The IG Act created independent IG offices at 30 major departments and agencies with IGs appointed by the President, confirmed by the Senate, and who may be removed only by the President with advance notice to the Congress stating the reasons. (A listing of these 30 departments and agencies with presidential IG offices is provided in app. I.) In 1988, the IG Act was amended to establish additional IG offices located in 33 DFEs defined by the act. (A listing of the DFEs with IGs is provided in app. II.) Generally, the DFE IGs have the same authorities and responsibilities as those IGs originally established by the IG Act, but with the distinction that they are appointed and may be removed by their agency heads rather than by the President and are not subject to Senate confirmation. Although not in the scope of our review, there are 10 IGs established by other statutes with provisions similar to those in the IG Act. (A listing of the IGs established under other statutes is provided in app. III.) The IGs appointed by the President are generally located in the largest departments and agencies of the government; the DFEs have smaller budgets and their IGs have correspondingly smaller budgets and fewer staff. The presidentially appointed IGs and the DFE IGs reported to us total budget authority for fiscal year 2010 of about $2.2 billion with approximately 13,652 authorized full-time equivalent staff and 13,390 staff on board at the end of fiscal year 2010. The presidentially appointed IGs’ budget authority constituted about 84 percent (about $1.8 billion) of the total, and they had about 86 percent (11,564) of the total staff on board. The budgets of the DFE IGs made up about 16 percent (about $352 million) of the total budget authority for IGs, and they had about 14 percent (1,826) of the total staff on board at the end of fiscal year 2010. The IG Reform Act of 2008 (Reform Act) amended the IG Act by adding requirements related to IG independence and effectiveness. Among other provisions, the Reform Act requires the rate of basic pay of the IGs appointed by the President to be at a specified level, and for the DFE IGs, at or above a majority of other senior-level executives at their entities. The Reform Act also requires an IG to obtain legal advice from his or her own counsel or to obtain counsel from another IG’s office or from the Council of the Inspectors General on Integrity and Efficiency (IG Council). The IG Act also provides protections to the independence of the IGs while keeping both their agency heads and the Congress fully and currently informed about particularly flagrant problems and deficiencies within their agencies through a 7-day process specified by the act. In addition, the Dodd-Frank Act amended the IG Act with provisions to enhance the independence of IGs in DFEs with boards or commissions. Specifically, the Dodd-Frank Act changed who would be considered the head of the DFE for purposes of IG appointment, general supervision, and reporting under the IG Act. If the DFE has a board or commission the amendments would now require each of these IGs to report organizationally to the entire board or commission as the head of the DFE rather than an individual chairman. In addition, the Dodd-Frank Act requires the written concurrence of a two-thirds majority of the board or commission to remove an IG. Prior to this protection, most DFE IGs reported to, and were subject to removal by, the individual serving as head of the DFE. The Reform Act also included a provision intended to provide additional IG independence through the transparent reporting of their budgets. Specifically, the Reform Act requires the President’s budget submission to the Congress to have the IGs’ requested budget amounts identified separately within their respective agency budgets, along with any comments provided by the IGs on the sufficiency of their budgets. The American Recovery and Reinvestment Act of 2009 (Recovery Act) is one of the federal government’s key efforts to stimulate the economy in response to the most serious economic crisis since the Great Depression. The Recovery Act provided for IG oversight of the funds by creating the Recovery Accountability and Transparency Board (Recovery Board), which has an IG Chairman and 12 additional IG board members to prevent and detect fraud, waste, and abuse in the stimulus-funded programs. Altogether, there are 30 IGs involved with the oversight of Recovery Act funds. (A listing of the IGs providing oversight of Recovery Act funds is provided in app. IV). Also, the IG Act includes a provision addressing the qualifications and expertise of the IGs by specifying that each IG appointment is to be without regard to political affiliation and solely on the basis of integrity and demonstrated ability in accounting, auditing, financial analysis, law, management analysis, public administration, or investigation. The fields in which an IG can have experience are intended to be sufficiently diverse so that many qualified people could be considered, but also limited to areas relevant to the tasks considered necessary. The IG Act Amendments of 1988 created DFE IGs but did not specify that these IG appointments made by agency heads were to be without regard to political affiliation and on the basis of demonstrated ability in specified fields. The Reform Act addressed the differences in criteria for IG appointment by providing the same provisions for both the DFE IGs and the IGs appointed by the President. We addressed our reporting objectives through our summary of responses to a survey sent to the federal statutory IGs established by the IG Act regarding their activities for fiscal year 2010, and additional analysis. We obtained and analyzed survey responses from 62 IGs established by the IG Act: including 30 IGs who were appointed by the President and confirmed by the Senate, and 32 DFE IGs. We augmented the survey data with information obtained from prior GAO reports, the President’s budget submission to the Congress for fiscal year 2011, and the IGs’ semiannual reports to the Congress. For our discussion of the independence of the IGs, we summarized information from the responses to our survey questions about the implementation of selected provisions in the Reform Act, the IG Act, and the Dodd-Frank Act that are intended to enhance IG independence. Specifically, we asked all of the 62 IGs about the implementation of Reform Act provisions intended to keep IG pay and salaries at a specified level for IGs appointed by the President and consistent with other senior- level executives for the DFE IGs, and about the IGs’ sources of legal counsel. Our survey also obtained information about the extent to which the IGs found it necessary to communicate particularly flagrant problems to their agency heads and the Congress within 7 days as prescribed by the IG Act. These IG reports are commonly referred to as 7-day letters. Regarding the effect of Dodd-Frank Act provisions to enhance independence, we obtained the views of the 26 DFE IGs with boards or commissions on whether their independence was enhanced by these provisions designating their boards and commissions as DFE heads rather than individual chairmen, and the requirement for the concurrence of a two-thirds majority of the board or commission for removal of an IG. We also obtained information from the President’s budget submission to the Congress for fiscal year 2011, to determine whether the IG budget amounts were separately identified along with any comments by the IGs regarding the sufficiency of their budgets. To address the effectiveness of the IGs, we obtained information on the accomplishments of the IGs as reported to the IG Council for fiscal year 2009, in preparation for their annual report to the President. We also obtained information reported by the Recovery Board on its mission and accomplishments in providing oversight of Recovery Act funds. In addition, our survey questionnaire obtained information for fiscal year 2010 on management challenges identified by the IGs reporting under requirements of the Reports Consolidation Act of 2000. To identify the extent of oversight provided by the IGs, we summarized the reported management challenges to identify the major focus of these issues and obtained IG reports relevant to these issues provided by the IGs to our survey and from our review of the IGs’ semiannual reports to the Congress. To address the IGs’ qualifications and expertise we summarized the 62 IGs’ survey information provided on the background of each IG, including professional experience, academic degrees, and professional certifications obtained prior to being appointed to an IG position. We compared this information to the areas of demonstrated ability specified by the IG Act and summarized the number of IGs in each area. We conducted our work from November 2010 to September 2011 in accordance with all sections of GAO’s Quality Assurance Framework that are relevant to our objectives. The framework requires that we plan and perform the engagement to obtain sufficient and appropriate evidence to meet our stated objectives and to discuss any limitations in our work. We believe that the information and data obtained, and the analysis conducted, provide a reasonable basis for any findings and conclusions. We requested comments on a draft of this report from the IG Council. Written comments from the IG Council are reprinted in appendix V and summarized in the “Agency Comments” section of this report. We also received and incorporated as appropriate technical comments from several IG offices. Our survey obtained information from 62 federal IGs appointed under the IG Act on actions taken concerning legislative provisions in the Reform Act and the IG Act intended to enhance IG independence.