Federal Housing Finance Agency Office of Inspector General: Improvements Needed in Review Procedures for Payroll Accounting
| Report Type |
Reports and Testimonies |
| Report Date |
May 9, 2024 |
| Release Date |
May 9, 2024 |
| Report No. |
GAO-24-107430 |
Summary:
What GAO Found
During its audits of the Federal Housing Finance Agency's (FHFA) fiscal year 2023 consolidated financial statements, GAO identified deficiencies in the FHFA Office of Inspector General's (OIG) internal controls. Although these control deficiencies did not negatively affect GAO's overall audit opinion on FHFA's consolidated financial statements or internal controls over financial reporting, they nonetheless warrant the attention of FHFA OIG management.
Of the control deficiencies it identified, GAO considered one—which was related to the accuracy of FHFA OIG's payroll accruals—to be a significant deficiency when combined with a related FHFA control deficiency. GAO identified another less-critical deficiency related to FHFA OIG's not properly identifying unexplained variances above its $1.5 million threshold for quarterly reconciliations. By addressing these deficiencies, FHFA OIG can make it more likely that agency management and employees will prevent, or detect and correct, misstatements in financial reporting.
Why GAO Did This Study
In November 2023, GAO reported on the results of its audits of FHFA's consolidated financial statements for fiscal years 2023 and 2022. Although GAO found that FHFA had maintained effective internal control over financial reporting as of September 30, 2023, GAO did identify some deficiencies in FHFA OIG's internal controls. The purpose of this report is to present the internal control deficiencies GAO identified during its fiscal year 2023 audit.
To evaluate FHFA OIG's internal control over financial reporting, GAO reviewed FHFA OIG's policies and procedures; interviewed FHFA OIG management and staff; observed controls in operation; and conducted tests of controls to determine whether controls were designed, implemented, and operating effectively.
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