUGH DECEMBER 31, 2007

Report No. 

E-HP-WA-05-08 

NOVEMBER 2008
U.S. ELECTION ASSISTANCE COMMISSION

OFFICE OF INSPECTOR GENERAL

1225 New York Ave. NW - Suite 1100 

Washington, DC 20005

November 17, 2008 

Memorandum 

To: Thomas Wilkey 

 Executive Director 

From: Curtis W. Crider 

 Inspector General 

Subject: Final Audit Report - Administration of Payments Received Under the Help America 

Vote Act by the State of Washington Secretary of State 

 (Assignment Number E-HP-WA-05-08) 

 We contracted with the independent certified public accounting firm of Clifton Gunderson 

LLP (Clifton Gunderson) to audit the administration of payments received under the Help America 

Vote Act (HAVA) by the State of Washington Secretary of State (SOS). The contract required that 

the audit be done in accordance with U.S. generally accepted government auditing standards. 

Clifton Gunderson is responsible for the attached auditor’s report and the conclusions expressed 

therein. 

 In its audit of the SOS, Clifton Gunderson concluded that the SOS accounted for and 

expended HAVA funds in accordance with the HAVA requirements and complied with the 

financial management requirements established by the U.S. Election Assistance Commission. The 

SOS also complied with section 251 requirements. However, we did not include a determination of 

whether the SOS and its subgrantees met the requirements for maintenance of a base level of state 

outlays because the Commission is reviewing its guidance on the applicability of the maintenance 

of a base level of state outlays to the SOS’s subgrantees

 Since the report does not contain any recommendations, we are not requesting a response. 

 

 The legislation, as amended, creating the Office of Inspector General (5 U.S.C. § App.3) 

requires semiannual reporting to Congress on all audit reports issued, actions taken to implement 

audit recommendations, and recommendations that have not been implemented. Therefore, this 

report will be included in our next semiannual report to Congress. 

 If you have any questions regarding this report, please call me at (202) 566-3125. 
PERFORMANCE AUDIT REPORT 

ADMINISTRATION OF PAYMENTS RECEIVED 

UNDER THE HELP AMERICA VOTE ACT 

BY THE 

STATE OF WASHINGTON 

April 30, 2003 Through December 31, 2007 

UNITED STATES ELECTION 

ASSISTANCE COMMISSION 
TABLE OF CONTENTS

PAGE 

EXECUTIVE SUMMARY..............................................................................................................1

BACKGROUND............................................................................................................................2 

AUDIT OBJECTIVES ...................................................................................................................2 

SCOPE AND METHODOLOGY...................................................................................................3 

AUDIT RESULTS .........................................................................................................................3 

APPENDICES 

Appendix A: Audit Methodology ...............................................................................................5 
1 

11710 Beltsville Drive, Suite 300 

Calverton, MD 20705-3106 

tel: 301-931-2050 

fax: 301-931-1710 

www.cliftoncpa.com Offices in 17 states and Washington, DC

U.S. Election Assistance Commission 

Performance Audit of the Administration of Payments Received Under the 

Help America Vote Act by the State of Washington 

EXECUTIVE SUMMARY

Clifton Gunderson LLP was engaged by the U.S. Election Assistance Commission (EAC or the 

Commission) Office of Inspector General to conduct a performance audit of the Washington 

Office of the Secretary of State (SOS) for the period April 30, 2003 through December 31, 2007 

to determine whether the SOS used payments authorized by Sections 101, 102, and 251 of the 

Help America Vote Act of 2002 (HAVA or the Act) in accordance with HAVA and applicable 

requirements; accurately and properly accounted for property purchased with HAVA payments 

and for program income, and met HAVA requirements for Section 251 funds for an election fund 

and for a matching contribution. We did not include a determination of whether the SOS and its 

subgrantees met the requirements for maintenance of a base level of state outlays because the 

Commission is reviewing its guidance on the applicability of the maintenance of a base level of 

state outlays to the SOS’s subgrantees. 

In addition, the Commission requires states to comply with certain financial management 

requirements, specifically: 

• Comply with the Uniform Administrative Requirements For Grants And Cooperative 

Agreements With State And Local Governments (also known as the “Common Rule”) as 

published in the Code of Federal Regulations 41 CFR 105-71. 

• Expend payments in accordance with cost principles for establishing the allowance or 

disallowance of certain items of cost for federal participation issued by the Office of 

Management and Budget (OMB) in Circular A-87. 

• Submit detailed annual financial reports on the use of Title I and Title II payments. 

We conducted this performance audit in accordance with Generally Accepted Government 

Auditing Standards. Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objectives. We believe that the evidence obtained provides a reasonable 

basis for our findings and conclusions based on the audit objectives. Because of inherent 

limitations, a study and evaluation made for the limited purposes of our review would not 

necessarily disclose all weaknesses in administering HAVA payments. 

Our audit concluded that the SOS accounted for and expended HAVA funds in accordance with 

the requirements mentioned above for the period from April 30, 2003 through December 31, 

2007, except for the determination of whether the SOS and its subgrantees met the 

requirements for maintenance of a base level of state outlays which were specifically omitted 

from our scope of audit work as explained above. 
2 

BACKGROUND

The Help America Vote Act of 2002 created the Commission to assist states and insular areas 

with the improvement of the administration of Federal elections and to provide funds to states to 

help implement these improvements. HAVA authorizes payments to states under Titles I and II, 

as follows: 

• Title I, Section 101 payments are for activities such as complying with Title III of HAVA for 

uniform and nondiscriminatory election technology and administration requirements, 

improving the administration of elections for Federal office, educating voters, training 

election officials and poll workers, and developing a state plan for requirements 

payments. 

• Title I, Section 102 payments are available only for the replacement of punch card and 

lever action voting systems. 

• Title II, Section 251 requirements payments are for complying with Title III requirements 

for voting system equipment; and for addressing provisional voting, voting information, 

statewide voter registration lists, and voters who register by mail. 

Title II also requires that states must: 

• Have appropriated funds “equal to 5 percent of the total amount to be spent for such 

activities [activities for which requirements payments are made].” [Section 253(b)(5)]. 

• “Maintain the expenditures of the State for activities funded by the [requirements] payment 

at a level that is not less than the level of such expenditures maintained by the State for 

the fiscal year ending prior to November 2000.” [Section 254 (a)(7)]. 

• Establish an election fund for amounts appropriated by the state “for carrying out the 

activities for which the requirements payment is made,” for the Federal requirements 

payments received, for “such other amounts as may be appropriated under law,” and for 

“interest earned on deposits of the fund.” [Section 254 )(b)(1)]. 

AUDIT OBJECTIVES

The objectives of our audit were to determine whether the State of Washington, Office of the 

Secretary of State: 

1. Used payments authorized by Sections 101, 102, and 251 of the Help America Vote Act 

(HAVA) in accordance with HAVA and applicable requirements; 

2. Accurately and properly accounted for property purchased with HAVA payments and for 

program income; 

3. Met HAVA requirements for Section 251 funds for an election fund and for a matching 

contribution. We did not determine whether the SOS met the requirement for 

maintenance of a base level of state outlays because the Commission is reviewing its 

guidance on the applicability of the maintenance of a base level of state outlays to 

subgrantees of the SOS. 
3 

In addition, to account for HAVA payments, the Act requires states to maintain records that are 

consistent with sound accounting principles that fully disclose the amount and disposition of the 

payments, that identify the project costs financed with the payments and other sources, and that 

will facilitate an effective audit. The Commission requires states receiving HAVA funds to 

comply with certain financial management requirements, specifically: 

1. Comply with the Uniform Administrative Requirements For Grants And Cooperative 

Agreements With State and Local Governments (also known as the “Common Rule”) as 

published in the Code of Federal Regulations at 41 CFR 105-71. 

2. Expend payments in accordance with cost principles for establishing the allowance or 

disallowance of certain items of cost for federal participation issued by the Office of 

Management and Budget (OMB) in Circular A-87. 

3. Submit detailed annual financial reports on the use of Title I and Title II payments.1

SCOPE AND METHODOLOGY

We audited the HAVA funds received and disbursed by the SOS from April 30, 2003 through 

December 31, 2007. 

Funds received and disbursed from April 30, 2003 (program initiation date) to December 31, 

2007 (56-month period) are shown below: 

 FUNDS RECEIVED 

TYPE OF 

PAYMENT

EAC 

PAYMENT 

 STATE 

MATCH 

INTEREST 

EARNED 

TOTAL 

AVAILABLE

FUNDS 

DISBURSED 

DATA 

AS OF

 

101 $ 6,098,449 $ 0 $ 259,047 $ 6,357,496 $ 6,357,496 12/31/2007 

102 6,799,430 0 453,187 7,252,617 6,321,236 12/31/2007 

251 47,195,971 2,485,877 4,231,120 53,912,968 29,795,455 12/31/2007 

 

 $60,093,850 $2,485,877 $4,943,354 $67,523,081 $42,474,187 12/31/2007 

Our audit methodology is set forth in the Appendix. 

AUDIT RESULTS

We conducted this performance audit in accordance with Generally Accepted Government 

Auditing Standards. Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions 

based on our audit objectives. We believe that the evidence obtained provides a reasonable

 

1 EAC requires states to submit annual reports on the expenditure of HAVA Sections 101, 102, and 251 funds. For 

Sections 101 and 102, reports are due on February 28 for the activities of the previous calendar year. For Section 

251, reports are due by March 30 for the activities of the previous fiscal year ending on September 30. 
4 

basis for our findings and conclusions based on the audit objectives. Because of inherent 

limitations, a study and evaluation made for the limited purposes of our review would not 

necessarily disclose all weaknesses in administering HAVA payments. 

Except for the determination of whether the SOS and its subgrantees met the requirements for 

maintenance of a base level of state outlays which were specifically omitted from our scope of 

audit work as explained above, we concluded that the SOS accounted for and expended HAVA 

funds in accordance with the requirements mentioned above. This includes compliance with 

section 251 requirements for an election fund. 

**************************************** 

We provided a draft of our report to the appropriate individuals of the State of Washington Office 

of the Secretary of State, and the United States Election Assistance Commission. We 

considered any comments received prior to finalizing this report. 

CG performed its work between April 14 and May 13, 2008. 

Calverton, Maryland 

November 6, 2008 
5 

Appendix A 

AUDIT METHODOLOGY 

Our audit methodology included: 

• Assessing audit risk and significance within the context of the audit objectives. 

• Obtaining an understanding of internal control that is significant to the administration of the 

HAVA funds. 

• Understanding relevant information systems controls as applicable. 

• Identifying sources of evidence and the amount and type of evidence required. 

• Determining whether other auditors have conducted, or are conducting, audits of the 

program that could be relevant to the audit objectives. 

To implement our audit methodology, below are some of the audit procedures we performed: 

• Interviewed appropriate SOS employees about the organization and operations of the HAVA 

program. 

• Reviewed prior single audit report and other reviews related to the state’s financial 

management systems and the HAVA program for the last 2 years. 

• Reviewed policies, procedures and regulations for the SOS’s management and accounting 

systems as they relate to the administration of HAVA programs. 

• Analyzed the inventory lists of equipment purchased with HAVA funds. 

• Tested major purchases and supporting documentation. 

• Tested randomly sampled payments made with the HAVA funds. 

• Verified support for reimbursements to local governments (counties, cities, and 

municipalities). 

• Reviewed certain state laws that impacted the election fund. 

• Examined appropriations and expenditure reports for state funds used to maintain the level 

of expenses for elections at least equal to the amount expended in fiscal year 2000 and to 

meet the five percent matching requirement for section 251 requirements payments. 

• Evaluated compliance with the requirements for accumulating financial information reported 

to the Commission on the Financial Status Reports, Form SF-269, accounting for property, 

purchasing HAVA related goods and services, and accounting for salaries. 
6 

• Verified the establishment and maintenance of an election fund. 

• Conducted site visits of selected counties to perform the following: 

 Observe equipment purchased with HAVA funds for proper accounting and 

safeguarding 

 Test disbursement of HAVA funds for allowability and compliance 

 Test cash receipts from SOS to ensure proper cash management 

 Test procurement of voting equipment for competitive bid process 

 Ensure compliance with HAVA Act. 
OIG’s Mission 

The OIG audit mission is to provide timely, high-quality 

professional products and services that are useful to OIG’s clients. 

OIG seeks to provide value through its work, which is designed to 

enhance the economy, efficiency, and effectiveness in EAC 

operations so they work better and cost less in the context of 

today's declining resources. OIG also seeks to detect and prevent 

fraud, waste, abuse, and mismanagement in these programs and 

operations. Products and services include traditional financial and 

performance audits, contract and grant audits, information systems 

audits, and evaluations. 

Obtaining 

Copies of 

OIG Reports 

Copies of OIG reports can be requested by e-mail. 

(eacoig@eac.gov). 

Mail orders should be sent to: 

U.S. Election Assistance Commission 

Office of Inspector General 

1225 New York Ave. NW - Suite 1100 

Washington, DC 20005 

To order by phone: Voice: (202) 566-3100 

 Fax: (202) 566-0957 

To Report Fraud, 

Waste and Abuse 

Involving the U.S. 

Election Assistance 

By Mail: U.S. Election Assistance Commission 

 Office of Inspector General 

 1225 New York Ave. NW - Suite 1100 

 Washington, DC 20005

Commission or Help 

America Vote Act 

Funds

E-mail: eacoig@eac.gov

OIG Hotline: 866-552-0004 (toll free) 

FAX: 202-566-0957