FEDERAL MARITIME COMMISSION 

800 North Capitol Street, N.W. 

Washington, DC 20573 

Inspector General 

 May 13, 2016 

The Honorable Ron Johnson, Chairman 

Committee on Homeland Security and 

 Governmental Affairs 

United States Senate 

328 Hart Senate Office Building 

Washington, DC 20510 

The Honorable Thomas R. Carper, Ranking

 Member 

Committee on Homeland Security and 

 Governmental Affairs 

United States Senate 

513 Hart Senate Office Building 

Washington, DC 20510 

The Honorable David Mader, Controller 

Office of Management and Budget 

725 17th Street, NW 

Washington, DC 20503 

The Honorable Jason Chaffetz, Chairman 

Committee on Oversight and Government Reform 

United States House of Representatives 

2236 Rayburn House Office Building 

Washington, DC 20515 

The Honorable Elijah E. Cummings, Ranking Member 

Committee on Oversight and Government Reform 

United States House of Representatives 

2230 Rayburn House Office Building 

Washington, DC 20515 

The Honorable Gene L. Dodaro 

Comptroller General of the United States 

U.S. Government Accountability Office 

441 G Street, NW 

Washington, DC 20548 

SUBJECT: Improper Payments Compliance Report
	

This report communicates the results of the Federal Maritime Commission (FMC) Office of 

Inspector General’s (OIG) annual review of the FMC’s compliance with reporting and 

performance requirements regarding improper payments. The OIG concluded the FMC is in 

compliance and has met the requirements that are applicable to the agency for fiscal year (FY) 

2015. 

The OIG completed the annual review based on guidance contained in Office of Management and 

Budget (OMB) Circular No. A-123, Appendix C, Requirements for Effective Estimation and 

Remediation of Improper Payments (as modified by OMB M-15-02, October 20, 2014.) Appendix 

C implements requirements from the following: (1) the Improper Payments Information Act of 

2002 (IPIA), as amended; (2) the Improper Payments Elimination and Recovery Act of 2010 

(IPERA); (3) the Improper Payments Elimination and Recovery Improvement Act of 2012 

(IPERIA); and (4) Executive Order 13520 - Reducing Improper Payments, November 20, 2009. 
 

 

 

 

 

The purpose of IPERA and the related requirements are to improve the Federal government’s 

efforts to reduce and recover improper payments. An improper payment is any payment that should 

not have been made or that was made in an incorrect amount. Incorrect amounts can be 

overpayments or underpayments. An improper payment also includes any payment that was made 

to an ineligible recipient or for an ineligible good or service, or payments for goods or services not 

received (except for such payments authorized by law). In addition, when an agency's review is 

unable to discern whether a payment was proper as a result of insufficient or lack of 

documentation, this payment must also be considered an improper payment. 

Each agency inspector general is required to review improper payment reporting in their agency’s 

annual performance and accountability report (PAR) or agency financial report (AFR) to 

determine if the agency is in compliance with the applicable requirements. OMB M-15-02 lists 

six requirements an agency must meet, where applicable, to be in compliance with the improper 

payments requirements. In brief, these six requirements are as follows: (1) publish a PAR or AFR; 

(2) conduct a risk assessment; (3) publish improper payment estimates; (4) publish corrective 

action plans; (5) publish/meet reduction goals; and (6) achieve an improper payment rate of less 

than 10%. 

The OIG reviewed the agency’s disclosures contained in the FMC’s FY 2015 PAR posted on the 

agency’s website for compliance with IPERA and related requirements. Specifically, the FMC 

assessment concluded that the agency has not identified any program that in and of itself 

constitutes a high-risk for improper payments. As a result, the FMC assessed all of its payments 

to be low-risk for improper payments. The agency reported a zero improper payment rate for FY 

2015 and forecasted the same rate for outlying years. The agency was not required to publish an 

improper payment corrective action plan, reduction targets or conduct a risk assessment for FY 

2015. 

As a result of the OIG’s annual review, the OIG identified an improvement to the agency’s process 

for conducting a risk assessment every three years, and this will be communicated separately to 

agency management. 

The OIG is required to report these results to the FMC Commission; the Committee on Homeland 

Security and Governmental Affairs of the U.S. Senate; the Committee on Oversight and 

Governmental Reform of the U.S. House of Representatives; the Comptroller General; and the 

Controller of OMB. 

If you have any questions or comments, please contact me on (202) 523-5863 or 

jhatfield@fmc.gov. Thank you. 

 Sincerely,

 Jon Hatfield 

Inspector General 

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