Inspectors General: Continued Actions Needed to Strengthen IG Oversight of the United States International Trade Commission
Published: 2010-10-22T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Inspectors general (IG) are to provide independent and objective oversight; however, the United States International Trade Commission (USITC) has relied on acting and temporary IGs for an extended period of time. GAO was asked to determine (1) the extent of oversight provided by the USITC IG, (2) the budget and staffing resources available for oversight, and (3) how the role of the IG is addressed in the governance of USITC. To accomplish these objectives, GAO reviewed USITC IG reports and budgets for fiscal years 2005 through 2009, and relevant policies and procedures regarding governance and accountability. GAO also interviewed the USITC Chairman, Commissioners, current and former acting and temporary IGs, and office directors.
section_title: What GAO Found
paragraphs: The IG Act of 1978, as amended (IG Act), requires IGs to provide independent audits and investigations of the programs, offices, and activities in their respective federal entities. However, during the 5-year period reviewed, the USITC IG office conducted no audits and had no investigative case files or investigative reports of USITC. The IG office's oversight activities consisted primarily of monitoring and reviewing the work of independent public accountants (IPA) who conducted annual mandatory audits of USITC's financial statements and information security programs and practices. The most recent peer review of the USITC IG office's audit quality concluded that an opinion could not be rendered on the audit organization because no audits had been conducted by the IG in the past 5 years. The IG Act requires the designated federal entity heads to appoint an IG and provide adequate budgetary resources and sufficient staff. Both the lack of an appointed IG and constrained IG office budgets and staffing resources contributed to the limited oversight of USITC. From November 1, 2005, through December 5, 2009, USITC relied on acting IGs and a temporary IG to provide oversight. During this period the IG position was vacant for 17 months with no acting or temporary IG while USITC relied on the Assistant IG for Audits to provide oversight. Between fiscal years 2005 and 2009, the USITC budget increased about 23 percent, but the IG office budget resources remained relatively flat with funds only available for IPA-conducted audits and two staff during the last 4 years reviewed. The lack of comprehensive audit plans by the acting and temporary IGs to fully communicate their resource needs to USITC contributed to inadequate IG office resources and resulted in limited oversight. In fiscal year 2010, USITC appointed a Senior Executive Service-level IG to address requirements of the IG Reform Act of 2008. Also, consistent with the act, USITC provided a fiscal year 2010 IG office budget based on discussions with the current IG, which increased staffing and was certified by the IG as adequate. The IG stated that future oversight may require additional resources, which we believe can be communicated and justified by a staffing analysis as part of IG audit planning. The IG Act provides each IG with protections of independence including the authority for access to all entity documents and records. In addition, the IG is required to refer cases with potential violations of federal criminal law to the Attorney General. We found instances where the governance structure did not fully support the temporary USITC IG's responsibilities. Specifically, during 2009, the temporary IG was unable to obtain timely access to sensitive contract documents because USITC's policies and procedures did not clearly provide for IG access to such documents. The orientation book for the Commissioners, who may not have prior federal service, does not contain information about the USITC IG's authorities and responsibilities. In another instance, due to the lack of a formal policy or other agreement with the IG office, the Chairman referred the results of a possible criminal investigation to the Department of Justice (DOJ) without coordinating with the temporary IG, resulting in the potential for duplication of investigative efforts.
section_title: What GAO Recommends
paragraphs: GAO is making a recommendation to the USITC IG to prepare a staffing analysis as part of audit planning to determine the resources needed for effective oversight of USITC. GAO is also making recommendations to the USITC Chairman aimed at clarifying and communicating the authorities and responsibilities of the IG. In comments on a draft of the report, the USITC Chairman concurred with GAO's recommendations and stated corrective actions had been implemented. GAO agrees that one recommendation was fully implemented; however, additional actions are required to implement the remaining recommendations.

section_title: Letter
paragraphs: Inspectors General (IG) have a unique role within their agencies to identify  areas for improved economy, efficiency, and effectiveness through  independent and objective oversight; prevent and detect fraud, waste,  abuse, and mismanagement; and recommend corrective actions. In order  to fulfill their mission, IGs are expected to provide adequate oversight of  their agencies while maintaining a properly balanced and independent  working relationship with their agency heads and Congress.
The U.S. International Trade Commission (USITC) is an independent  federal agency with broad investigative responsibilities on matters of  trade, and its IG has oversight responsibilities for USITC’s operations.  However, factors such as reliance on acting and temporary IGs for an  extended period of time resulted in your concerns about the ability of the  USITC IG to provide adequate oversight. Reflecting your interest in  ensuring the independence and effectiveness of IGs, you asked GAO to  review (1) the extent of oversight provided by the USITC IG, (2) the  budget and staffing resources available to the IG office for oversight, and  (3) how the role of the IG is addressed through management and  governance of USITC.
To address these objectives, we reviewed the USITC IG office’s oversight  for fiscal years 2005 through 2009, by obtaining copies of all IG audit  reports and the semiannual reports to Congress and analyzing the nature  and extent of the audits performed. We reviewed internal USITC budget  documents to determine the resources available to the commission and  the IG office for the 5-year period and interviewed the current IG and three  former IGs who served in either an acting or temporary capacity to gain an  understanding of their available resources and staffing needs. We also  obtained information on program operations and the IG office oversight  from interviews with all USITC program directors directly responsible for  international trade issues and additional directors responsible for areas of  administrative support. In addition, we obtained information about the  governance of USITC by reviewing relevant polices, procedures, reports,  and other documents; and by interviewing the USITC Chairman and  Commissioners. For a detailed description of our scope and methodology,  see appendix I.
We obtained comments on a draft of this report from the USITC Chairman,  which are reprinted in appendix III. A summary of the Chairman’s  comments and our response are presented in the Agency Comments and  Our Evaluation section of this report.
subsections: section_title: Background
paragraphs: Congress established the basic functions of USITC on September 8, 1916,  as the U.S. Tariff Commission. In 1975, the name was changed to the U.S.  International Trade Commission by section 171 of the Trade Act of 1974.  USITC is headed by six Commissioners who are appointed by the  President and confirmed by the Senate for terms of 9 years, unless  appointed to fill an unexpired term. The terms are set by statute and are  staggered so that a different term expires every 18 months. No more than  three Commissioners may be members of the same political party. From  among the appointed Commissioners in office, the President designates a  Chairman and Vice Chairman to each serve for a 2-year term. The  Chairman may not be of the same political party as the preceding  Chairman, and the Chairman and the Vice Chairman may not be of the  same political party. The Chairman is responsible, within statutory limits,  for the administrative functions of USITC.
The mission of USITC is to (1) administer U.S. trade remedy laws within  its mandate; (2) provide the President, the U.S. Trade Representative, and  Congress with independent high-quality analysis, information, and support  on matters relating to tariffs and international trade and competitiveness;  and (3) maintain the Harmonized Tariff Schedule of the United States  (HTS). Through the Director of Operations, five offices—Offices of  Economics, Industries, Investigations, Tariff Affairs and Trade  Agreements, and Unfair Import Investigation—are responsible for USITC’s  operations regarding international trade. See appendix II for additional  information on USITC operations.
The Inspector General Act of 1978 (IG Act), as amended, provides the legal  foundation for the federal executive branch IG offices. Currently there are  59 IGs established by the IG Act throughout the executive branch with  broad authority to conduct independent audits and investigations. Of the  59 IGs, the President, with the advice and consent of the Senate, appointed  29. These presidentially appointed IGs may only be removed by the  President. The other 30 IG Offices were established by the 1988  amendments to the IG Act in designated federal entities (DFE) named in  the legislation. The USITC IG is one of the 30 DFE IGs. Generally, the  DFE IGs have the same authorities and responsibilities as those IGs  established by the original IG Act of 1978; however, they are appointed  and may be removed by their entity heads rather than by the President and  are not subject to Senate confirmation. For purposes of the IG Act, the  USITC Chairman was the head of USITC during our review period.
The act provides the IGs with independence by authorizing them, among  other things, to select and employ their own staffs, make such  investigations and reports as they deem necessary, and report the results  of their work directly to Congress. In addition, the IG Act provides the IGs  with a right of access to information, and prohibits interference with IG  audits or investigations by agency personnel. The act further provides the  IGs with the duty to inform the Attorney General of suspected violations of  federal criminal law.
Congress passed the IG Reform Act of 2008 (IG Reform Act) to further  enhance IG independence and accountability. The act maintains the  framework and IG community that existed under the IG Act and adds  authorities and requirements to help build a stronger, more independent,  professional, and accountable IG community. The act requires that the  heads of entities, including USITC, and the President, for those IGs  appointed by the President, inform both houses of Congress 30 days  before taking actions to remove or transfer an IG. The act also provides a  statutory process for handling allegations of wrongdoing by IGs so that  such reviews are not done by the same management officials who are  subject to IG oversight.
The IG Reform Act also specifies that DFE IGs, such as the USITC IG, be  classified at a grade level or rank designation at or above those of a  majority of the senior-level executives of the DFE. It requires the head of  each DFE to transmit proposed budgets to the President with an aggregate  request for the IG, amounts for IG training, and amounts for the support of  the Council of the Inspectors General on Integrity and Efficiency (CIGIE).  In addition, the IG is to provide certification that the amount requested  satisfies all training requirements for the IG for that fiscal year and any  resources necessary to support the activities of CIGIE.
section_title: USITC IG Conducted Limited Oversight Activities during Fiscal Years 2005 through 2009
paragraphs: The IG Act requires IGs to provide independent audits and investigations  of the programs, offices, and activities of their respective federal entities.  However, during fiscal years 2005 through 2009 the USITC IG office did  not conduct any audits, and provided no investigative case files or reports  to indicate that any investigations had been performed. The IG office’s  oversight of USITC consisted primarily of monitoring and reviewing the  work of independent public accountants (IPA) who conducted mandatory  audits of USITC’s financial statements and information security as  required by specific statutes. The IPAs performed these audits under  contract with the acting and temporary IGs during this 5-year period with  no additional audits conducted by these IGs. The most recent peer review  of the IG office’s audit quality, performed by the National Archives and  Records Administration IG, concluded in a May 12, 2010, report that an  opinion could not be expressed on the audit organization because no  audits had been conducted in the past 5 years.
The USITC IG office also did not provide audits or perform follow-up in  areas with weaknesses identified by the IPAs’ audits. Specifically, the audit  of USITC’s fiscal year 2009 financial statements resulted in a disclaimer of  opinion by the IPA due to the lack of sufficient evidence to support the  amounts presented in the financial statements. The IPA also noted a  number of material and significant issues surrounding internal control and  concluded that USITC was not able to comply with the requirements of the  Federal Managers’ Financial Integrity Act. The Chairman and the  Director of the Office of Finance stated that the audit results primarily  stemmed from the implementation of a new financial system at the  beginning of fiscal year 2009. However, the IG’s office had not perform audits or other oversight of the new system and its implementation o r  related internal control.
In USITC’s annual Performance and Accountability Report, issued for  each year of our review, the IG office identified management challenges  related to USITC’s procurement and contract management, financial  management, human capital management plan, and budget and  performance integration. Issues related to USITC’s financial management  were annually audited through mandatory audits performed by IPAs.  However, the remaining management challenges were not audited by the  IG office, and therefore have not received audit recommendations for  corrective actions to address these identified weaknesses. (See table 1.)
Performance audits and other IG oversight activities can provide  managers, and those charged with governance, with information regarding  the economy, efficiency, and effectiveness of the programs, offices, and  activities reviewed, and may include assessments of internal control,  compliance, and prospective analyses. The USITC IG office’s limited  oversight of the programs, offices, and activities responsible for the  fundamental mission of USITC regarding international trade resulted in a  lack of valuable audit information for management to help improve  program performance and operations, reduce costs, facilitate decision  making, oversee or initiate corrective action, and contribute to  accountability.
section_title: USITC Lacked an Appointed IG and Adequate Staff Resources Prior to Fiscal Year 2010
paragraphs: The IG Act requires designated entity heads to appoint an IG and provide  adequate budgetary resources and sufficient staff for the IG’s office to  conduct independent audits and investigations. USITC lacked an  appointed IG and did not provide the IG office with adequate budget and  staff resources for fiscal years 2005 through 2009. This contributed  significantly to the IG office’s limited oversight of USITC and the lack of  audits and investigations. However, in fiscal year 2010, the USITC  Chairman appointed an IG and provided additional resources to the IG  office due, in part, to the requirements of the IG Reform Act.
subsections: section_title: The USITC IG Position Was Filled by Acting and Temporary IGs for an Extended Period before Appointment of the Current IG
paragraphs: For over 4 years, between November 2005 and December 2009, the USITC  relied on acting IGs and a temporary IG to provide oversight. In addition,  for a period of 17 months during this time—from March 2006 until August  2007—the USITC IG position was vacant. Specifically, when the IG retired  in October 31, 2005, the Chairman designated the Assistant IG for Audits  (AIGA) to serve as acting IG. When the acting IG position expired in March  2006, the Chairman sought to hire a new IG instead of renewing the acting  IG position. Although the USITC continued to rely upon the AIGA to fulfill  the requirements and responsibilities of the IG, the IG position was vacant.  The Chairman renewed the AIGA’s acting IG position in August 2007—17  months after it had expired.
The AIGA reported the vacant IG position in each of the semiannual  reports over this 17-month period. During this period, the AIGA did not  have the full statutory protections of independence and stated authorities  under the IG Act to provide audits and investigations; promote economy,  efficiency, and effectiveness; prevent and detect fraud and abuse; and  recommend actions for improvement to USITC.
In January 2008, the Chairman selected a former USITC budget officer to  serve as a temporary IG not to exceed 6 months of service, which was  extended for another 6 months starting in June 2008. In January 2009,  USITC extended the temporary IG position for another 6 months while the  Chairman and Commissioners studied how to implement the IG Reform  Act, which requires that DFE IGs, such as the USITC IG, be classified at a  pay level at or above a majority of the senior-level executives of the DFE.  In June 2009, USITC published a vacancy announcement for a permanent  IG position at the Senior Executive Service (SES) level. The temporary  IG was reassigned to another USITC office on August 16, 2009, and the  AIGA from the IG Office of the Commodity Futures Trading Commission  served as the acting USITC IG from August 17, 2009, to December 5, 2009.  On December 6, 2009, the Chairman appointed the first Senior Executive  Service (SES)–level USITC IG. See table 2 for a listing of the USITC IGs  and their periods of service.
section_title: USITC IG Received Limited Resources Prior to Fiscal Year 2010
paragraphs: The only specific budget resources provided to the IG office during fiscal  years 2005 through 2009 were the amounts for statutorily mandated audits  performed by IPAs. Despite increases in the overall USITC budget, the IG  office’s budget resources remained relatively flat and its staffing remained  below its authorized levels. Between fiscal years 2005 and 2009, the USITC  budget increased from $61 million to $75 million—approximately 23  percent—while the IG budget remained relatively constant. (See table 3.)  A former acting IG stated that in order to perform any additional  functions, including travel or training, she had to seek USITC’s permission  for each additional expense. Although the acting and temporary IGs were  authorized to have between three and four full-time equivalent (FTE) staff  members (including themselves) during 4 of the 5 years reviewed, their  offices did not receive the necessary funding to hire these authorized staff.  The former acting and temporary IGs we contacted also explained that  their oversight of USITC was limited because they did not have sufficient  resources to audit areas other than those required by specific statutes.
Ensuring the adequacy of audit resources is ultimately a responsibility of  the USITC Chairman. However, the USITC Commissioners told us that in  the past they were not made fully aware of the IG office’s need for  additional resources. The acting and temporary IGs had not prepared  comprehensive audit plans over the 5-year period with a staffing analysis  to justify additional budget and staffing resources and effectively  communicate their resource needs. As part of a comprehensive audit plan,  a staffing analysis provides the basis for determining the number and  experience level of the audit staff needed, external service providers,  financial support, technology-based audit techniques, and other resource  needs such as training and travel.
Consistent with provisions of the IG Reform Act, the USITC budget  request for fiscal year 2010 included IG budget information and the  required IG certification that the amounts are sufficient for training and  support of CIGIE activities. On the basis of discussions with the current  IG, USITC approved an IG budget of $816,837 with a total of 5 FTEs,  including a legal counsel who is also expected to conduct investigations.  With the assistance of the additional staff, the IG issued a series of audit  reports with recommendations regarding information security and internal  control. The current IG stated that future oversight may require  additional resources.
During our review, the current IG completed a strategic plan and an  annual audit plan for fiscal year 2011. These plans define the USITC audit  universe, provide goals for oversight, and specify the objectives and  anticipated starting dates for individual audits including mandatory audits,  audits of management challenges, and audits of program economy and  efficiency. While these plans are an important first step, neither the high- level strategic plan nor the annual audit plan for the coming year provide a  staffing analysis to identify the number of staff and other resources  necessary for a comprehensive audit plan that communicates and justifies  the IG budgets and staffing needed for USITC oversight.
section_title: Improvements Needed to Strengthen the IG’s Role within USITC Governance
paragraphs: The IG Act provides each IG with protections of independence including  the authority for access to all entity documents and records, and does not  allow the entity head to prevent or prohibit the IG from initiating, carrying  out, or completing any audit or investigation. In addition, the IG is required  to refer cases with potential violations of federal criminal law to the  Attorney General. These protections and responsibilities are necessary in  large part because of the unique reporting requirements of the IGs, who  are both subject to the general supervision of the heads of the agencies  they audit while at the same time expected to provide reports of their  work externally to Congress. During our review period, we found  instances where USITC’s governance structure did not fully support the  acting and temporary IGs’ responsibilities due to USITC’s lack of clear  policies surrounding IG access to information and the lack of coordination  with the IG office when referring an investigative case to the Department  of Justice (DOJ). The effectiveness and independence of IG’s are closely  related to the governance and accountability structure of the organization  and the role that the IG plays within that structure. IGs must be able to  operate independently within the governance framework at their  respective entities in order to be effective.
subsections: section_title: USITC Needs Clarifying Guidance on IG Access to Documents
paragraphs: The IG Act provides the authority for IG access to all USITC documents  and records, and also prohibits the agency head from preventing or  prohibiting the IG from initiating, carrying out, or completing any audit or  investigation. However, in 2009, the USITC IG was unable to obtain  prompt access to original USITC contract documents during an inquiry  into USITC procurement procedures because of the Chairman’s  uncertainty about the IG’s authority to have access. In the April 2009  semiannual report to Congress, the temporary USITC IG stated that on  March 5, 2009, a USITC employee removed certain procurement files from  the possession of the IG without the IG’s permission. The employee had  requested clarification from USITC management regarding the IG’s access  to the documents that the procurement office was responsible for  safeguarding, but received no clear answer. Due to the lack of guidance  from USITC management and the lack of a clear policy on IG access to  documents, the IG’s review was delayed until the issue was resolved, and  the IG’s inquiry ended without any record of an investigation.
Although USITC policies and procedures provide the IG with full access to  all USITC documents, they do not specify the process to be followed to  grant the IG access to original sensitive USITC documents that must be  safeguarded. In the example cited above, after deliberations with the  General Counsel, the Chairman provided the temporary IG access to the  documents after a delay of almost 2 months. However, the Chairman  included a written qualification that the IG’s full access to USITC  documents only applied to the specific files under the IG’s immediate  review. Consequently, future disagreements regarding the IG’s access to  USITC documents may occur until the IG’s authority is specifically  addressed by USITC policies and procedures.
The USITC program directors that we interviewed expressed their  concerns for the safety and security of the business and trade information  used during their international trade investigations and in the preparation  of their reports. However, IG access to both information and individuals is  essential for effective oversight and the IG Act specifically authorizes the  IG to have access to all records, reports, audits, reviews, documents,  papers, recommendations, or other material related to the programs and  operations of an entity.
In addition, the Commissioners told us that although USITC provides an  orientation book to inform newly appointed Commissioners about  USITC’s operations, this orientation information does not include a  section on the authority and responsibilities of the IG. Because  Commissioners are not always appointed from prior federal positions and  may not be aware of the important statutory independence of IGs, an  orientation book could include information to facilitate interactions with  the IG by minimizing uncertainties regarding the unique authorities and  responsibilities of the IG.
section_title: The USITC Chairman Did Not Always Coordinate Investigations with the IG Office
paragraphs: The IG Act requires the IG to report to the Attorney General whenever the  IG has reasonable grounds to believe federal criminal law has been  violated. The USITC Chairman also reports potential criminal violations to  DOJ. On June 15, 2009, the USITC Chairman referred a possible criminal  violation by a USITC employee to the Criminal Division of DOJ based on  an investigation conducted by USITC’s Chief Information Security Officer.  The USTIC Chairman neither informed the temporary IG of the  investigation performed by USITC, nor of the referral of the case to DOJ.  The lack of coordination could result in the duplication of efforts if both  the Chairman and the IG were to investigate the same subject.
In order to avoid duplication of investigative efforts, other federal entities  utilize a memorandum of understanding (MOU) or similar mechanism to  require the sharing of investigative information between the IG and the  entity. For example, the Treasury IG for Tax Administration (TIGTA) at  the Internal Revenue Service (IRS) within the Department of the Treasury  and the Chief of IRS Criminal Investigation have established an MOU that  specifies the areas to be investigated by each office to ensure coordination  while preventing duplication of efforts. A similar agreement between the  USITC Chairman and the IG could decrease the potential risk of  duplicative investigations.
section_title: Conclusions
paragraphs: Considering the need to enhance oversight of USITC, it is important that  an independent, objective, and reliable IG structure be in place to provide  adequate audit and investigative coverage of its programs, offices, and  activities. Effective USITC governance and accountability require policies  and procedures to help ensure that the activities of the IG are independent  and the results are viewed as independent by Congress and other users of  the IG’s work. USITC has recently made progress towards improving  governance and accountability; however, notwithstanding these advances,  we believe it is important to build on and sustain the progress made in  fiscal year 2010. Increased attention to USITC governance and  accountability through the design and implementation of policies and  procedures, and ongoing attention to the resource needs of the IG’s office,  would help to ensure that the activities of the IG are effective and  independent.
section_title: Recommendations for Executive Action
paragraphs: We recommend that the USITC IG    prepare a staffing analysis to determine the level of budget and staff  resources needed to conduct the audits identified in audit plans,  including audits required by statutes; audits of management challenges  identified by the IG; and performance audits of economy, efficiency,  and effectiveness of USITC’s programs, offices, and activities.
We recommend that the Chairman of USITC  revise the policies and procedures for all offices and programs to  recognize the authorities and responsibilities of the IG under the IG  Act, including procedures for recognizing the IG’s authority for access  to USITC documents, records, and information;  revise the formal written orientation information provided to the  Commissioners to include sections on  the overall authorities and responsibilities of the IG;  the IG’s authority and USITC’s policies for IG access to USITC  documents, records, and information; and  the responsibilities of the Chairman to maintain an appointed IG;  and    work with the IG to establish a memorandum of understanding (MOU)  or similar mechanism to ensure that all USITC investigative matters  that may cover areas also investigated by the IG are coordinated with  the IG’s office.
section_title: Agency Comments and Our Evaluation
paragraphs: We received written comments on a draft of this report from the USITC  Chairman, which are reprinted in appendix III. The USITC Chairman  stated that the agency is dedicated to ensuring the proper level of IG  oversight and looked forward to working with the IG to achieve enhanced  performance and accountability throughout USITC. The Chairman  concurred with our recommendations and identified actions taken to  implement them. We agree that USITC has fully addressed our  recommendation to establish an MOU to ensure the agency and IG  coordination of investigations of possible criminal violations; however,  while USITC has taken steps to address the remaining recommendations,  further corrective actions are necessary. Specifically, the USITC IG  prepared a staffing analysis for fiscal year 2010 audits that allowed him to  hire additional staff; however, we continue to recommend that the IG  develop a staffing analysis to support the audits in future years identified  by the IG’s strategic plan. Also, although USITC prepared an MOU  addressing the IG’s authorities and responsibilities regarding access and  custody of USITC records, USITC has yet to include this information in the  policies and procedures for the offices subject to the IG’s review. Further,  USITC prepared an overview of the IG’s authority and responsibilities to  be included in the orientation of the USITC Commissioners, but has not  yet provided a place for it in the formal orientation of the Commissioners.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we will not distribute it until 30 days from its date. At  that time we will send copies of the report to the USITC Chairman; USITC  IG; Deputy Director for Management, Office of Management and Budget;  Chairman of the Senate Committee on Finance; and other parties. This  report will also be available at no charge on the GAO Web site at  http://www.gao.gov.
If you have any questions or would like to discuss this report, please  contact me at (202) 512-9095 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. Major contributors to this report are listed in  appendix IV.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine the extent of oversight provided by the U.S. International  Trade Commission (USITC) Inspectors General (IG) during fiscal years  2005 through 2009, we obtained and reviewed the results of the IGs’ audit  reports and investigative activity as reported in the IGs’ semiannual  reports to Congress for the 5-year period. We also identified the  management challenges identified by the USITC IGs over the 5-year  period. In addition, we compared IG audit activity to these reports over  the same 5-year period to determine the nature and extent of oversight  provided in areas of identified weaknesses. We further identified the  programs and offices responsible for carrying out USITC’s mission from  relevant performance and accountability reports and compared them with  the areas covered by the IG’s audits.
We analyzed the budgets and staffing resources for the USITC IGs for  fiscal years 2005 through 2009 by reviewing IG planning documents and  budget requests to USITC management as well as internal entity budget  documents. We also obtained USITC’s overall budget and staffing from the  President’s Budget of the United States Government and compared  USITC’s budgets for the 5-year period to the IG’s budgets. We also  interviewed the current and former acting and temporary IGs who were in  office from November 1, 2005, to the present time to gain an understanding  of the conditions of their employment, obtained Office of Personnel  Management documents to verify their employment status, and gained an  understanding of the level of audit oversight provided based on available  resources.
To determine how the role of the IG is addressed in the governance and  management of USITC, we reviewed existing policies and procedures  regarding the governance and management of USITC for accountability  and regarding the IG; interviewed the Commissioners; and obtained  information from the former acting and temporary IGs as well as the  current IG. We also reviewed the statutory roles and responsibilities of the  IG for independent audits and investigations as provided by the IG Act and  noted where the activities of USITC governance were not consistent with  the independence principles of the act. We reviewed the activities of  USITC management regarding requirements for IG access to information  by analyzing information obtained through interviews with USITC  program directors, the former IGs, the USITC Chairman, former Chairmen,  and the Commissioners. We also reviewed internal USITC documents  related to the deliberation of the roles and responsibilities of the IGs. To  obtain information about the investigative case referred to the Department  of Justice (DOJ), we interviewed the IG Counsel at the Treasury IG for Tax  Administration, Internal Revenue Service, who provided legal counsel to  the USITC IG office.
We conducted this performance audit from November 2009 to October  2010 in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform the audit to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
section_title: Appendix II: Major USITC Operations, Offices, and Roles and Responsibilities
paragraphs: Information about the structure and activities of the U.S. International  Trade Commission (USITC) is shown in table 4.
Additional USITC offices support the work of the five major operations  shown in table 4:    The Office of the Administrative Law Judges holds hearings and makes  initial determinations in investigations of intellectual property–based  imports.
The Office of the General Counsel serves as the chief legal advisor.    The Office of the Director of Operations provides supervision of USITC  offices that provide the five major operations.
The Office of External Relations develops and maintains a liaison between  USITC and its diverse external customers.
The Office of the Chief Information Officer provides information  technology leadership including information security.
The Office of the Director of Administration compiles and monitors the  annual budget, and provides services for human capital, procurement,  facilities management, and physical security.
The Office of Equal Employment Opportunity administers the affirmative  action program and advises the Chairman and the Commissioners on equal  employment issues.
The Office of the Secretary coordinates hearings and meetings and is  responsible for official record keeping.
section_title: Appendix III: Comments from the Chairman, U.S. International Trade Commission
section_title: Appendix IV: GAO Contact and Staff Acknowledgments
subsections: section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Jackson Hufnagle, Assistant  Director; Clarence Whitt; Francis Dymond; Jacquelyn Hamilton; and  Cynthia Jackson made key contributions to this report.