Inspectors General: Reporting on Independence, Effectiveness, and Expertise
Published: 2011-09-21T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) required GAO to report on the relative independence, effectiveness, and expertise of the inspectors general (IG) established by the IG Act of 1978, as amended (IG Act), including IGs appointed by the President with Senate confirmation and those appointed by their agency heads in designated federal entities (DFE). GAO was also required to report on the effect that provisions in the Dodd-Frank Act have on IG independence. The objectives of this report are to provide information as reported by the IGs on (1) the implementation of provisions intended to enhance their independence in the IG Reform Act of 2008 (Reform Act), the IG Act, and the Dodd-Frank Act; (2) their measures of effectiveness, including oversight of American Recovery and Reinvestment Act of 2009 (Recovery Act) funds; and (3) their expertise and qualifications in areas specified by the IG Act. GAO relied primarily on responses to its survey received from 62 IGs established by the IG Act. GAO also obtained information from the President's fiscal year 2011 budget, the IGs' annual report to the President for fiscal year 2009, and the IGs' semiannual reports to the Congress. GAO is not making any recommendations in this report. In comments on a draft of this report, the Council of the Inspectors General on Integrity and Efficiency (IG Council) stated the report contributes to a greater understanding of the work of the IGs in providing oversight to a wide range of government programs..
section_title: What GAO Found
paragraphs: Information from the 62 IGs in offices established by the IG Act and GAO's analysis showed that the IGs had (1) taken actions to implement statutory provisions intended to enhance their independence; (2) reported billions of dollars in potential savings and other measures of effectiveness, including actions taken to help prevent fraud in the distribution of Recovery Act funds; and (3) a range of expertise and qualifications in the areas specified by the IG Act. With respect to independence, the IGs reported that (1) statutory provisions regarding IG compensation have been implemented where applicable, thereby maintaining the independence of their work and enhancing their relative stature within their agencies; (2) they had access to independent legal counsel who reports to an IG instead of an agency management official; (3) only one IG used a statutory provision for IGs to report particularly flagrant problems through the agency head to the Congress in 7 days because issues are generally resolved before the report is needed; and (4) of the affected 26 DFE IGs, 14 responded that their independence was enhanced by the Dodd-Frank Act provision that changed the designation of agency head from the chair to the entire board or commission, and 20 responded that their independence was enhanced by the provision requiring a two-thirds majority vote for IG removal. Also, the IGs' budgets were not always identified separately in the President's fiscal year 2011 budget submission as required by the Reform Act provision intended to enhance the IGs' budget independence through transparent reporting. The IG Council is currently reviewing the matter. The IGs reported various measures of effectiveness. The IGs reported potential savings of about $43.3 billion resulting from their fiscal year 2009 audits and investigations. Given the IGs' fiscal year 2009 budget authority of about $2.3 billion, these potential savings represent about an $18 return on every dollar invested in the IGs. The IGs also reported about 5,900 criminal actions, 1,100 civil actions, 4,400 suspensions and debarments, and 6,100 indictments as a result of their work. In addition, the IGs reported enhanced effectiveness through additional actions taken to help prevent fraud in their agencies. For example, in fiscal year 2009 the Recovery Act created a requirement for the IGs to provide oversight of the economic stimulus funds disbursed by their agencies, and established the Recovery Accountability and Transparency Board of IG members to help carry out this oversight. As of June 2011, the IGs reported over 1,500 investigations opened, over 1,400 reviews completed, and over 2,000 training sessions provided to detect and prevent fraud, waste, abuse, and mismanagement in the use of Recovery Act funds. With respect to expertise, the IGs reported having backgrounds, academic degrees, and certifications in a range of areas related to their statutory responsibilities. The IGs reported backgrounds and academic degrees in accounting, auditing, financial analysis, law, management analysis, public administration, and investigations. In addition, the IGs, particularly the DFE IGs, reported numerous professional certifications related to their responsibilities.

section_title: Letter
paragraphs: The statutory federal inspectors general (IG) are instrumental in  enhancing government accountability through the results of independent  audits, investigations, and other reports on federal government programs  and operations. Independence is one of the most important elements of a  strong performing IG function, helping to ensure that the IGs’ work is  viewed as impartial by both their agencies and the Congress. In addition,  IGs must be independent in order to effectively carry out their mission to  help prevent and detect fraud, waste, abuse, and mismanagement and  promote economy, efficiency, and effectiveness. Further, to lead these  efforts, the IGs must bring the necessary expertise to bear on their work  through experience and professional qualifications.
As part of the Dodd-Frank Wall Street Reform and Consumer Protection  Act (Dodd-Frank Act), the Congress required GAO to report on the  relative independence, effectiveness, and expertise of federal IGs  appointed by the President and confirmed by the Senate (presidential)  and those appointed by agency heads in designated federal agencies  (DFE) as defined by the Inspector General Act of 1978, as amended (IG  Act). The Dodd-Frank Act also calls for GAO to report on the effect that  provisions in the Dodd-Frank Act have on the independence of the IGs.  Accordingly, the specific objectives of this report are to provide  information as reported by the IGs on their relative (1) independence  including the effect of provisions in the Dodd-Frank Act, (2) measures of  effectiveness, and (3) expertise and qualifications.
subsections: section_title: Background
paragraphs: The IG Act created independent IG offices at 30 major departments and  agencies with IGs appointed by the President, confirmed by the Senate,  and who may be removed only by the President with advance notice to  the Congress stating the reasons. (A listing of these 30 departments and  agencies with presidential IG offices is provided in app. I.) In 1988, the IG  Act was amended to establish additional IG offices located in 33 DFEs  defined by the act. (A listing of the DFEs with IGs is provided in app. II.)  Generally, the DFE IGs have the same authorities and responsibilities as  those IGs originally established by the IG Act, but with the distinction that  they are appointed and may be removed by their agency heads rather  than by the President and are not subject to Senate confirmation.  Although not in the scope of our review, there are 10 IGs established by  other statutes with provisions similar to those in the IG Act. (A listing of  the IGs established under other statutes is provided in app. III.)
The IGs appointed by the President are generally located in the largest  departments and agencies of the government; the DFEs have smaller  budgets and their IGs have correspondingly smaller budgets and fewer  staff. The presidentially appointed IGs and the DFE IGs reported to us  total budget authority for fiscal year 2010 of about $2.2 billion with  approximately 13,652 authorized full-time equivalent staff and 13,390  staff on board at the end of fiscal year 2010. The presidentially appointed  IGs’ budget authority constituted about 84 percent (about $1.8 billion) of  the total, and they had about 86 percent (11,564) of the total staff on  board. The budgets of the DFE IGs made up about 16 percent (about  $352 million) of the total budget authority for IGs, and they had about 14  percent (1,826) of the total staff on board at the end of fiscal year 2010.
The IG Reform Act of 2008 (Reform Act) amended the IG Act by adding  requirements related to IG independence and effectiveness. Among  other provisions, the Reform Act requires the rate of basic pay of the IGs  appointed by the President to be at a specified level, and for the DFE IGs,  at or above a majority of other senior-level executives at their entities.  The Reform Act also requires an IG to obtain legal advice from his or her  own counsel or to obtain counsel from another IG’s office or from the  Council of the Inspectors General on Integrity and Efficiency (IG  Council). The IG Act also provides protections to the independence of  the IGs while keeping both their agency heads and the Congress fully and  currently informed about particularly flagrant problems and deficiencies  within their agencies through a 7-day process specified by the act.
In addition, the Dodd-Frank Act amended the IG Act with provisions to  enhance the independence of IGs in DFEs with boards or commissions.  Specifically, the Dodd-Frank Act changed who would be considered the  head of the DFE for purposes of IG appointment, general supervision,  and reporting under the IG Act. If the DFE has a board or commission the  amendments would now require each of these IGs to report  organizationally to the entire board or commission as the head of the DFE  rather than an individual chairman. In addition, the Dodd-Frank Act  requires the written concurrence of a two-thirds majority of the board or  commission to remove an IG. Prior to this protection, most DFE IGs  reported to, and were subject to removal by, the individual serving as  head of the DFE.
The Reform Act also included a provision intended to provide additional  IG independence through the transparent reporting of their budgets.  Specifically, the Reform Act requires the President’s budget submission  to the Congress to have the IGs’ requested budget amounts identified  separately within their respective agency budgets, along with any  comments provided by the IGs on the sufficiency of their budgets.
The American Recovery and Reinvestment Act of 2009 (Recovery Act) is  one of the federal government’s key efforts to stimulate the economy in  response to the most serious economic crisis since the Great  Depression. The Recovery Act provided for IG oversight of the funds by  creating the Recovery Accountability and Transparency Board (Recovery  Board), which has an IG Chairman and 12 additional IG board members  to prevent and detect fraud, waste, and abuse in the stimulus-funded  programs. Altogether, there are 30 IGs involved with the oversight of  Recovery Act funds. (A listing of the IGs providing oversight of Recovery  Act funds is provided in app. IV).
Also, the IG Act includes a provision addressing the qualifications and  expertise of the IGs by specifying that each IG appointment is to be  without regard to political affiliation and solely on the basis of integrity and  demonstrated ability in accounting, auditing, financial analysis, law,  management analysis, public administration, or investigation. The fields in  which an IG can have experience are intended to be sufficiently diverse  so that many qualified people could be considered, but also limited to  areas relevant to the tasks considered necessary. The IG Act  Amendments of 1988 created DFE IGs but did not specify that these IG  appointments made by agency heads were to be without regard to  political affiliation and on the basis of demonstrated ability in specified  fields. The Reform Act addressed the differences in criteria for IG  appointment by providing the same provisions for both the DFE IGs and  the IGs appointed by the President.
section_title: Scope and Methodology
paragraphs: We addressed our reporting objectives through our summary of  responses to a survey sent to the federal statutory IGs established by the  IG Act regarding their activities for fiscal year 2010, and additional  analysis. We obtained and analyzed survey responses from 62 IGs  established by the IG Act: including 30 IGs who were appointed by the  President and confirmed by the Senate, and 32 DFE IGs. We  augmented the survey data with information obtained from prior GAO  reports, the President’s budget submission to the Congress for fiscal year 2011, and the IGs’ semiannual reports to the Congress.
For our discussion of the independence of the IGs, we summarized  information from the responses to our survey questions about the  implementation of selected provisions in the Reform Act, the IG Act, and  the Dodd-Frank Act that are intended to enhance IG independence.  Specifically, we asked all of the 62 IGs about the implementation of  Reform Act provisions intended to keep IG pay and salaries at a specified  level for IGs appointed by the President and consistent with other senior- level executives for the DFE IGs, and about the IGs’ sources of legal  counsel. Our survey also obtained information about the extent to which  the IGs found it necessary to communicate particularly flagrant problems  to their agency heads and the Congress within 7 days as prescribed by  the IG Act. These IG reports are commonly referred to as 7-day letters.
Regarding the effect of Dodd-Frank Act provisions to enhance  independence, we obtained the views of the 26 DFE IGs with boards or  commissions on whether their independence was enhanced by these  provisions designating their boards and commissions as DFE heads  rather than individual chairmen, and the requirement for the concurrence  of a two-thirds majority of the board or commission for removal of an IG.  We also obtained information from the President’s budget submission to  the Congress for fiscal year 2011, to determine whether the IG budget  amounts were separately identified along with any comments by the IGs  regarding the sufficiency of their budgets.
To address the effectiveness of the IGs, we obtained information on the  accomplishments of the IGs as reported to the IG Council for fiscal year  2009, in preparation for their annual report to the President. We also  obtained information reported by the Recovery Board on its mission and  accomplishments in providing oversight of Recovery Act funds. In  addition, our survey questionnaire obtained information for fiscal year  2010 on management challenges identified by the IGs reporting under  requirements of the Reports Consolidation Act of 2000. To identify the  extent of oversight provided by the IGs, we summarized the reported  management challenges to identify the major focus of these issues and  obtained IG reports relevant to these issues provided by the IGs to our  survey and from our review of the IGs’ semiannual reports to the  Congress.
To address the IGs’ qualifications and expertise we summarized the 62  IGs’ survey information provided on the background of each IG, including  professional experience, academic degrees, and professional  certifications obtained prior to being appointed to an IG position. We  compared this information to the areas of demonstrated ability specified  by the IG Act and summarized the number of IGs in each area.
We conducted our work from November 2010 to September 2011 in  accordance with all sections of GAO’s Quality Assurance Framework that  are relevant to our objectives. The framework requires that we plan and  perform the engagement to obtain sufficient and appropriate evidence to  meet our stated objectives and to discuss any limitations in our work. We  believe that the information and data obtained, and the analysis  conducted, provide a reasonable basis for any findings and conclusions.
We requested comments on a draft of this report from the IG Council.  Written comments from the IG Council are reprinted in appendix V and  summarized in the “Agency Comments” section of this report. We also  received and incorporated as appropriate technical comments from  several IG offices.
section_title: Independence
paragraphs: Our survey obtained information from 62 federal IGs appointed under the  IG Act on actions taken concerning legislative provisions in the Reform  Act and the IG Act intended to enhance IG independence. The IGs  reported    pay that was at the specified levels required by the Reform Act for IGs  appointed by the President and consistent with those of other senior- level officials as required for DFE IGs, thus helping to maintain IG  independence and enhance their relative stature within their agencies  by increasing their fixed compensation and eliminating discretionary  compensation that could create a conflict of interest;    having access to independent legal counsel reporting to an IG instead  of an agency management official, thus helping to ensure the  independence of legal advice available to the IG; and  rarely using 7-day letters as a way to independently inform agency  heads and the Congress of serious problems concerning agency  operations because such issues were resolved without the need for  such a letter.
We also surveyed the 26 DFE IGs affected by the Dodd-Frank Act  provisions intended to enhance IG independence for those IGs reporting  to boards or commissions. Just over half of these IGs responded that  the change of agency head to the full board or commission increased  their independence and most responded that the requirements for a two- thirds concurrence among the board or commission members prior to an  IG’s removal increased their independence.
In addition, based on our review of the President’s fiscal year 2011  budget submission to the Congress, the IGs’ budget amounts were not  always separately identified as required by the Reform Act. To the extent  the IGs’ budgets are separately identified, the added transparency of  these amounts to the Congress can help increase IG independence. After  we informed the IG Council about the results of our review concerning the  IGs’ budgets, they agreed to review and assess the matter.
subsections: section_title: IGs Reported Having Pay at Required Levels
paragraphs: The Reform Act addressed the compensation of IGs and requires that IGs  appointed by the President have their pay adjusted from Executive  Schedule IV to Executive Schedule III plus 3 percent. In addition, the  Reform Act requires that the grade, level, or rank designation for the DFE  IGs be set at or above that of a majority of the senior-level executives of  the agency, such as the general counsel, chief acquisition officer, chief  information officer, chief financial officer, and the chief human capital  officer at that agency. In addition, the DFE IG pay cannot be less than the  average total compensation (including bonuses) of the senior-level  executives at that agency calculated on an annual basis.
Of the 30 IGs appointed by the President, 27 reported being at or even  above the required pay level; with the remaining 3 IGs reporting that they  were in acting positions and the requirement was not currently applicable  to them. Of the 32 DFE IGs who responded to our survey, 29 reported  that their pay and salaries were consistent with those of the senior-level  executives of their agencies. Of the remaining 3 DFE IGs, 1 was newly  established in fiscal year 2011 and had not yet determined an amount of  pay consistent with senior-level executives, 1 IG reported having the  correct salary but not the corresponding grade level, and 1 IG was in an  acting capacity and reported the requirement was not currently  applicable.
section_title: IGs Reported Having Access to Independent Legal Counsel
paragraphs: The Reform Act also requires that each IG established by the IG Act have  his or her own legal counsel or obtain necessary legal counsel from  another IG office or from the IG Council. In a March 1995 report, we  reported that the IG community expressed concerns that IGs with  attorneys located organizationally in their agencies’ offices of general  counsel would not always receive independent legal advice and that the  IGs’ own independence could be compromised.
The results from our survey show that all the IGs established by the IG  Act reported having access to a legal counsel that is organizationally  independent, and none of the IGs rely on the general counsel offices of  their agencies. For the 30 IGs appointed by the President, 29 employ  their own legal counsel while 1 IG uses the legal services of another IG.  All 32 DFE IGs who responded to our survey indicated that they obtain  independent legal counsel, with 26 employing their own counsel, 5 using  the legal counsels of other IGs’ offices, and 1 using the legal resources of  the IG Council.
section_title: IGs Reported Rarely Using the 7-Day Letter
paragraphs: The IG Act provides a reporting tool that can protect the independence of  the IGs who report immediately to the agency head particularly serious or  flagrant problems, abuses, or deficiencies relating the administration of  programs or operations. The IG Act requires the agency head in turn to  transmit the IG report, with the agency head’s comments, to the  appropriate committees or subcommittees of the Congress within 7  calendar days.
We asked whether any of the 62 IGs we surveyed had used the 7-day  letter at any time during fiscal years 2008, 2009, and 2010. Only one, a  presidentially appointed IG, had used the 7-day letter during this time  frame. Specifically, on May 6, 2009, the IG delivered a report to the acting  head under the IG Act provisions for a 7-day letter, in which the IG  disagreed with the terms of a settlement reached by the agency with a  grantee. The acting head provided the IG’s report to the chairmen of  numerous congressional committees on May 12, 2009, which was within  the 7-day time frame. The IG’s report gained the interest of congressional  members and the issues were resolved by the President.
Generally, issues have been resolved more informally before getting to  the point of using a 7-day letter. In 1999 we reported that no IGs had  used the 7-day letter during the period of January 1990 through April  1998. In addition, we reported that a 10-year review of the IG Act by the  House Committee on Government Operations in 1988 found that the IGs  viewed the use of the 7-day letter as a last resort to attempt to force  appropriate action by the agency.
section_title: IGs in DFEs with Boards and Commissions Generally Responded That the Dodd-Frank Act Provisions Enhance Independence
paragraphs: Provisions of the Dodd-Frank Act amending the IG Act are intended to  provide an additional degree of independence to those IGs in DFEs with  boards or commissions. Specifically, the Dodd-Frank Act provides that  the head of the DFE with a board or commission will be the board or  commission and consequently, the IG appointment is no longer subject to  the judgment of a single individual. In addition, the Dodd-Frank Act  requires the written concurrence of two-thirds of the members of these  DFE boards and commissions for the removal or transfer of their IGs.
Twenty-six of the 33 DFE IGs are in DFEs with boards and  commissions. Of these 26 DFE IGs, 14 reported that the act’s provision  designating the boards and commissions as the DFE heads enhances  their independence, and 20 responded that their independence is  enhanced by requiring a two-thirds majority for their removal. A smaller  number of affected IGs stated that these provisions had no effect on their  independence, with 10 stating that the provision specifying the board or  commission as the head had no effect and 5 reporting that the removal  provision had no effect.
One DFE IG affected by the provisions did not respond to these survey  questions. Also, a former DFE IG stated that reporting to his commission  would reduce his independence because the commission has both  federal and state members. However, the current IG who took office  during our review stated that the primary concern is how nonfederal  members would exercise their authority over a federal IG.
section_title: IG Budget Amounts Are Not Always Identified in the President’s Budget Submissions
paragraphs: The Reform Act amended the IG Act to require that IG budget requests  include certain information and be separately identified in the President’s  budget submission to the Congress. In addition, along with the separately  identified IG budgets, the IGs may include comments with respect to the  budget if the amount of the IG budget submitted by the agency or the  President would substantially inhibit the IG from performing the duties of  the office. These budget provisions are intended to help ensure adequate  funding and additional independence of IG budgets by providing the  Congress with transparency into the funding of each agency’s IG while  not interfering with the agency head’s or the President’s right to formulate  and transmit their own budget amounts for the IG.
The fiscal year 2011 budget included amounts for 28 of the 30  presidentially appointed IGs. One presidentially appointed IG office was  newly established and not included in the full fiscal year 2011 budget  process. However another IG subject to these requirements did not have  a specific budget amount separately disclosed in the President’s budget.  Of the 28 presidential IGs with budget amounts separately disclosed in  the President’s budget, 1 included comments indicating that the IG’s fiscal  year 2011 budget would substantially inhibit the IG from performing the  duties of the office.
Regarding the DFE IGs, the President’s budget had specific budget  amounts for only 7 of the 33 DFE IGs. There were four newly established  DFE IGs that were not part of the full fiscal year 2011 budget process.  The President’s budget did not contain specified budget amounts for the  22 remaining DFE IGs subject to these requirements. We notified the IG  Council that most of the DFE IGs and one presidentially appointed IG did  not have separate budget amounts included in the President’s budget  submission to the Congress. The IG Council has responded that it will  review and assess this matter and, if necessary, work with congressional  and administration officials to resolve this issue.
section_title: Effectiveness
paragraphs: The IGs’ effectiveness was reflected in a range of reported  accomplishments, such as potential dollars to be saved by the  government through the results of federal IG audits, investigations, and  other reports. In addition, IG effectiveness was demonstrated in their  efforts to help prevent fraud, waste, and abuse. For example, IGs in  agencies receiving Recovery Act funds have reported providing oversight  in the areas of establishing and maintaining controls to help ensure the  funds are used properly. Also, the IGs’ effectiveness was demonstrated  by their reporting on oversight of management challenges identified at  their agencies.
subsections: section_title: IGs Reported Significant Measurable Accomplishments
paragraphs: In their annual report to the President, the IGs established by the IG Act  identified billions of dollars in savings and cost recoveries and other  accomplishments resulting from their work in fiscal year 2009. As part of  this report for fiscal year 2009, these IGs identified $43.3 billion in  potential savings from audits and investigations; and reported over 5,900  criminal actions, 1,100 civil actions, 4,460 suspensions or debarments,  and over 6,100 indictments resulted from their work. Based on this  information, the potential dollar savings reported by these IGs represent a  return on investment of approximately $18 for every IG dollar spent when  compared to total IG fiscal year 2009 budget appropriations of   $2.3 billion.
section_title: Recovery Board Reports of IG Effectiveness
paragraphs: In addition to measurable accomplishments, IGs also reported actions  taken to prevent problems within their agencies, although these outcomes  are more difficult to measure. For example, the IGs assisted in the  oversight of expenditures authorized by the Recovery Act by reporting on  preventive measures taken to help reduce the vulnerability of Recovery  Act disbursements to fraud, waste, and abuse. The Recovery Act requires  IG reviews of concerns raised by the public about investments of stimulus  funds and provides IGs the authority to examine records and interview  Recovery Act fund contractors and grantees. The Recovery Act  established the Recovery Board whose members include 12 IGs and an  additional IG as the chair, to coordinate and conduct oversight of funds  distributed under the act in order to prevent fraud, waste, and abuse. In  addition, the board is charged under the act with establishing and  maintaining a user friendly website to foster greater accountability and  transparency in the use of Recovery Act funds. To help prevent fraud and  other potential wrongdoing, the IGs offered training to federal, state, and  local employees, as well as contractors, private entities, and award  recipients. The IGs’ training was intended to improve awareness of the  legal and administrative requirements of the Recovery Act programs.
As of June 2011, the Recovery Board reported that the IGs received over  7,000 complaints of wrongdoing associated with Recovery funds, opened  over 1,500 investigations, and completed over 1,400 reviews of activities  intended to improve the use of Recovery Act funds. In addition, the  Recovery Board reported that IGs have provided over 2,000 training  sessions to almost 139,000 individuals on the requirements of Recovery  Act programs, how to prevent and report fraud, and how to manage grant  and contract programs to meet legal and administrative requirements.
section_title: Management Challenges Emphasize Agency Mission Issues
paragraphs: The management challenges reported annually by federal agencies in  their performance and accountability reports along with relevant IG  reports to address these challenges are key to focusing on effective IG  oversight. The identification of management challenges by the IGs began  in 1997 when congressional leaders asked the IGs to identify the 10 most  serious management problems in their respective agencies. This request  began a yearly process that continues as a result of the Reports  Consolidation Act of 2000. This act calls for executive agencies to include  their IGs’ lists of significant management challenges in their annual  performance and accountability reports to the President, the Office of  Management and Budget, and the Congress.
Not all agencies with IGs have requirements to report management  challenges. Fifty-four of the IGs we surveyed reported having certain  responsibilities for identifying management challenges in their agencies  for fiscal year 2010. Through our survey, 27 of the IGs appointed by the  President and 27 of the DFE IGs reported their agencies’ management  challenges and provided examples of audit reports that addressed about  90 percent of those challenges reported.
The responses from the IGs appointed by the President show that most of  the 203 management challenges they reported for fiscal year 2010  focused on issues specific to their agencies’ missions and performance  management. (See fig. 1.) For example, the National Aeronautics and  Space Administration’s IG reported that major changes to the direction of  the nation’s space program present several management challenges, and  the Department of Health and Human Services IG cited the management  challenges associated with delivery of the nation’s health care. The other  management challenges addressed by the IGs relate to information  technology, procurement, financial management, and human resources.
In addition, to provide oversight coverage of management challenges, the  presidential IGs issued reports that addressed about 93 percent of the  management challenges identified. These reports contained  recommendations for improving the weaknesses specified by the  management challenges. For example, the Federal Deposit Insurance  Corporation IG recommended strengthening specific controls over  managing the closing process for failed financial institutions which is a  key aspect of FDIC’s mission regarding insured depository institutions.  Also, the Social Security Administration IG identified transparency and  accountability issues as an agency management challenge and provided  report recommendations for improved performance in this area.
The DFE IGs reported 124 management challenges for fiscal year 2010,  with a focus on their agencies’ missions, information technology, and  performance management. (See fig. 2.) For example, the Farm Credit  Administration’s IG reported management challenges related to the  safety, soundness, and mission accomplishment of the Farm Credit  System. In addition, information technology, including information  security, was often identified as a management challenge. For example,  the Federal Maritime Commission’s IG and the National Labor Relations  Board’s IG identified challenges in upgrading their agencies’ management  systems. The performance management issues the DFE IGs identified as  management challenges included timely implementation of IG  recommendations by the Peace Corps and expanding public access at  the National Archives and Records Administration. The management  challenges included in the “other” category included concerns over  internal controls, improper payments, and the security of federal property.
In addition, the DFE IGs issued reports that addressed almost 90 percent  of the management challenges identified and contained  recommendations for corrective actions. For example, the Farm Credit  Administration IG assessed the agency’s readiness to take enforcement  actions related to its mission. In another example, the Postal Service IG  provided recommendations to improve the efficiency of postal operations  related to performance management in sorting the mail.
section_title: Expertise
paragraphs: The 62 federal IGs responding to our survey reported information on their  expertise and qualifications including the backgrounds, academic  degrees, and professional certifications. The IGs’ information showed a  wide range of backgrounds, skills, and professional certifications relevant  to their work consistent with the areas of demonstrated experience  specified by the IG Act. Figure 3 summarizes the background  experiences of the 62 IGs who responded to our survey. Most of the IGs  appointed by the President reported that they had a background in  criminal justice, investigations, law enforcement, and public  administration, while most of the DFE IGs had backgrounds in inspections  and evaluations, criminal justice, investigations, law enforcement,  accounting and auditing, and financial analysis.
As summarized in figure 4, we also obtained information on the academic  degrees obtained by the 62 IGs. Most of the IGs reported having degrees  in areas that are relevant to performing in an IG position and in areas of  demonstrated experience specified by the IG Act. To illustrate, 15 (about  half of the IGs appointed by the President) had law degrees and 1  presidential IG had a degree in an accounting and auditing area. Twelve  DFE IGs had law degrees and an equal number of DFE IGs had degrees  in accounting and auditing related areas. Additional degrees were  reported by both presidential and DFE IGs in areas of criminal justice,  investigations, law enforcement; management analysis; and public  administration. Other academic degrees reported by presidential and DFE  IGs included mathematics, science, sociology, education, psychology,  and English.
With respect to professional certifications, 6 IGs appointed by the  President reported having professional certifications and 28 DFE IGs  reported they possessed at least one professional certification related to  their IG responsibilities. For the presidential IGs, 2 were certified fraud  examiners, 1 reported being a certified internal auditor, 1 reported being a  certified government financial manager, and 2 had certifications in  additional separate areas. Of the DFE IGs, 6 reported they are certified  public accountants and 6 reported that they are certified internal auditors.  Additional certifications reported by the DFE IGs include 6 certified  government financial managers, 4 fraud examiners, 3 certified information  systems auditors, and 7 with other certifications such as a certified  government auditing professional, certified information security manager,  certified information officer, and certified inspector general. (See fig. 5.)
section_title: Agency Comments
paragraphs: We received comments from the IG Council (reprinted in app. V), on  September 13, 2011. The council commented that the draft provided  useful information on the independence, activities, and accomplishments  of the federal inspectors general and, as such, will contribute to a greater  understanding of the work of the IGs in providing oversight to a wide  range of government programs. We also received, and incorporated as  appropriate, technical comments from several IG offices.
We will send copies of this report to members of the IG Council, including  the Office of Management and Budget’s Deputy Director for Management,  the Chairperson, the Vice Chairperson, and the IGs who participated in  our survey. We will also send copies of the report to the Chairman and  the Ranking Member of the Senate Committee on Finance.
If you have any questions or would like to discuss this report, please  contact me at (202) 512-8486 or raglands@gao.gov. Contact points for  our Offices of Congressional Relations and Public Affairs may be found  on the last page of this report.
section_title: Appendix I: Departments and Agencies with Inspectors General1
paragraphs: IGs established by the IG Act of 1978, as amended, with appointment by the President  and Senate confirmation.
section_title: Appendix II: Designated Federal Agencies with Inspectors General1
paragraphs: IGs established by the IG Act of 1978, as amended, with appointment by the agency  head. In addition, the Department of State IG provides oversight of the Broadcasting  Board of Governors, which is a designed federal entity.
section_title: Appendix III: Agencies and Offices with Inspectors General Established by Various Statutes
section_title: Appendix IV: Departments and Agencies with Inspectors General Responsible for Oversight of Recovery Act Funds
paragraphs: The IG is a member of the Recovery Accountability and Transparency Board.
section_title: Appendix V: Comments from the Council of the Inspectors General on Integrity and Efficiency
section_title: Appendix VI: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Jackson W. Hufnagle, Assistant  Director; Jacquelyn Hamilton; Werner F. Miranda Hernandez; Rebecca  Shea; and Clarence A. Whitt made key contributions to this report.