Immigration Application Fees: Costing Methodology Improvements Would Provide More Reliable Basis for Setting Fees
Published: 2009-01-23T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Department of Homeland Security's (DHS) U.S. Citizenship and Immigration Services (USCIS) is responsible for granting or denying immigration benefits to individuals. USCIS charges fees for the millions of immigration applications it receives each year to fund the cost of processing and adjudicating them. In February 2007, USCIS completed a study to determine the full costs of its operations and the level at which application fees should be set to recover those costs. USCIS's new fee schedule increased application fees by a weighted average of 86 percent. Almost 96 percent of USCIS's fiscal year 2008 budget of $2.6 billion was expected to have come from fees. GAO was asked to review the methodology USCIS used in its fee review and controls in place over collection and use of fees. In this report, GAO addresses the consistency of the methodology with federal accounting standards and principles and other guidance, including whether key assumptions and methods were sufficiently justified and documented. The report also addresses internal controls USCIS has in place over the collection and use of fees.
section_title: What GAO Found
paragraphs: In 2007, USCIS completed a fee review in which USCIS estimated the costs of its immigration application processing and adjudication services and, in accordance with management's objective, set the fees at a level to recover those costs. The methodology USCIS used in its review, however, did not consistently adhere to federal accounting standards and principles and other guidance. While federal accounting standards allow flexibility for agencies to develop managerial cost accounting practices that are suited to their needs, they also provide certain specific guidance based on sound cost accounting concepts. USCIS's methodology, for example, did not include the costs paid by other federal entities on behalf of USCIS. Federal standards and guidance also call for documentation that is sufficient to allow an understanding of and provide justification for the cost assignment processes and data used. USCIS did not adequately document the detailed processes used or sufficiently justify assumptions used in allocating costs to various activities on a prorated basis. As a result, USCIS could not show that its methods provided a reasonable distribution of the costs to the various types of applications. For instance, USCIS allocated $732 million of overhead costs (or 31 percent of total costs)--including information technology operations and maintenance--to offices based on the number of staff full-time equivalents (FTE) in each office. However, USCIS's documentation did not sufficiently justify (1) why cost allocation was used instead of other possible methods or (2) why it did not include about 6,100 contract workers and used only approximately 7,900 FTEs of the total federal FTEs of about 10,400 as the basis for allocation. USCIS also did not adequately justify the equal assignment of activity costs representing 51 percent of total costs to each application type. While such pro rata assignment of costs may be a reasonable method in some circumstances, USCIS did not document its justification for the assumptions made when deciding which costs to allocate on a prorated basis and how those costs should be allocated. Because of these inconsistencies with federal accounting standards and principles and other guidance, USCIS cannot support the reasonableness of cost assignments to the various application types. USCIS has implemented accountability mechanisms to track the use of both regular application fees as well as premium processing fees intended for specific projects. USCIS plans to use its premium processing fee collections to fund its transformation program to make long-term improvements to its business processes and technology. Through its monitoring of fee collection procedures, USCIS has identified some weaknesses at one of its service centers. It has taken actions to strengthen service center controls in the short term, and it is moving all fee receipt functions and the application processing done in preparation for adjudication to lockbox facilities to further strengthen control over collections.

section_title: Letter
paragraphs: U.S. Citizenship and Immigration Services (USCIS), an agency of the  Department of Homeland Security (DHS), is responsible for granting or  denying immigration benefits to individuals seeking to become citizens of  the United States or to study, work, or live in this country. In carrying out  its responsibilities, USCIS processes and adjudicates millions of  immigration and naturalization applications each year, administers work  authorizations and other petitions, and provides services for new residents  and citizens.
To fund the cost of processing and adjudicating applications and  associated support services, USCIS charges application fees that are  deposited in the Immigration Examinations Fee Account (IEFA) and are  available until expended. Businesses desiring to hire foreign nationals  may pay an additional fee to accelerate the processing of certain types of  applications, such as those for workers in specialty occupations or  temporary workers. Congress authorized this fee to be used to provide  certain premium processing services to business customers, and to make  infrastructure improvements in the adjudications and customer service  processes.
GAO and DHS’s Inspector General have reported the need for USCIS to  improve its processes, systems, and technology and noted that USCIS’s  efforts to modernize have been unfocused, conducted in an ad hoc and  decentralized manner, and, in certain instances, duplicative. In 2006,  USCIS embarked on a transformation of its business processes and  technology to move its operations from paper-based processes to an  electronic environment. USCIS plans to fund its transformation program  mostly with premium processing fees.
In the past, in addition to its fee collections, USCIS received other  appropriations from annual appropriations acts (i.e., direct  appropriations) to help fund its operations. USCIS received appropriated  funds to pay for administrative costs through fiscal year 2004. USCIS also  received appropriated funds for specific projects, such as the initiative to  reduce the backlog of pending applications, from fiscal year 2002 through  2006 and its business transformation program in fiscal years 2006 and  2007. In fiscal year 2007, USCIS received direct appropriations for  Systematic Alien Verification for Entitlements (SAVE). USCIS also  received direct appropriations for E-Verify in fiscal years 2007 and 2008.
We have previously reported that fee collections had not been sufficient to  recover USCIS’s full operating costs. To provide funding to cover the  shortfall from application fees, USCIS used the direct appropriations  discussed above, and it used premium processing fees and fees from  applications that were waiting to be processed.
In February 2007—to determine the full costs of its operations and the  level at which application fees should be set to recover those costs— USCIS completed a review of the processes involved in providing  adjudication services and the resources needed. Based on the review,  USCIS implemented a new fee schedule effective July 30, 2007, which  increased application fees by a weighted average of 86 percent. (See app.  II for a list of applications and their fees.) USCIS expects that the  increased application fees will cover the costs of its immigration  application processing and adjudicating services.
Almost 96 percent of USCIS’s fiscal year 2008 budget of $2.6 billion was  expected to have come from fee collections, with the residual coming from  direct appropriations and from other federal agencies for work done by  USCIS on their behalf. It is important that USCIS reliably accumulate and  analyze the costs of its application processing services as a basis for  setting fees and recovering costs and to offer insights for managing its  programs and activities. At your request, we reviewed the methodology  USCIS used in its fee review to develop the current fee schedule and  controls USCIS has put in place over the collection and use of the fees.  Specifically, this report addresses the consistency of the costing  methodology USCIS used to develop the current fee schedule with federal  accounting standards and principles and other guidance, including  whether USCIS sufficiently justified and documented its assumptions and  methods. The report also addresses internal controls in place over the  collection and use of fees.
In conducting our work, we considered federal accounting standards,  Office of Management and Budget (OMB) guidance on user fees, and  federal internal control standards. We reviewed USCIS documents related  to the fee review and its methodology. We obtained an understanding of  the methodology and reviewed the design and operation of USCIS’s cost  system, including its cost accumulation methods and how it assigned costs  involved in adjudicating and processing various types of immigration  applications. We performed a walk-through of the USCIS process for  accumulating specific types of costs and performed analytical reviews and  discussed with USCIS officials key assumptions and decisions concerning  distributing these costs to applications as their basis for setting fees. We  visited all four USCIS service centers in Laguna Niguel, California; Lincoln,  Nebraska; Mesquite, Texas; and St. Albans, Vermont, and a lockbox facility  in Chicago where we observed fee collection processes. We discussed  with USCIS officials and staff the processes for tracking and monitoring  fee collections and related expenditures and reviewed corroborating and  other relevant documentation.
Appendix I provides additional details about our scope and methodology.  We conducted this performance audit from October 2007 to January 2009  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.
subsections: section_title: Background
paragraphs: USCIS is responsible for establishing immigration services policies and  priorities and for the administration of immigration and naturalization  adjudication functions. Its approximately 16,000 federal and contractor  employees work in 250 offices worldwide, including field offices,  application support centers, service centers, asylum offices, national  customer service call centers, and forms centers. About 6 million  applications and petitions for immigration and naturalization benefits,  along with applicable fee payments, are submitted to USCIS annually.  USCIS adjudicators process applications and petitions in four general  categories:family-based petitions—for close relatives to immigrate, gain permanent  residence, or work in the United States;   employment-based petitions—for current and prospective employees to  immigrate to or stay in the United States temporarily;   asylum and refugee applications—for those seeking asylum or refugee    naturalization applications—for those who wish to become United States  citizens.
USCIS is authorized to collect fees for providing adjudication and  naturalization services at a level that will (1) ensure recovery of the full  costs of providing all such services, including the costs of similar services  provided without charge to asylum applicants, and (2) recover any  additional costs associated with the administration of the fees collected.  In 1968, the Immigration and Naturalization Service (INS), USCIS’s  predecessor agency, began charging fees for immigration and  naturalization services, depositing the fee collections into the General  Fund of the Treasury as miscellaneous receipts. In 1988, Congress  established the IEFA. Since 1989, application fees have been deposited in  the IEFA, which is currently USCIS’s primary source of funding. Once  deposited in the IEFA, the fees remain available to USCIS until expended.  In fiscal year 1991, Congress directed that the IEFA also be used to fund  the cost of asylum and refugee services and adjudication services provided  to some immigrants at no charge, and thus, the charges for fee-paying  applicants were increased to recover these costs.
In December 2000, Congress authorized the establishment of a premium  processing program for employment-based applications. INS proposed the  establishment of a premium processing service to provide businesses with  a high level of customer service and improved processing because it could  not otherwise meet the demand for expeditious service to the business  community without an adverse impact on other applications. According to  the INS Commissioner, an optional additional fee of $1,000 for business  customers would also make capital available for infrastructure  improvements. In response, Congress authorized the premium processing  service; set the fee at $1,000, which is to be paid in addition to the regular  application fee; and specified that it be used to provide accelerated  processing services to business customers and to make infrastructure  improvements in the adjudications and customer service processes. The  premium processing service is to provide processing of certain  employment-based petitions and applications within 15 calendar days of  receipt of the request for premium processing service form. Premium  processing fees also are deposited in the IEFA to be available until  expended.
Currently, funding for USCIS comes from three fee accounts, direct  appropriations, and reimbursements from other federal agencies. Table 1  shows the five funding sources and the amounts estimated for fiscal year  2008.
In past years, USCIS received larger amounts of direct appropriations to  pay for administrative costs and for specific projects, such as the initiative  to reduce its backlog of pending applications and its business  transformation program to make long-term improvements in its business  processes and technology. USCIS also received direct appropriations for  two other specific programs—SAVE in fiscal year 2007 and E-Verify in  fiscal years 2007 and 2008.
The three fee accounts provide almost 96 percent of USCIS’s total fiscal  year 2008 budgetary resources. The fee review that is the subject of this  report covers the application fees deposited in the IEFA, which is  budgeted to provide approximately 94 percent of USCIS’s funding for  fiscal year 2008. If the number of applications and fee payments received  in a year is more than projected, USCIS can increase its spending authority  to cover the increased workload, and thus get additional funds from the  IEFA through reprogramming after it has notified Congress.
Persons seeking immigration and naturalization benefits submit their  applications and associated fees to one of four service centers, local  offices within one of four regions, or one of two lockbox facilities,  depending on the application type and geographic location of the  applicant. Some applications can be filed electronically with payment by  credit or debit card or electronic transfer of funds. In addition, some  applications require biometric services—collecting information such as  fingerprints, photographs, and signatures for background checks  conducted by the Federal Bureau of Investigation (FBI)—for which a  separate fee is charged.
The four service centers (located in California, Nebraska, Texas, and  Vermont), the National Benefits Center (located in Missouri), and many  local offices receive, process, and adjudicate applications and petitions for  immigration benefits. Contract employees generally are responsible for  preadjudication processing steps, such as mail room operations, fee  collection, data collection, and file operations. USCIS employees  adjudicate the applications, that is, they make determinations about  whether to approve the benefits for which an applicant has applied.
Lockbox facilities located in Chicago and Los Angeles receive certain  application types and the related fee payments. Banks that operate the  lockbox facilities are designated by Treasury’s Financial Management  Service (FMS) as financial agents of the United States. They perform  services for USCIS under a memorandum of understanding between the  lockbox facility, FMS, and USCIS. Lockbox facilities are responsible for  mail room operations, data entry, fee collection, setting up files, and  sending the files to a service center or the National Benefits Center for  adjudication. In 2007, in consultation with USCIS, FMS designated the  bank that operates the Chicago lockbox as the financial agent responsible  for all USCIS fee collections. USCIS is in the process of moving fee  collection and other preadjudication processing activities from the service  centers and field offices to lockbox facilities operated by that bank by  March 2011.
Table 2 shows the amount and percentage of regular application fees and  premium processing fees collected by site during fiscal year 2007. During  fiscal year 2008, USCIS collected over $2.4 billion in regular application  fees and premium processing fees for the IEFA.
The fiscal year 2007 fee collections reflect an increase in application fees  that occurred at the end of July 2007 and an increase in the number of  application filings prior to the fee increase date by persons wanting to  avoid higher fees. Application filings also increased because of the  publication of a State Department Visa Bulletin announcing the availability  of employment-based visas. Fees increased by a weighted average of 86  percent per application, based on the fee review completed by USCIS in  February 2007. (See app. II for a list of applications and their related fees.)
USCIS’s prior fee review was completed in November 1996 and resulted in  fee increases that took effect in 1998. Since then, USCIS has increased fees  four times (including the July 2007 increase). Table 3 shows the amount  and basis for those fee increases.
To perform its most recent fee review, USCIS used a commercial off-the- shelf software application to assign the costs of its immigration  application processing and adjudication services. Management’s objective  was to set fees that would recover funds sufficient to cover USCIS’s costs.  USCIS officials told us that when developing the methodology used in the  fee review, management anticipated some skepticism about the fairness of  the resulting fees, so its objectives also included using methods that would  distribute costs among the various application types fairly and in a way  that could be readily understood by fee payers and others.
The data USCIS used for its fee review came from a variety of sources.  Financial data USCIS used were from USCIS’s fiscal year 2007 budget  adjusted for inflation and USCIS estimates of the cost of enhancements  needed to meet its responsibilities. The nonfinancial information USCIS  used included historical data on application completion rates—the  average time it takes to complete adjudication of an application—from its  own Performance Analysis System (PAS) and the number of applications  USCIS estimated it would receive each year in fiscal years 2008 and 2009.
USCIS estimated that the number of applications to be received in fiscal  years 2008 and 2009 would be 5.577 million per year, including  applications for which no fee is charged. Fee-paying application volume  was estimated to be 4.742 million yearly. USCIS also estimated that 2.196  million of the fee-paying applications would require biometric services, for  which an additional fee is charged.
USCIS also estimated the total annual cost of processing and adjudicating  immigration applications for fiscal years 2008 and 2009. USCIS started  with the fiscal year 2007 IEFA budget adjusted for costs that will not recur  after fiscal year 2007, adjusted for inflation for fiscal years 2008 and 2009,  and added the estimated cost of additional requirements USCIS  determined it needed to enhance service, security, and infrastructure.  USCIS’s resulting estimated cost for processing and adjudicating  immigration benefit applications for fiscal years 2008 and 2009 is   $2.329 billion, as shown in table 4.
The additional requirements of $524.3 million, shown in table 4, represent  staff, equipment, training, and other costs that were not previously funded  and that USCIS determined it needed to improve its capabilities to meet its  mission responsibilities. These additional requirements include    service enhancements ($134.8 million), such as staff and training, which  according to USCIS, would provide a small surge production capacity to  give it the flexibility to adapt to temporary increases in filings and the  ability to incrementally work to marginally shorten processing times and  improve service delivery over time;   security and integrity enhancements ($152 million), such as establishing a  second card production facility to support day-to-day production and to  comply with federal standards for contingency planning to ensure that  critical systems remain available in the event of catastrophic failure;    humanitarian program enhancements ($14 million) to fully fund the Cuban  Haitian Entrant Program; and infrastructure enhancements ($223.4 million), such as strengthening  administrative support activities and upgrading and maintaining the  information technology environment to sustain current operations.
As discussed in the next section (see also fig. 1), USCIS classified its total  estimated costs as either direct or overhead. According to USCIS, direct  costs were assigned to field offices or activities based on an identified  relationship between the cost component and the field office or activity.  Overhead costs were allocated to field offices primarily based on the  number of FTEs assigned to each field office. The field office costs along  with their allocated overhead costs were assigned to eight application  processing activities and distributed as shown in table 5.
The activity costs include USCIS-estimated costs for asylum and refugee  services ($191 million), fee waivers and exemptions ($150 million), and  biometric services ($174 million). These costs were allocated to the  applications separately as described below. USCIS assigned the remaining  $1.814 billion of activity costs to the expected 4.742 million fee-paying  applications, resulting in a processing cost for each application type.  USCIS then allocated the costs of asylum and refugee services and fee  waiver and exemptions in equal dollar amounts as surcharges to each  application’s processing cost to arrive at a total cost for each application  type. USCIS set each application fee based on this total cost. The   $174 million of “capture biometrics” activity costs were allocated evenly to  the estimated 2.196 million fee-paying applications, resulting in a separate  and equal biometrics fee for each application that would require biometric  services. (See app. II for a list of applications and fees.) Figure 1 illustrates  the cost assignment process.
section_title: Costing Methodology Did Not Consistently Adhere to Federal Accounting Standards and Principles and Other Guidance
paragraphs: Although the July 2007 fee increases met management’s objective to set  fees at a level to recover USCIS’s estimated costs of immigration  application processing and adjudication services, the costing methodology  USCIS used to develop the fees for each application type did not  consistently adhere to federal accounting standards and principles and  other guidance. While federal accounting standards allow flexibility for  agencies to develop managerial cost accounting practices that are suited  to their specific needs and operating environments, they also provide  certain specific guidance based on sound cost accounting concepts. USCIS  officials told us that when developing the methodology, management  anticipated some skepticism about the fairness of the resulting fees, so its  objectives also included using methods that would distribute costs among  the various application types fairly and in a way that could be readily  understood by fee payers and others.
USCIS’s methodology was not consistent with federal accounting  standards and principles and other guidance in the following aspects:   (1) unreimbursed costs paid by other federal entities on behalf of USCIS  were not included in USCIS’s estimates of total costs, (2) key assumptions  and methods used for allocation of costs to activities and types of  applications were not sufficiently justified, (3) assumptions about staff  time spent on various activities were not supported by documented  rationale or analysis, (4) the cost of premium processing services was not  determined, and (5) documentation of the processes and procedures was  not sufficient to ensure consistent and accurate implementation of the  methodology. Because of these inconsistencies, USCIS cannot support the  reasonableness of the cost assignments to the various application types.
subsections: section_title: Certain Costs Paid by Other Federal Entities Were Not Included in the Fee Review
paragraphs: USCIS did not include the costs of lockbox services paid by Treasury or  certain retirement benefits to be paid by OPM in estimating the full cost of  its immigration application processing and adjudication services. USCIS  officials told us that they only included costs that the agency paid directly,  which met management’s objective to set fees that recover funds sufficient  to cover USCIS’s costs. However according to federal accounting  standards, each entity’s full cost also should incorporate the cost of goods  and services that it receives from other entities free of charge. This is  especially important for executive agencies when the costs constitute  inputs to government goods or services provided to nonfederal entities for  a fee or user charge because executive agencies should recover the full  costs. OMB Circular No. A-25, which provides guidance for executive  agencies on assessment of user charges, states that when not in conflict  with the fee-authorizing statutes, and unless the agency has been granted  an exception to the general policy, fees should be sufficient to recover the  full cost of providing a service, which includes all costs to any part of the  federal government, including accrued retirement costs not covered by  employee contributions and the costs of collection. In other words, costs  should be included regardless of which agency pays them. Congress  authorized, but did not require, USCIS to recover full costs. The document  USCIS prepared to describe its methodology stated that it adhered to the  principles in OMB Circular No. A-25, but in the final rule for the fee  adjustment, USCIS also made clear that its fees would recover only the  costs of USCIS’ operations. Although not inconsistent with the legislation  authorizing the fees, the scope of the costs to be recovered by USCIS, as  announced in USCIS’s final rule, is inconsistent with the general guidance  in OMB Circular No. A-25. USCIS did not document in its final rule, which  it indicated OMB had reviewed, or elsewhere the rationale for excluding  non-USCIS costs from its fee review, including whether or how it  considered the executive branch policy in OMB Circular No. A-25 on  recovering full costs and other factors.
At the time of the fee review, USCIS had not estimated the cost of lockbox  services provided by Treasury’s FMS. At our request, FMS provided  information showing that it compensated two lockbox providers   $20 million for services provided to USCIS in fiscal year 2007. USCIS  included $2 million of these lockbox costs in the estimate of its costs of  immigration application processing and adjudication services. According  to a USCIS official, these costs were related to changes the lockbox  facility had to make to its systems controls, for example, to accommodate  additional data elements required by USCIS in application forms. Although  the $18 million lockbox costs excluded is not a material amount in relation  to the current $2.329 billion total costs estimated by USCIS, this lockbox  cost is expected to grow significantly in the future as USCIS executes its  plan to move the preadjudication processing activities, including fee  collection, from service centers and field offices to lockbox facilities by  March 2011. In fiscal year 2007, approximately 23 percent of fee  collections were at the lockbox facilities, while almost 68 percent were at  service centers.
Legislative authority exists for FMS payment for lockbox services. FMS  pays lockbox costs pursuant to its responsibility for collecting revenues  coming into the federal government and for providing specialized receipt  and disbursement services for federal agencies. FMS officials told us that  federal agencies do not pay for receipting, custody, and disbursement of  federal funds by FMS on the agencies’ behalf because these services are  FMS’s responsibility. According to FMS officials, agencies are to  reimburse FMS only for the costs of services that are considered unique to  that particular agency. USCIS and FMS signed an interagency agreement  in September 2008 that establishes reimbursement levels for onetime and  annual costs that USCIS will pay to FMS. These costs represent the  portion of FMS’s lockbox costs that are unique to USCIS.
In addition, USCIS did not include in its estimated costs of immigration  application processing and adjudication services some of the costs of  retirement benefits—pensions and health and life insurance—to be paid  by OPM on behalf of USCIS. Based on its fiscal year 2007 costs, USCIS  estimated that the average annual projected cost for these benefits for  fiscal years 2008 and 2009 is $47 million before taking into consideration  the agency’s 14 percent increase in the number of employees from May  2007 to May 2008 and 16 percent increase in related payroll costs.
Together, the estimated more than $65 million of FMS and OPM costs  excluded each year represents approximately $14 per fee-paying  application for fiscal years 2008 and 2009. This estimate could differ  among application types if these costs were analyzed more precisely.
Without consideration of these costs paid by other federal entities, USCIS  is not accounting for the full costs to the federal government of USCIS’s  immigration application processing and adjudication services, and USCIS’s  cost data used for setting fees are incomplete.
section_title: USCIS Did Not Sufficiently Justify the Use of Less Precise Cost Assignment Methods
paragraphs: The methodology USCIS used to determine the cost and develop the fees  for each application type involved various assumptions and cost  assignment methods. In large part, it consisted of allocating costs on a  prorated basis. USCIS did not prepare and document analyses to justify its  assumptions that prorated allocations provided a reasonable distribution  of those costs. While federal accounting standards do not prohibit  allocating costs on a prorated basis, they list an order of preference for  three cost assignment methods that should be used: (1) direct tracing of  costs wherever economically feasible, in this case, to an identifiable  office, activity, or application type; (2) assigning costs on a cause-and- effect basis; or (3) allocating costs on a reasonable and consistent basis  when not economically feasible to assign costs directly or on a cause-and- effect basis. The standards also state that the third preference, allocation,  tends to be arbitrary because there may be little correlation between the  costs and the allocation base, and costing distortions often result from  arbitrary allocations. Minimizing arbitrary cost allocations will improve  cost information. Nevertheless, the standards allow flexibility so that  management can select methods that are best suited to the organization’s  needs. The standards also state that when making the selection,  management should evaluate alternative costing methods and select those  that provide the best results under its operating environment.
In the first stage of assigning the estimated $2.329 billion annual  application processing and adjudication services costs for fiscal years 2008  and 2009 (see fig. 1), USCIS officials identified $1.405 billion of direct costs  and $924 million in overhead costs. USCIS considered as overhead the  majority of costs of headquarters functions and some field office functions  and centrally managed costs such as rent and information technology  operations and maintenance. Of the $924 million of overhead costs,   $732 million—31 percent of the total $2.329 billion cost—was allocated to  field offices based on the number of FTEs assigned to each field office.  This approach did not consider USCIS’s approximately 6,100 contract  workers and used only approximately 7,900 FTEs of the total federal FTEs  of about 10,400 as the basis for distributing overhead costs. Excluding the  contract workers from the base could have changed the proportion of  overhead costs assigned to the various field offices which introduces the  potential for an additional significant effect on the allocation of those  costs to activities and application types.
Minimizing arbitrary cost allocations will improve cost information.  Alternatives to USCIS’s FTE-based allocation of overhead to field offices  might have included direct or cause-and-effect assignment. For example,  software licenses for applications used by only a specific office or activity  and training for specific employee groups might have been assigned  directly to offices or activities causing, or driving, each of those costs  rather than allocating all of them in the aggregate with other overhead  costs to all field offices on the basis of FTEs. In addition, other costs, such  as information technology operations, that were attributable to a  particular field office or activity might have been assigned using a cause- and-effect analysis, such as consumption of services, rather than a pro rata  FTE-based allocation.
Federal accounting standards state that allocation should have a  reasonable basis, usually a relevant common denominator. USCIS costs  that cannot be assigned directly or on a cause-and-effect basis to specific  field offices or activities in an economically feasible manner might have an  alternative allocation basis that is more closely related to the attributes of  those specific costs than to FTEs. For example, using payroll for certain  employee benefits or usage for certain information technology costs might  have provided a more accurate or reasonable basis for cost distribution  than an FTE-based allocation. Without performing and documenting  analyses to evaluate such alternatives, USCIS management cannot assure  itself or others that it is using the optimal cost allocation method.
Field office overhead and direct costs were assigned to eight discrete  activities (see table 5) related to processing and adjudicating applications.  (See fig. 1.) The activity costs were then assigned to types of applications.  As part of this process, USCIS assigned 49 percent (or about   $1.143 billion) of total costs to total fee-paying applications based on the  amount of time it took to adjudicate an application, resulting in varying  costs per application type for the adjudication activity. The adjudication  time used as the basis for assigning these activity costs to types of  applications was based on historical data on adjudication time from PAS,  which measures the average time to complete adjudication of each  application based on daily production information input by adjudicators.  Thus, for the “make determination” activity, the more complex types of  applications that take more time to adjudicate were assigned a higher cost,  which resulted in a higher fee. This is consistent with the methodology’s  general premise, which according to USCIS is that the more time spent  adjudicating an application, the higher the fee. These cost assignments  used the federal accounting standards’ preferred methods of cost  assignment.
USCIS assigned the remaining 51 percent (or about $1.186 billion) of its  costs to applications in equal amounts. This type of assignment did not  consider any variation in complexity or processing time between  application types. A USCIS official told us that available production data  for these activities were not sufficiently reliable to use as a basis for  assigning costs to applications. Also, according to USCIS, pro rata  allocation was used because these activities’ costs were not significantly  driven by the complexity of an application type. However, USCIS did not  justify its assumption that these costs were not significantly driven by  complexity of application type.
While recognizing that agency management should select costing methods  that best meet their needs, taking into consideration the costs and benefits  of reasonable alternatives, federal accounting standards recommend  minimizing arbitrary cost assignment methods to help avoid inaccurate  product or service costs. It is not unusual for a costing methodology to  assign some costs using logical and justifiable allocation, especially if  more precise assignment methods are not cost effective. However, for  several significant cost elements, such as those discussed here, USCIS did  not prepare the analysis necessary to demonstrate the reasonableness of  or justification for the costs it allocated to each type of application.  Without documented justification for USCIS’s decisions in using methods  that are less precise than others available, decision makers and fee payers  do not have access to information significant in determining their level of  confidence in the reasonableness of USCIS’s application fees.
section_title: USCIS Did Not Document Its Rationale and Related Analysis to Justify Its Assumptions about Staff Time Spent on Various Activities
paragraphs: USCIS did not document its rationale or any related analysis to justify the  assumptions concerning the amount of time staff spent performing various  activities, which were used to assign field office costs to activities.  Although USCIS prepared a supporting document to describe the  methodology it used, the document did not explain certain key  assumptions and methods used in sufficient detail to justify the  reasonableness of the resulting cost assignments. According to federal  internal control standards, significant events are to be clearly  documented. Significant events can include key decisions about  assumptions and methods underlying the assignment of costs. Also,  federal accounting standards require documentation of all managerial cost  accounting activities, processes, and procedures used to associate costs  with products, services, or activities.
According to USCIS, of the $1.137 billion of direct costs assigned to field  offices, $845 million was assigned to activities based on data from PAS,  which include, among other things, the amount of time adjudicators spend  adjudicating applications. The remaining $292 million of direct field office  costs, nearly 26 percent, was assigned to activities based on management’s  judgment of how much staff time was spent on each activity. For example,  based on discussions with representatives from regions, service centers,  and the Performance Management Branch, USCIS decided to allocate 88  percent of the costs of the immigration information officers at service  centers to the “inform the public” activity and 12 percent to the “make  determination” activity. These discussions, including the input of the  internal experts, and the rationale linking this information and related  analysis with the final cost assignments were not documented. Using the  knowledge of informed experts as the basis for estimating cost  assignments can be a reasonable method when reliable data about the  amount of staff time spent performing various activities or other factors  that drive those costs are not available. However, without clear  documentation of these factors, consideration given to these factors, and  the rationale for cost assignment decisions made using these factors,  USCIS is not able to demonstrate the reasonableness of the resulting cost  assignments.
section_title: Costs of Premium Processing Services Were Not Determined
paragraphs: According to federal accounting standards, Congress and federal  executives need cost information to make decisions about allocating  federal resources, modifying programs, and evaluating program  performance. However, USCIS has not determined the costs of the  accelerated processing services offered through its premium processing  program, which provides for the processing of certain applications within  15 calendar days, rather than the typical 2 months or more processing  time. A business that wishes to hire a foreign national to come to the  United States to work temporarily can pay a voluntary fee of $1,000, in  addition to the regular application fee. By law, these premium processing  fees are to be used to cover the costs of (1) premium processing services  to business customers and (2) infrastructure improvements in the  adjudications and customer service processes. Currently, USCIS is  assigning all premium processing fee collections to its business  transformation program to make long-term improvements to its business  processes and technology. Because USCIS is not using any of the premium  processing fee collections for the accelerated processing efforts, regular  fee-paying applicants could be bearing part of any added cost that might  be associated with processing these applications. According to USCIS  officials, because the $1,000 fee is set by law, and not by USCIS, the fee  was not included in the fee review. Without knowing the cost of its  premium processing services, USCIS management and Congress cannot  determine the extent to which the $1,000 fee would cover the costs of the  agency’s premium processing services and infrastructure improvements.
section_title: Documentation of Processes and Procedures Was Not Sufficient to Ensure Consistent and Accurate Implementation
paragraphs: USCIS described the costing methodology it used for its fee review in a  proposed rule announcing the impending application fee increases and in  a report containing supporting documentation for its fee review, which  was available to the public during the public comment period on the  proposed rule. However, USCIS did not prepare the more detailed  documentation called for in federal accounting standards, which would  allow results to be validated and agency personnel to perform the fee- setting process in a consistent manner. According to federal accounting  standards, all cost accounting processes and procedures should be  documented by a manual, handbook, or guidebook of applicable  accounting operations that provides instructions for procedures and  practices to be followed.
In accordance with management’s objective that the methodology be  readily understood by fee payers and others, the documentation USCIS  prepared for the public was prepared so that a third party could  understand USCIS’s overall approach. However, specific procedures and  information used in the fee review as a basis for assigning costs were not  documented in sufficient detail to allow a knowledgeable person to carry  out or replicate the procedures. For example, documentation of the  multistep process USCIS used to allocate overhead costs to activities did  not include the percentages used to make these allocations. Also,  application completion rates (i.e., the average amount of time to complete  adjudication of an application) were not described in enough detail to  explain how the rates were used to assign adjudication activity costs (i.e.,  “make determination” costs) to the various application types.
Lack of documentation of the processes and procedures makes it difficult  to ensure that the methodology used to determine the costs and fees is  consistent from year to year, especially when there are changes in  personnel. Lack of documentation also makes it difficult to train staff in  consistent and accurate application of the methodology. Further, without  complete documentation reviewed and approved by management, an  independent party, such as an auditor, cannot readily assess major  assumptions and methods used in the process or audit the procedures to  provide accountability and added assurance that the cost system is  consistent with federal accounting standards and other requirements and  statutes.
section_title: Accountability Mechanisms Are in Place to Track Use of Fees, and USCIS Is Taking Steps to Strengthen Control over Collections
paragraphs: USCIS has put accountability mechanisms in place to help ensure that it is  using regular application fee collections and premium processing fee  collections as it intended, and it is taking steps to improve internal control  over collection of fees. USCIS has established unique codes in the  financial system for specific projects, and the OCFO monitors  expenditures of fee collections for those projects. Although USCIS has  controls in place over fee collections, it has identified some weaknesses at  the service centers. USCIS reported that it has taken some actions to  strengthen service center controls in the short term, and that it is in the  process of moving all preadjudication application processing and fee  receipt functions from the service centers and field offices to lockbox  facilities to further strengthen control over collections.
subsections: section_title: Accountability Mechanisms Are in Place to Track Use of Fees Intended for Specific Projects
paragraphs: USCIS has established unique codes in the financial system for its projects,  and according to a USCIS official, the OCFO monitors obligations and  expenditures against those codes to track spending of fee collections from  both regular application fees and premium processing fees. Expenditures  for the additional requirements (staff, equipment, training, etc.)— enhancements that had not been funded previously and that USCIS  determined it needed to improve its capability to meet its  responsibilities—are to be made from regular application fees.  Expenditures for USCIS’s business transformation program, to make long- term improvements to its business processes and technology, come from  premium processing fees.
USCIS has established accountability mechanisms to track expenditures  for the planned enhancements of $524 million. As discussed earlier, the fee  schedule that became effective in July 2007 is based, in part, on USCIS’s  estimated costs for these enhancements. Of the $2.329 billion that USCIS  determined it needed annually to fund the cost of processing and  adjudicating immigration applications for fiscal years 2008 and 2009, over  22 percent (or $524 million) represented additional staff, equipment,  training, and projects included in the planned enhancements. USCIS plans  to use $232 million of that amount for payroll and related costs to hire  about 1,500 additional staff. The remaining $292 million is to be used for  specific projects, such as the establishment of a second card facility and  enhanced delivery of secure documents (permanent residence cards,  employment authorization documents, and travel documents), so that the  United States Postal Service can ensure that they are delivered to the  proper recipients.
USCIS’s OCFO has established unique project codes in the financial  system for specific projects included in the planned enhancements to be  financed from regular application fees. According to a USCIS official, the  amounts that USCIS estimated it would spend on each of the  enhancements were allocated to the applicable individual project codes.  Obligations and expenditures made against those project code allocations  are monitored by OCFO to help ensure that USCIS uses the increased  resources to enhance its processing capabilities. A USCIS official told us  that the status of each nonfinancial aspect of the enhancements, such as  new staff hired and draft statements of work for contracts to be let, is also  tracked and discussed at periodic USCIS management meetings. Some  amounts included in the additional requirements are for items that will not  recur, such as the establishment of a second card facility. The second  facility, according to USCIS, is needed to support day-to-day production  and to be available in the event of catastrophic failure in compliance with  federal standards for contingency planning for critical systems. A USCIS  official told us that any nonrecurring costs included in the current fee  schedule will not be included in the baseline resources for the next fee  review. As of September 30, 2008, USCIS had hired about 1,400 additional  staff and had obligated or expended over $207 million of the planned   $292 million for specific projects included in the enhancements.
USCIS’s OCFO tracks the amount of premium processing fee collections  separately from regular application fee collections so that it can dedicate  premium processing fees to its business transformation program to make  long-term improvements to its business processes and technology. USCIS  has established an expenditure plan for its transformation program that  shows the estimated annual costs of the program through fiscal year 2012.  According to the program’s expenditure plan, USCIS will dedicate all  anticipated premium processing fee collections to the transformation  program for fiscal years 2008 through 2012. A USCIS official told us that  commitments, obligations, and expenditures for transformation projects  are recorded to specific codes in the financial system, and those amounts  are tracked along with premium processing fees. USCIS plans to use the  entire amount of premium processing fees it received in fiscal year 2008— almost $163 million—for its transformation program. During fiscal year  2008, USCIS obligated over $12 million of that amount for the  transformation program. A USCIS official told us that as some planned  transformation projects move closer to the awarding of contracts,  amounts will be allocated to the transformation project codes so  obligations and expenditures can be made for those projects. According to  USCIS, a Transformation Solution Architect Task Order in the amount of  $14.5 million was awarded at the beginning of November 2008.
section_title: USCIS Is Moving Fee Collections to Lockbox Faclities to Strengthen Control over Collections
paragraphs: USCIS has documented and assessed its internal control activities and  processes related to fee collections. Based on our review of USCIS’s  internal control documentation, service center contracts, and independent  auditor reports and our discussions and observations during visits to the  service centers and lockbox facilities, we identified a system of controls  designed to safeguard fees collected. The controls include dual custody of  fee receipts, surveillance cameras in the fee collection areas, and  balancing and reconciling fee collection amounts as an application moves  through processing. Although controls are in place, USCIS has identified  through its monitoring procedures some weaknesses at one of its service  centers. Because of these weaknesses, and for other reasons, such as the  lockbox facility’s flexibility to respond to unanticipated surges in  application receipt volume, USCIS is in the process of moving all  preadjudication application processing and fee receipt functions from the  service centers and field offices to lockbox facilities.
USCIS management assessed the effectiveness of its service centers’  internal controls over collection and depositing of fees in fiscal year 2007  in accordance with OMB Circular No. A-123, Management’s  Responsibility for Internal Control, and found weaknesses, such as fee  receipts not being deposited in a timely manner and applications and fees  being stored in unsecured locations thus creating some security issues.  USCIS reported that these weaknesses resulted in part from the increased  workload attributable to filings by applicants attempting to beat the  proposed fee increases effective in July 2007 and increased application  filings because of the publication of a State Department Visa Bulletin. An  influx of applications and fees exceeded service center capacity to timely  issue receipts and deposit application fees. Applications were kept in  temporary storage containers, or pods, in the parking lot at one service  center and were not being receipted and deposited timely. USCIS has  identified corrective actions, including the transition of fee collections and  preadjudication processing of applications to lockbox facilities, and is in  the process of implementing them. According to USCIS, other corrective  actions were implemented, including physical security improvements such  as installing a barbed wire fence around the perimeter of the area  containing the pods and a security guard to monitor the area 24 hours a  day, 7 days a week.
According to USCIS, at the four service centers, controls related to the fee  collection process may vary, but each location is expected to maintain  policies and procedures in accordance with management’s directives. We  observed certain of these controls in operation at the service centers.  USCIS’s procedures require dual custody of fee receipts at all times. The  procedures also state that after application and check information have  been entered into USCIS’s system, the checks are to be removed from the  applications and placed in the data entry clerk’s locked safe. We observed  the placement of endorsed checks into small safe-type boxes. However, at  one service center, the boxes did not have locks.
Another control at the service centers relates to preparing the daily bank  deposit. USCIS’s procedures require verification of collected fee amounts  at different steps during the process. USCIS and contractor staff at one  service center described the process, and we observed the documentation  that was prepared to support a prior day’s bank deposit. The  documentation included required items such as reconciliations, approvals,  bank deposit slips, and courier signatures acknowledging courier receipt  of the checks for delivery to the bank.
At the lockbox facility we visited, we observed controls such as restricted  access to the entire lockbox operations area, surveillance cameras in the  segregated area where employees open mail and separate checks, and  comparing and balancing the number of applications and amount of fee  collections at each step of the process. An independent auditor reviewed  controls at the lockbox facility and determined that the controls tested  were effective.
USCIS is in the process of moving fee collection and other preadjudication  processing activities to lockbox facilities by March 2011. According to  USCIS, benefits of the lockbox include reduced operational costs, a more  secure environment for fee collections, centralized and expedited  application and fee collection intake, and flexibility to address  unanticipated surges in application receipt volume. For example, the  lockbox facilities maintain a certain number of staff as temporary workers  who can be called upon when needed.
section_title: Conclusions
paragraphs: Application fees are intended to fund USCIS’s immigration benefit  application processing operations and other related services. While USCIS  has met its objective to set fees at a level sufficient to cover its estimated  costs, it has not considered the costs incurred by other federal entities on  USCIS’s behalf when estimating the cost of each type of application and  setting fees. Also, key assumptions and methods for allocating costs to  activities and application types are not sufficiently justified or  documented, and USCIS does not know how the cost of accelerated  processing compares to its $1,000 premium processing fee. Further,  documentation that USCIS prepared to describe its costing methodology  does not provide sufficient instruction for the costing processes and  practices to be followed in determining the costs of each type of  application. USCIS, fee payers, congressional decision makers, and others  need assurance that the costing methodology used to determine the fees  for individual application types provides reliable results and that the  assumptions and assignment methods used are justified. A costing  methodology consistent with federal accounting standards and principles  and other guidance, including complete documentation of the agency’s  cost assignment process and its analysis and justification for key  assumptions used to estimate costs and determine application fees, could  help provide that assurance. To increase confidence that its cost estimates  provide a reliable basis for setting application fees, USCIS would need to  analyze alternate cost assignment methods taking into consideration the  costs and benefits of reasonable alternatives, generating additional  operations and production data, such as information system usage and  preadjudication processing time, to prepare those analyses. USCIS’s  internal control monitoring procedures identified weaknesses in service  center fee collection procedures that USCIS has addressed while planning  the transition of its collection and preadjudicative processing functions to  lockbox facilities.
section_title: Recommendations for Executive Action
paragraphs: To help make USCIS’s costing methodology used for determining  application fees consistent with federal accounting standards and  principles and to strengthen the reliability of the cost assignments used to  set fees, we recommend that the Secretary of Homeland Security direct  the Director of USCIS to take the following four actions:  identify the full cost of application processing services whether paid  directly by USCIS or by other federal entities for USCIS’s benefit, such as  the costs of lockbox services paid by Treasury’s FMS and certain  retirement benefits to be paid to USCIS retirees by OPM;   consider the full costs to the government when USCIS next reviews and  sets application fees and document the rationale for decisions made about  including or excluding any types of costs in the fee determination process;   determine the costs of providing premium processing services to identify  the extent to which the $1,000 premium processing fee would cover  associated expedited processing costs and infrastructure improvements;  and   document the processes and procedures of the costing methodology in  sufficient detail so that the specific procedures used and the data sources  and cost assignment methods employed for each step in the process can  be understood and replicated.
To better support the reasonableness of USCIS’s assumptions and cost  assignment methods, we recommend that the Secretary of Homeland  Security direct the Director of USCIS to take the following two actions:    analyze current cost allocation methods to evaluate whether direct or  cause-and-effect assignment methods that are economically feasible or  other allocation bases may offer greater precision and  fully document the rationale and any related analysis for using the  assumptions and cost assignment methods selected.
section_title: Agency Comments and Our Evaluation
paragraphs: In written comments on a draft of this report, DHS and USCIS concurred  with our recommendations and reported that related actions are planned  or underway. These actions, if properly implemented, should better  support the reasonableness of USCIS’s assumptions and cost assignment  methods and help strengthen the reliability of the cost assignments used to  set fees.
DHS characterized the issues raised in the draft report as mostly  pertaining to documentation and analysis supporting discrete decisions by  USCIS in developing its costing methodology. In this regard, DHS  indicated that USCIS had substantial documentation supporting its costing  methodology. As discussed in the draft report, it will also be important  that available documentation and analysis is sufficient to explain the  methodology to potential users, provide justification for key assumptions,  and guide future program administrators in preparing future fee reviews  using a consistent methodology. This level of documentation and analysis  is critical to developing reliable cost information for management of fee- based programs on an ongoing basis.
We are sending copies of this report to interested congressional  committees, the Secretary of Homeland Security, the Acting Deputy  Director of USCIS, the Inspector General of DHS, and other interested  parties. This report is also available at no charge on the GAO Web site at  http://www.gao.gov.
Should you or your staff have any questions about this report, please  contact Jeanette Franzel at (202) 512-9406 or franzelj@gao.gov or Susan J.  Irving at (202) 512-8288 or irvings@gao.gov. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. GAO staff who made major contributions to this report  are listed in appendix V.
section_title: Appendix I: Scope and Methodology
paragraphs: To assess the consistency of U.S Citizenship and Immigration Services’  (USCIS) costing methodology with federal accounting standards and  principles, including whether USCIS sufficiently justified and documented  its assumptions and methods, we reviewed federal accounting standards  and Office of Management and Budget (OMB) guidance on user fees. We  also reviewed USCIS documents related to the fee review and its  methodology. We obtained further understanding of the methodology  through interviews with knowledgeable USCIS officials and staff. We  reviewed the design and operation of USCIS’s cost system, its  accumulation methods, and the assignment of costs involved in processing  and adjudicating immigration applications. We performed a walk-through  of the cost system, discussed key assumptions and decisions with USCIS  officials, and performed analytical reviews. For example, we performed  calculations to verify USCIS’s distribution of overhead costs. We reviewed  USCIS documents describing the bases on which USCIS assigned costs to  its processing activities and how individual application fees were  determined. To determine whether USCIS data were sufficiently reliable  for purposes of this report, we discussed data quality control procedures  with agency officials and reviewed relevant documentation.
To identify and assess the accountability mechanisms and internal  controls that USCIS has in place over the collection and use of fees, we  reviewed internal control standards and relevant USCIS documentation,  and we interviewed knowledgeable USCIS officials and staff about the  controls USCIS has put in place. We corroborated information obtained in  the interviews by reviewing contracts for service center support  operations, USCIS internal control documentation, and an independent  auditor’s report on controls in place at the lockbox facility and through  our visits to four USCIS service centers in California, Nebraska, Texas, and  Vermont and a lockbox facility in Chicago. During those visits, we  interviewed officials and staff and observed the fee collection process.  Regarding controls over use of fees, we discussed with USCIS officials and  staff the processes for tracking and monitoring fee collections and related  expenditures. We corroborated the information obtained in the  discussions by reviewing USCIS reports showing the amount of fee  collections received, and we verified that related obligations and  expenditures were made against the specific project codes system for  selected projects.
We conducted this performance audit from October 2007 through January  2009 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: Immigration Application Forms and Related Fees Prior to and as of the July 30, 2007, Fee Increase
paragraphs: Petition to Remove Conditions on Residence  Application for Family Unity Benefits  Application for Temporary Protected Status (first-time  applicants)
Applicants filing forms that require biometrics services must pay a fee of $80 in addition to the  regular application fee.
section_title: Appendix III: Federal Statutes, Accounting Standards and Principles Related to Cost Accounting and User Fees, and Other Guidance
paragraphs: The Federal Financial Management Improvement Act of 1996 (FFMIA)  requires, among other things, that agencies covered by the Chief Financial  Officers (CFO) Act have financial management systems that substantially  comply with federal accounting standards. USCIS is part of the  Department of Homeland Security and must conform to the requirements  of the CFO Act. Statement of Federal Financial Accounting Standards No.  4, Managerial Cost Accounting Standards and Concepts, sets forth the  fundamental elements of managerial cost accounting. Cost information  can be used by federal managers for budgeting and cost control,  performance measurement, program evaluations, making economic choice  decisions, and determining and setting fees. The standards provide  guidance on allocating costs to products and services provided by federal  agencies. The standards do not impose a specific methodology on federal  agencies but allow flexibility to design a cost accounting system that  meets the specific needs of each agency. Among other things, the CFO Act  requires agencies to review fees imposed by them on a biennial basis.
OMB Circular No. A-25, User Charges, contains federal policy regarding  fees assessed for government services and provides information on the  basis upon which user charges (i.e., fees) are to be set. OMB Circular No.  A-25 provisions apply to agencies in their assessment of user charges  under 31 U.S.C. § 9701 (the user fee statute). It provides that when a  service or privilege confers special benefits to an identifiable recipient  beyond those that accrue to the general public, a charge will be imposed  to recover the full cost to the federal government for providing the special  benefit. Full costs, according to OMB Circular No. A-25, include all direct  and indirect costs of providing the service. OMB Circular No. A-25 also  provides guidance to agencies regarding their assessment of user charges  under other statutes, such as 8 U.S.C. 1356(m) to the extent OMB Circular  No. A-25 is not inconsistent with those other statutes.
The Comptroller General’s Standards for Internal Control in the Federal  Government provides an overall framework for establishing and  maintaining internal control. Management is responsible for establishing  and maintaining internal control to achieve the objectives of effective and  efficient operations. OMB Circular No. A-123, Management’s  Responsibility for Internal Control, defines management’s responsibility  for internal control in federal agencies and provides guidance to federal  managers on improving the accountability and effectiveness of federal  programs and operations by establishing, assessing, correcting, and  reporting on internal control.
section_title: Appendix IV: Comments from the Department of Homeland Security
section_title: Appendix V: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Acknowledgments
paragraphs: In addition to the contacts named above, staff members who made key  contributions to this report include Jack Warner, Assistant Director;  Richard Cambosos; Abe Dymond; Emily Eischen; Fred Evans; P. Barry  Grinnell; Chelsa Gurkin; Maxine Hattery; Jason Kelly; Diane Morris;  Jacqueline Nowicki; Leah Probst; and Nathan Tranquilli.