FEDERAL MARITIME COMMISSION 

800 North Capitol Street, N.W. 

Washington, DC 20573 

Inspector General 

March 31, 2017 

The Honorable Ron Johnson, Chairman 

Committee on Homeland Security and 

Governmental Affairs 

United States Senate 

340 Hart Senate Office Building 

Washington, DC 20510 

The Honorable Claire C. McCaskill, Ranking 

Member 

Committee on Homeland Security and 

Governmental Affairs 

United States Senate 

442 Hart Senate Office Building 

Washington, DC 20510 

The Honorable Mick Mulvaney, Director 

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 

2157 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 

2471 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 is required by the Improper Payments Elimination 

and Recovery Act of 2010 (IPERA) to prepare and submit this annual compliance report within 180 days 

after the agency’s Performance and Accountability Report is published. 

For fiscal year (FY) 2016, the OIG concluded the FMC complied and met the requirements that 

are applicable to the agency for improper payment reporting. According to Office of Management and 

Budget (OMB) guidance, compliance with IPERA means that the agency met the following six 

requirements, as appropriate: 

1. Published a Performance and Accountability Report (PAR) or Annual Financial Report (AFR) 

for the most recent fiscal year and posted that report and any accompanying materials required 

by OMB on the agency website. 

FMC complied with this requirement for FY 2016. 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2. Conducted a program-specific risk assessment for each program or activity that conforms with 

title 31, United States Code, section 3321. 

FMC was not required to complete a risk assessment for FY 2016; for the FMC, a risk assessment is 

required every three years. The FMC will be required to complete a risk assessment for FY 2017 

reporting. 

3. Published improper payment estimates for all programs and activities identified as susceptible 

to significant improper payments under its risk assessment. 

Not applicable to FMC for FY 2016; FMC assessed all of its payments to be low-risk for improper 

payments. 

4. Published programmatic corrective action plans in the PAR or AFR. 

Not applicable to FMC for FY 2016. 

5. Published and met annual reduction targets for each program assessed to be at risk and 

measured for improper payments. 

Not applicable to FMC for FY 2016. 

6. Reported a gross improper payment rate of less than 10 percent for each program and activity 

for which an improper payment estimate was obtained and published in the PAR. 

FMC complied with this requirement for FY 2016. 

The OIG completed this annual review based on guidance contained in 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 are overpayments or 

underpayments that are made to eligible recipients. 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. 

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

annual Performance and Accountability Report (PAR) or Annual Financial Report to determine if the 

agency is in compliance with IPERA. The OIG reviewed the agency’s disclosures contained in the FMC’s 

FY 2016 PAR posted on the agency’s website for compliance with IPERA and related requirements. 

Specifically, the FMC’s 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 2016 

and forecasted the same rate for outlying years. The agency is not required to publish improper payment 

corrective action plans or reduction targets. 

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

Security and Governmental Affairs of the Senate; the Committee on Oversight and Government Reform 

of the 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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