Farm r dit \ dmini!.tration 

Offi of lns p ctor G n ral 

Farm Credit Administration Office of Inspector General 

1501 Farm Credit Drive 

McLean, Virginia 22102-5090 

May 17, 2021 

The Honorable Glen R. Smith, Board Chairman and CEO 

The Honorable Jeffery S. Hall, Board Member 

Farm Credit Administration 

1501 Farm Credit Drive 

McLean, Virginia 22102 

Re: The Farm Credit Administration’s Compliance with the Payment Integrity

Information Act for Fiscal Year 2020 

Dear Chairman Smith and Board Member Hall: 

The Improper Payments Information Act of 2002 (IPIA), as amended by the Improper Payments 

Elimination and Recovery Act of 2010 (IPERA) and the Improper Payments Elimination and 

Recovery Improvement Act of 2012 (IPERIA), required federal agencies to identify and report on 

programs and activities that may be susceptible to significant improper payments in accordance 

with guidance issued by the U.S. Office of Management and Budget (OMB). On March 2, 2020, 

the Payment Integrity Information Act of 2019 (PIIA) repealed IPERA and other laws, but set forth 

similar improper payment reporting requirements, including an annual compliance review to be 

conducted by agency offices of inspectors general (OIGs). 

Because final OMB guidance implementing the PIIA was not expected to be issued until February 

2021, the Farm Credit Administration (FCA or Agency) OIG review for fiscal year (FY) 2020 was

informed by a combination of the requirements in OMB Circular A-123, Appendix C (M-18-20, 

issued June 2018), OMB Circular A-136 (issued August 2020), OMB data call instructions, OMB’s 

Payment Integrity Question and Answer Platform, and guidance issued by the Council of the 

Inspectors General on Integrity and Efficiency (CIGIE). Under this guidance, compliance is defined 

by whether an agency has: 

• Published improper payments information with the annual financial statement of the 

agency1 for the most recent FY; 

• Posted the annual financial statement and accompanying materials required under 

guidance of OMB on the agency website; 

• Conducted improper payment risk assessments for each program with annual outlays 

greater than $10,000,000 at least once in the last three years; 

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1 A report published annually in the form of an Agency Financial Report (AFR) or a Performance and Accountability 

Report (PAR) that provides financial and performance results that enable the President, Congress, and the 

American people to assess accomplishments for each fiscal year. 
• Adequately concluded whether the program is likely to make improper payments above 

or below the statutory threshold; 

• Published improper payment estimates for programs susceptible to significant improper 

payments in the accompanying materials to the annual financial statement; 

• Published corrective action plans for each program for which an estimate was above the 

statutory threshold; 

• Published improper payment reduction targets for each program for which an estimate 

was above the statutory threshold; 

• Is meeting the improper payment reduction targets (published in FY 2019) for each 

program for which an estimate was above the statutory threshold; 

• Developed a plan to meet the improper payment reduction targets; and 

• Reported an improper payment estimate of less than 10% for each program for which an 

estimate was published. 

In reporting compliance with the above criteria, CIGIE guidance advises OIGs to use a 

compliant/non-compliant approach that takes into account whether its current work, prior work,

and professional judgement lead the OIG to conclude that it has concerns regarding completeness 

or inaccuracies that would significantly alter the payment integrity information reported by the 

agency. 

The FCA OIG determined that FCA complied with PIIA requirements applicable to the Agency for

FY 2020. Additionally, the Agency’s efforts to prevent and reduce improper payments appear to

be reasonable, based on the limited review performed. 

FCA published a PAR for FY 2020 in November 2020, which included improper payments reporting 

information, and posted the PAR on the Agency’s website at https://www.fca.gov/templatefca/about/PerformanceAndAccountabilityReportFY2020.pdf. FCA last concluded risk assessments 

in January 2018 for the period ended September 30, 2017. The Agency determined that all

programs and activities were low risk and not susceptible to significant improper payments. For 

programs that are deemed not to be susceptible to significant improper payments, agencies must 

perform risk assessments at least once every three years. Therefore, FCA was not required to

conduct a risk assessment during FY 2020. Moreover, as none of the programs or activities 

assessed by FCA were determined to be susceptible to significant improper payments, the Agency 

was not required to publish improper payment estimates, publish corrective action plans, publish 

and meet annual reduction targets, or report gross improper payment rates of less than 10 

percent. 

As part of the risk assessments conducted for the period ended September 30, 2017, FCA assessed 

five programs and activities: contract payments and/or invoices; purchase cards; travel cards; 

claims and/or vouchers; and Federal employee payments, including payroll. The following table 

summarizes FCA’s compliance with improper payments reporting requirements with respect to 

those programs. 

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Table 1: FCA Compliance with FY 2020 PIIA Requirements 

Contract 

Payments Purchase 

and/or Card 

Invoices 

Travel Card 

Claims 

and/or

Vouchers 

Federal 

Employee 

Payments,

Including

Payroll 

Published improper payments 

information with the annual financial 

statement of the agency for the most 

recent fiscal year 

Posted the annua l financial statement 

and accompanying materials required 

under guidance of OMB on the agency 

website 

Conducted improper payment risk 

assessments for each program with 

annual outlays greater than $10,000,000 

at least once i n the last three yea rs 

Adequately concluded whether the 

program is li kely to make improper 

payments above or bel ow the statutory 

threshold 

Published improper payment estimates 

for programs susceptible to significant 

improper payments in the 

accompanying materials to the annual 

financial statement 

Published corrective action plans for 

each program for which an esti mate was 

above the statutory threshold 

Published improper payment reducti on 

targets for each program for whi ch an 

estimate was above the statutory 

threshold 

Is meeting the improper payment 

reduction targets (published in FY 2019) 

for each program for which an esti mate 

was above the statutory threshold 

Developed a plan to meet the i mproper 

payment reduction targets 

Compliant 

Compliant 

Compliant 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Compliant 

Compliant 

Compliant 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Compliant 

Compliant 

Compliant 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Compliant 

Compliant 

Compliant 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Compliant 

Compliant 

Compliant 

N/A 

N/A 

N/A 

N/A 

N/A 

N/A 

Reported an improper payment 

estimate of less than 10% for each 

program for which an esti mate was 

published 

N/A N/A N/A N/A N/A 

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In accordance with the PIIA and implementing guidance, this letter will be provided to the 

Committee on Homeland Security and Governmental Affairs of the U.S. Senate, the Committee on 

Oversight and Reform of the U.S. House of Representatives, OMB, and the Comptroller General. 

Should you have any questions, please do not hesitate to contact me at (703) 883-4030. 

Respectfully, 

Wendy R. Laguarda

Inspector General 

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