Farm Credit Administration

Office of Inspector General

Performance Report 

Fiscal Year 2018
Farm Credit Administration Office of Inspector General

 1501 Farm Credit Drive

 McLean, Virginia 22102-5090

 

January 23, 2019

The Honorable Dallas P. Tonsager, Board Chairman

The Honorable Jeffery S. Hall, Board Member

The Honorable Glen R. Smith, Board Member

Farm Credit Administration

1501 Farm Credit Drive

McLean, VA 22102-5090

Dear Chairman Tonsager and Board Members Hall and Smith: 

The Government Performance and Results Act of 1993 (GPRA) and GPRA Modernization Act of 

2010 encourage organizations to manage for results and hold managers accountable for 

executing programs to achieve desired outcomes. The enclosed report documents the outcomes 

or impact of the products, services, and leadership of the Office of Inspector General (OIG) 

during fiscal year 2018. 

The OIG continues striving to advance programs and operations within the Farm Credit 

Administration (FCA or Agency). The results reflect OIG’s commitment to assist in achieving the 

Agency’s mission of ensuring a safe and sound Farm Credit System that provides a dependable 

source of credit to farmers and ranchers.

We look forward to continuing to work with you to ensure FCA remains effective in its efforts to 

accomplish its mission. I welcome your comments on ways to improve OIG services that help 

you achieve your goals for FCA’s operations.

If you have any questions, please let me know. 

Respectfully,

Wendy R. Laguarda

Inspector General

Enclosure
Abbreviations

Agency Farm Credit Administration

AI&E Audits, Inspections, and Evaluations

CIGIE Council of the Inspectors General on Integrity and Efficiency

FAEC Federal Audit Executive Council

FCA Farm Credit Administration

FCS Farm Credit System

FISMA Federal Information Security Modernization Act of 2014

FY Fiscal Year

GPRA Government Performance and Results Act of 1993

IG Inspector General

IT Information Technology

OE Office of Examination

OIG Office of Inspector General

System Farm Credit System
Table of Contents 

Mission, Vision, Values, Goals.....................................................................................................................................1

Strategic Goal 1 ............................................................................................................................................................... 2 

Strategic Goal 2 ...............................................................................................................................................................3

Strategic Goal 3 ...............................................................................................................................................................4

Strategic Goal 4 ...............................................................................................................................................................5

Appendix: Audit, Inspection, and Evaluation Reports Issued in FY 2018...................................................6
1 

Mission, Vision, Values, Goals

Our Mission

The OIG’s independent eyes, ears, and voice serve to protect, inform, 

and advance Agency programs and operations.

Our Vision

Harvesting Change

Our Values

Relevant, Respectful, Trustworthy, and Objective

Our Goals

1. Detect and Deter Fraud, Waste, and Abuse

2. Investigate and Protect Against Wrongdoing

3. Promote Quality and Value

4. Advance FCA’s Future

GOAL 1

Perform risk-based 

audits, inspections, 

and evaluations

Reinforce the OIG as 

a safe zone for 

reporting fraud, 

waste, and abuse

Listen to and 

understand the 

needs, challenges, 

and interests of our 

stakeholders

GOAL 2

Guard confidentiality

Produce timely, clear, 

focused, and factual 

reports of 

investigation

Provide outreach on 

how to prevent fraud, 

waste, and abuse

GOAL 3

Create benchmarks 

for improved Agency 

decision making

Ensure the OIG and 

FCA are models for 

good government

Produce OIG 

products that are 

timely, relevant, 

reasonable, and 

helpful

GOAL 4

Recruit, retain, and 

empower a diverse 

workforce

Promote leadership, 

vision, and expertise

Leverage technology
2 

Strategic Goal 1

Detect and Deter Fraud, Waste, and Abuse

OUTCOMES AND IMPACT

The OIG performed or supervised audits, inspections, and evaluations (AI&Es) of mission-critical 

areas. Each year, we evaluate risk priorities and prepare an AI&E plan to focus on key oversight areas.

In FY 2018, we completed the following (see Appendix for details of AI&Es): 

• Information Technology Benchmarking Study

• Inspection of Physical Security in FCA’s Sacramento Field Office

• Inspection of Physical Security in FCA’s Dallas Field Office

• Inspection of FCA’s Travel Compensation and Incentives

• Audit of FCA’s Office of Secondary Market Oversight

• Inspection of Physical Security in FCA’s Bloomington Field Office

The OIG contracted with an independent public accounting firm to assess 

the Agency’s accounting and financial reporting. The Agency continued to 

receive an unmodified opinion on its FY 2017 financial statements. The OIG 

contracted with a different independent public accounting firm to assess 

the Agency's compliance with the Federal Information Security 

Modernization Act of 2014 (FISMA). 

For FY 2018, all recommendations made in our reports were accepted and 

agreed-upon by management. The OIG tracked the status of all 

recommendations in monthly reports and summarized results in its 

Semiannual Reports to Congress. During FY 2018, our reports resulted in 

17 agreed-upon actions, 28 agreed-upon actions were closed, and two 

remained open at year-end.

The OIG conducted its annual charge card risk assessment. The assessment 

was issued to the Agency, and the required letter was reported to the 

Office of Management and Budget.

The IG met quarterly with each FCA Board Member. The IG also met with 

professional staff in the Senate Committee on Agriculture, Nutrition, and 

Forestry and the House Committee on Agriculture. The OIG also 

distributed a quarterly newsletter to help Agency employees gain a better 

understanding of fraud, waste, abuse, the OIG hotline, and reporting responsibilities. The OIG briefed 

new employees and Office of Examination (OE) staff on the OIG’s role and reinforced that the OIG is 

a safe zone for reporting fraud, waste, and abuse. 

The OIG also identified management’s top challenges in the Agency’s annual Performance and 

Accountability Report, which helps the OIG and the Agency align priorities to key risk areas.

Goal 1

Performance 

Measures 

 Perform risk-based 

audits, inspections, 

and evaluations

 Reinforce the OIG as 

a safe zone for 

reporting fraud, 

waste, and abuse

 Listen to and 

understand the 

needs, challenges, 

and interests of our 

stakeholders
3 

Strategic Goal 2

Investigate and Protect Against Wrongdoing

OUTCOMES AND IMPACT

Tips and complaints about fraud, waste, and abuse relating to FCA programs and operations can be 

reported to the OIG through various channels that allow the OIG to guard complainants’ 

confidentiality. Individuals may contact the OIG by phone, by fax, and in writing. The OIG hotline is 

also available 24/7 to receive tips and complaints and a secure email account that is maintained 

independently of Agency servers.

This reporting period we processed 33 complaints, including 12 borrower 

rights-type complaints that we referred to the Office of Congressional & 

Public Affairs, the Office of General Counsel, or OE. Each complaint 

submitted to the OIG received prompt attention or was referred to the 

appropriate office within two business days.

OIG conducted two preliminary investigations and one formal

investigation during FY 2018. Each month, the OIG tracked the status of 

investigations internally to ensure timely progress. The OIG published 

closing memoranda summarizing investigation reports issued to the 

Agency on the OIG website within 10 business days. The OIG coordinated 

with law enforcement when warranted, reporting to the U.S. Department 

of Justice within 10 business days of developing evidence of potential 

criminal violations. 

We protected employee confidentiality throughout the investigative 

process in a manner consistent with law and policy. We provided the 

appropriate warnings and notified employees of their rights and 

responsibilities in all interviews. The OIG provided all subjects and

witnesses who provided a signed sworn statement with an opportunity to 

review the statement to ensure its accuracy and fairness.

FCA employees are more likely to bring fraud, waste, abuse, and 

mismanagement to the attention of the OIG when they are trained to 

identify them and are aware of their responsibility to report suspected 

problems. The OIG participated in the Agency’s new employee training 

process, informing new hires about the role of the OIG, the OIG hotline, 

and their responsibility to report fraud, waste, and abuse relating to 

Agency programs and operations. The OIG created hotline posters to educate employees on 

reporting fraud, waste, abuse, and mismanagement. The OIG also prepared and distributed a 

quarterly newsletter to further educate Agency personnel on definitions and examples of fraud, 

waste, and abuse, and to provide information on how to reach the OIG. During FY 2018, we updated 

the OIG whistleblower page to more clearly explain whistleblower protections.

Goal 2

Performance 

Measures 

 Guard 

confidentiality

 Produce timely, 

clear, focused, and 

factual reports of 

investigation

 Provide outreach on 

how to prevent 

fraud, waste, and 

abuse

 
4 

Strategic Goal 3

Promote Quality and Value 

OUTCOMES AND IMPACT

The OIG completed an information technology (IT) benchmarking study in September 2018. This 

evaluation compared FCA’s IT budget and use of other IT contractual services to the other federal 

financial regulators. During the reporting period, the OIG also initiated a benchmarking study on 

examination staff with other federal financial regulators, and this report will be finalized in FY 2019.

The OIG conducted quarterly surveys of FCS institutions that solicited feedback regarding FCA’s 

examination process. The OIG issued four survey reports for the 

reporting period, which included quarterly reports and an annual 

summary with the fourth quarter report.

To test and validate quality controls, OIGs participate in peer reviews. 

During FY 2018, the FCA OIG led the external peer review of the ExportImport Bank of the United States OIG’s inspection and evaluation

function. Peer reviews of FCA OIG’s audit and inspection and evaluation 

functions are scheduled to begin in FY 2019.

The OIG evaluated our internal controls, assessed risks in each area, and 

prepared a review plan. During FY 2018, our office completed an internal 

control review for workforce development and outreach.

 

The OIG tracks and comments as appropriate on proposed legislation 

and regulations and informs the FCA Board and management about the 

status of new or pending legislation or regulations that have an impact 

on the Agency or on the OIG. The IG is also a member of the CIGIE 

Legislation Committee. These activities help our office stay apprised of 

changing authorities and requirements as well as oversight trends across 

the IG community.

The OIG continued to timely report on completed work and 

achievements through its Semiannual Reports to Congress, which are 

posted on the OIG’s public website. The OIG issued each Semiannual 

Report within 30 days of the end of the reporting period. The OIG 

posted reports on its public website within three days of issuance, as 

required by statute, and on the CIGIE website for all OIGs called 

Oversight.gov. With respect to certain reports containing sensitive information regarding FCA 

vulnerabilities, summary documents were posted in lieu of the full reports to avoid exposing the 

Agency or its employees to additional risk.

Goal 3

Performance 

Measures 

 Create benchmarks 

for improved 

Agency decision 

making

 Ensure the OIG and 

FCA are models for 

good government

 Produce OIG 

products that are 

timely, relevant, 

reasonable, and 

helpful
5 

Strategic Goal 4

Advance FCA’s Future

OUTCOMES AND IMPACT

The OIG invests in its people to achieve effective oversight and support our stakeholders. To meet 

standards and stay abreast of oversight best practices, auditors completed training and participated 

in professional organizations. Senior auditors completed training requirements prescribed in 

Government Auditing Standards. The IG and the OIG investigator also completed training 

requirements prescribed by CIGIE. In addition, staff maintained professional certifications, including: 

Certified Public Accountant, Certified Fraud Examiner, and Certified Information Systems Auditor.

The IG and staff are actively involved in the Council of the Inspectors 

General on Integrity and Efficiency (CIGIE). The OIG participates in CIGIE’s 

Legislation, Audit, and Inspection and Evaluation committees. The IG and 

staff also participated in the following CIGIE groups:

• Inspection and Evaluation Roundtable 

• Small and Unique OIGs Workgroup

• Council of Counsels to the Inspectors General 

• Federal Audit Executive Council (FAEC)

• FAEC Information Technology Committee

• Inspection and Evaluation Peer Review Implementation Team

• CIGIE Commemoration Working Group

A Senior Auditor served as an adjunct instructor for CIGIE’s training 

institute. The IG served on a workgroup that developed a report on the 

top management and performance challenges facing multiple federal 

agencies. Top challenges were categorized to identify common themes 

and key areas of concern.

The OIG leverages technology to maintain documents and records, ensure 

communications are timely, and track ongoing activities. The OIG tracked 

the status of recommendations, timeframes for work products, and closure 

documentation in its audit follow-up database.

This reporting period, our website was updated to improve the 

organization and quality of our communication with the public.

Goal 4

Performance 

Measures 

 Recruit, retain, and 

empower a diverse 

workforce

 Promote leadership, 

vision, and expertise

 Leverage 

technology

 
6 

Appendix: 

Audit, Inspection, and Evaluation Reports Issued in FY 2018

Report Name Date Issued Mandate Months to 

Completion

Agreed-Upon 

Actions in Report

AUDITS

FCA’s Office of Secondary Market 

Oversight March 20, 2018 OIG Initiated 10 5 

Audit of FCA’s Financial Statements 

for FY 2017 November 16, 2017

Legislatively 

Mandated Annual 

Audit

9 No Action Items

Federal Information Security 

Modernization Act Evaluation for FY 

2017

October 27, 2017

Legislatively 

Mandated Annual 

Evaluation

5.5 4 

INSPECTIONS

Physical Security in FCA’s 

Sacramento Field Office June 19, 2018 OIG Initiated 2 3 

Physical Security in FCA’s Dallas Field 

Office April 19, 2018 OIG Initiated 2.5 No Action Items

FCA’s Travel Compensation and 

Incentives March 30, 2018 OIG Initiated 9.5 No Action Items

Physical Security in FCA’s 

Bloomington Field Office March 19, 2018 OIG Initiated 5 5 

EVALUATIONS

Information Technology 

Benchmarking Study September 6, 2018 OIG Initiated 9 No Action Items