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corpora

5. Corporate management cont

The FDIC uses several means to maintain 

comprehensive internal controls, ensure the 

overall effectiveness and efficiency of operations 

and otherwise comply as necessary with the following 

federal standards, among others:

★ Chief Financial Officers’ Act (CFO Act)

★ Federal Managers’ Financial Integrity Act (FMFIA)

★ Federal Financial Management Improvement 

Act (FFMIA)

★ Government Performance and Results Act (GPRA)

★ Federal Information Security Management Act (FISMA)

★ OMB Circular A-123

★ GAO’s Standards for Internal Control in the 

Federal Government

As a foundation for these efforts, the Corporate 

Management Control Branch in DOF [formerly the Office 

of Enterprise Risk Management (OERM)] traditionally 

has overseen a corporate-wide program of relevant 

activities by establishing policies and coordinating on 

an ongoing basis with parallel management control 

units in each Division and Office in the FDIC. Broadly 

speaking, a coordinated effort has been made to 

ensure that operational risks have been identified, with 

corresponding control needs being incorporated into 

day-to-day operations. The program also imposes the 

need for comprehensive procedures to be documented, 

employees to be thoroughly trained and supervisors 

to be held accountable for performance and results. 

Compliance monitoring is carried out through periodic 

management reviews and by the distribution of various 

activity reports to all levels of management. Conscientious 

attention is also paid to the implementation of audit 

recommendations made by the FDIC Office of the 

Inspector General, the GAO, the Treasury Department’s 

Special Inspector General for the TARP program and 

other providers of external/audit scrutiny. The FDIC 

has received unqualified (clean) opinions on its financial 

statement audits for twenty consecutive years, and these 

and other positive results are reflective of the effectiveness 

of the overall management control program.

Significantly, since the beginning of the financial crisis, 

the FDIC has expanded the range of issues receiving 

close management scrutiny to encompass crisis-related 

challenges. Several Program Management Organizations 

(PMOs) were created to oversee such issues as shared-loss 

agreements, legacy loans, systemic resolution authority, 

the Temporary Liquidity Guarantee Program, contract 

management oversight, and resource management. For 

each area, key issues and risks were identified, action plans 

and performance metrics were developed as necessary, and 

the Chairman was briefed at least monthly. In many cases, 

enhancements in operating procedures and automated 

systems of support were made as a direct result of this 

heightened management attention. Particular attention 

also was given to the training needs of the FDIC’s 

expanded staff, to include training in supervisory skills, 

to help ensure the continuation of effective operations 

and results. 

Similar plans for 2012 and beyond have been developed 

to ensure a smooth transition of operations as we move 

toward a post-crisis operating environment. Among other 

things, program evaluation activities in the coming year 

will focus not only on new responsibilities associated 
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124

with the Dodd-Frank legislation and other internal 

organizational changes, but on the closing of temporary 

satellite offices and the downsizing of staffing in general. 

Continued emphasis and management scrutiny also will 

be applied to contracting oversight, the accuracy and 

integrity of transactions, and systems development efforts 

in general. 

Managment R

As required under amended Section 5 of the Inspector 

General Act of 1978, the FDIC must report information 

on final action taken by management on certain audit 

reports. The tables on the following pages provide 

information on final action taken by management on 

audit reports for the federal fiscal year period October 1, 

2010, through September 30, 2011.

Table 1: Management Report on Final Action on Audits with Disallowed Costs for Fiscal Year 2

Dolars

Audit Re

Number

Reports Disa

A. Management decisions – final action not taken at beginning of period 2 $25,148

B. Management decisions made during the period 4 $42,801

C. Total reports pending final action during the period (A and B) 6 $67,949

D.

Final action taken during the period:

1. Recoveries: 

(a) Collections & offsets 5 $37,605

(b) Other 0 $0

2. Write-offs 3 $3,987

3. Total of 1(a), 1(b), & 2 51 $41,592

E. Audit reports needing final action at the end of the period 2 $31,4752

1 Three reports have both collections and write-offs, thus the total of 1(a), 1(b), and 2 is five.

2 Amount collected in D3 included excess recoveries of $2.6 million not reflected in line E. 
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Table 2: Management Report on Final Action on Audits with Recommendations to Put Fund

to Better Use for Fiscal Year 20

Dolars

Audit Re

Number

Reports Funds Put T

A. Management decisions – final action not taken at beginning of period 0 $0 

B. Management decisions made during the period 1 $2,509 

C. Total reports pending final action during the period (A and B) 1 $2,509 

D.

Final action taken during the period:

1. Value of recommendations implemented (completed) 1 $43

2. Value of recommendations that management concluded should not 

or could not be implemented or completed

1 $2,466

3. Total of 1 and 2 13 $2,509

E. Audit reports needing final action at the end of the period 0 $0

Table 3: Audit Reports Without Final Actions But With Management Decisions Over One Y

for Fiscal Year 2011 Management Action in Proc

Report No. 

Issue Date OIG Audit Fi

Disal

Co

AUD-11-001

11/30/2010

KPMG recommends that the 

FDIC should complete the design 

and implementation of an agencywide continuous monitoring 

program that addresses continuous 

monitoring strategies for FDIC 

information systems.

During 2011, the FDIC completed the design 

of the agency-wide continuous monitoring 

program and made significant progress in 

implementing that program. The Office of 

Inspector General’s Federal Information 

Security Management Act (FISMA) results 

confirmed that, “the FDIC made meaningful 

progress in developing an agency-wide 

continuous monitoring program.” 

In addition, the OIG 2011 FISMA report 

further stated that the OIG was not issuing 

any new recommendations in the area 

of continuous monitoring management 

because, “the FDIC was working to fully 

implement a multi-year effort to address a 

recommendation in our prior-year security 

evaluation report required by FISMA.” 

The OIG will re-evaluate progress on the 

implementation of this program during the 

2012 FISMA evaluation.

Expected completion date: December 2012

$0 

3 One report had both implemented and unimplemented values.