Financial Audit: Independent and Special Counsel Expenditures for
the Six Months Ended September 30, 2000 (30-MAR-01, GAO-01-505).
This report presents the results of GAO's audits of expenditures
reported by six offices of independent counsel and one office of
special counsel for the six months ending September 30, 2000. GAO
found the statements of expenditures for the offices of
independent counsel and office of special counsel were presented
fairly in all material respects. There were no material
weaknesses in internal control over financial reporting
(including safeguarding of assets) and no reportable
noncompliance with the laws and regulations GAO tested.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-01-505
ACCNO: A00700
TITLE: Financial Audit: Independent and Special Counsel
Expenditures for the Six Months Ended September 30, 2000
DATE: 03/30/2001
SUBJECT: Auditing standards
Financial management systems
Financial statement audits
Independent counsels
Internal controls
Reporting requirements
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GAO-01-505
A
Report to Congressional Committees
March 2001 FINANCIAL AUDIT Independent and Special Counsel Expenditures for
the Six Months Ended September 30, 2000
GAO- 01- 505
Lett er
March 30, 2001 Congressional Committees Enclosed is our report on the
statements of expenditures of six offices of independent counsel and one
office of special counsel for the 6 months ended September 30, 2000. We are
sending copies of this report to the
Attorney General, the Director of the Administrative Office of the U. S.
Courts, the independent counsels and special counsel included in our audit,
and other interested parties. Copies will be made available to others upon
request. This report was prepared under the direction of Jeanette M.
Franzel, Acting Director, Financial Management and Assurance, who can be
reached at (202) 512- 9406. If I can be of further assistance, please call
me at (202) 512-
2600. Jeffrey C. Steinhoff Managing Director Financial Management and
Assurance
Congressional Committees This report presents the results of our audits of
expenditures 1 reported by six offices of independent counsel and one office
of special counsel for the 6 months ended September 30, 2000. The Department
of Justice and the independent counsels are required under 28 U. S. C. 594(
d)( 2), (h), and 596( c)( 1) (1994) to report on expenditures from a
permanent, indefinite appropriation established within the Department of
Justice to fund independent counsel activities. We are required under 28 U.
S. C. 596( c)( 2), to audit the statements of expenditures prepared by the
independent counsels. We also audited the statement of expenditures of
Special Counsel John C. Danforth, who is authorized by the Department of
Justice to fund
his operations from the permanent, indefinite appropriation. In our audits
covering the 6 months ended September 30, 2000, we found
? the statements of expenditures presented in appendixes I through VII, for
the offices of independent counsel David M. Barrett, Carol Elder Bruce,
Ralph I. Lancaster, Daniel S. Pearson, Robert W. Ray, and Donald C. Smaltz,
and special counsel John C. Danforth, respectively, were presented fairly in
all material respects, in conformity with the
basis of accounting described in note 1 of each counsel's statement, which
is principally the cash basis, a comprehensive basis of accounting other
than U. S. generally accepted accounting principles;
? no material weaknesses in internal control over financial reporting
(including safeguarding of assets) and compliance with laws and regulations
and its operation; and
? no reportable noncompliance with the laws and regulations we tested. The
following sections provide background information, outline each conclusion
in more detail, and discuss the scope of our audits.
Background The Ethics in Government Act of 1978 amended title 28 of the
United States Code to authorize the judicial appointment of independent
counsels when the Attorney General determines that reasonable grounds exist
to warrant further investigation of high- ranking government officials for
certain alleged crimes. The independent counsel law (28 U. S. C. 591- 599
(1994)) 1 The term expenditures as used in this report generally means cash
disbursed.
was intended to preserve and promote the accountability and integrity of
public officials and of the institutions of the federal government. The
independent counsel law expired on June 30, 1999. Provisions of the law
allow the independent counsels serving at the expiration date to continue
investigating pending matters until they determine that the investigations
of such matters have been completed. Also, the Department of Justice
determined that the appropriation established by Public Law 100- 202 to fund
expenditures by independent counsels appointed pursuant to 28
U. S. C. 591- 599, or other law, is available to fund the expenditures of
John C. Danforth, who was appointed as a Special Counsel within the
Department of Justice by the Attorney General.
The independent counsel law directs the Department of Justice to pay all
costs relating to the establishment and operation of independent counsel
offices from the permanent, indefinite appropriation established to fund
independent counsel activities. The independent counsel law also designates
specific responsibilities to the Administrative Office of the U. S. Courts
(AOUSC) for independent counsels' administrative support. The Department of
Justice periodically disburses lump- sum payments to AOUSC for this purpose.
During any 6- month period, there may be other significant costs incurred in
support of the work of the counsels, which are paid from appropriations
other than the permanent, indefinite appropriation established to fund
independent counsel activities. These costs arise when a counsel uses
detailees from other federal agencies, such as the Federal Bureau of
Investigation (FBI). Independent counsels are not required to reflect such
costs in their statements of expenditures and neither the independent
counsels nor special counsel do so. However, to the extent practicable the
counsels identified and disclosed these costs in the notes to their
statements presented in the appendixes to this report. These statements and
related notes do not include certain expenditures related to the
investigation by independent counsel Arlin M. Adams/ Larry D. Thompson's
office, which officially terminated effective June 3, 1999 and, accordingly,
no longer prepares financial statements. However, transactions for Office of
Independent Counsel (OIC)- Adams/ Thompson during this period included a
$28,000 refund from a contractor who had provided archiving of investigative
records whose services were no longer required and $20, 400 in expenditures,
resulting in a net $7,600 decrease in OIC- Adams/ Thompson's total
expenditures. Independent Counsel Larry D.
Thompson terminated his appointment on July 30, 2000.
Opinion on Statements The statements of expenditures including the
accompanying notes for the of Expenditures
offices of independent counsel David M. Barrett, Carol Elder Bruce, Ralph I.
Lancaster, Daniel S. Pearson, Robert W. Ray, and Donald C. Smaltz, and for
the office of special counsel John C. Danforth present fairly, in all
material respects, the expenditures of these counsels for the 6 months ended
September 30, 2000, on the basis of accounting described in note 1 to each
office's statement.
The counsels prepared their statements of expenditures principally on a cash
basis of accounting, which is a comprehensive basis of accounting other than
U. S. generally accepted accounting principles. The bases of accounting are
described in note 1 of each counsel's statement.
Consideration of We do not express an opinion on internal control over
financial reporting
Internal Control and compliance because the purpose of our consideration of
internal control was to determine our procedures for auditing the statements
of expenditures, not to express an opinion on internal control. However, for
the controls we tested, we found no material weaknesses in internal control
over financial reporting (including safeguarding assets) and over
compliance with laws and regulations for the 6- month period ended September
30, 2000. A material weakness is a condition in which the design or
operation of one or more of the internal control components does not reduce
to a relatively low level the risk that errors, fraud, or noncompliance in
amounts that would be material in relation to the financial statements being
audited may occur and not be detected promptly by employees in the normal
course of performing their duties. Our internal control work would
not necessarily identify all material weaknesses. Compliance With Laws Our
tests for compliance with selected provisions of laws and regulations and
Regulations
disclosed no instances of noncompliance that would be reportable under U. S.
generally accepted government auditing standards. However, the objective of
our audit was not to provide an opinion on overall compliance with laws and
regulations. Accordingly, we do not express such an opinion.
Objectives, Scope, and The independent counsels are responsible for
preparing statements of
Methodology expenditures in conformity with the bases of accounting
described in the
accompanying notes. Though not required to do so, the special counsel also
elected to prepare a statement of expenditures. The counsels are also
responsible for establishing, maintaining, and assessing internal control to
provide reasonable assurance that the following internal control objectives
are met and for complying with applicable laws and regulations.
? Financial reporting: Transactions are properly recorded, processed, and
summarized to permit the preparation of the statements of expenditures in
conformity with the basis of accounting described in the notes to their
statements, and assets are safeguarded against loss from unauthorized
acquisition, use, or disposition.
? Compliance with laws and regulations: Transactions are executed in
accordance with laws governing the use of budget authority and with other
laws and regulations that could have a direct and material effect on the
counsels' statements of expenditures. We are responsible for (1) obtaining
reasonable assurance about whether the counsels' statements of expenditures
are presented fairly, in all material respects, in conformity with the basis
of accounting described in the notes
accompanying their statements of expenditures, (2) obtaining a sufficient
understanding of internal control over financial reporting and over
compliance with laws and regulations to plan the audits, and (3) testing
compliance with selected provisions of laws and regulations that have a
direct and material effect on the statements. In order to fulfill these
responsibilities, for each counsel, we (1) examined,
on a test basis, evidence supporting the amounts and disclosures in the
statement of expenditures, except for items indicated as unaudited, (2)
assessed the accounting principles used by management, (3) evaluated the
overall presentation of the statement of expenditures, (4) obtained an
understanding of internal control related to financial reporting (including
safeguarding assets) and compliance with laws and regulations (including
execution of transactions in accordance with budget authority), and (5)
tested compliance with selected provisions of 28 U. S. C. 591- 599 (1994), 5
U. S. C. Chapter 55, and regulations relating to pay administration.
We limited our internal control testing to controls over financial reporting
and over compliance with laws and regulations. Because of inherent
limitations in internal control, misstatements due to error, fraud, losses,
or noncompliance may nevertheless occur and not be detected. We also caution
that projecting our evaluation to future periods is subject to the
risk that controls may become inadequate because of changes in conditions or
that the degree of compliance with controls may deteriorate. In addition,
we caution that our internal control testing may not be sufficient for other
purposes.
We did not test compliance with all laws and regulations applicable to the
offices of independent and special counsel. We limited our tests of
compliance to those laws and regulations that we deemed applicable to the
statements of expenditures. We caution that noncompliance may occur and
not be detected by these tests and that such testing may not be sufficient
for other purposes.
We obtained, but did not audit, information on costs that were not paid from
the permanent, indefinite appropriation as well as information on receipts.
We obtained information on these costs and receipts from the independent and
special counsel offices; the Department of Justice, including the FBI; the
Department of the Treasury; and the U. S. Postal Service.
We performed our audits from October 25, 2000 through March 9, 2001, in
accordance with U. S. generally accepted government auditing standards.
Agency Comments and We provided drafts of this report to the six offices of
independent counsel, Our Evaluation
the office of the special counsel, the Department of Justice, and AOUSC for
review and comment. The agency officials agreed with the facts and
conclusions in our report.
Jeffrey C. Steinhoff Managing Director Financial Management and Assurance
March 9, 2001
List of Committees
The Honorable Ted Stevens Chairman The Honorable Robert C. Byrd Ranking
Member Committee on Appropriations United States Senate
The Honorable Fred Thompson Chairman The Honorable Joseph I. Lieberman
Ranking Member Committee on Governmental Affairs United States Senate
The Honorable Orrin G. Hatch Chairman The Honorable Patrick J. Leahy Ranking
Member Committee on the Judiciary United States Senate
The Honorable C. W. Bill Young Chairman The Honorable David R. Obey Ranking
Minority Member Committee on Appropriations House of Representatives
The Honorable Dan Burton Chairman The Honorable Henry A. Waxman Ranking
Minority Member Committee on Government Reform House of Representatives
The Honorable James F. Sensenbrenner Chairman The Honorable John Conyers,
Jr. Ranking Minority Member Committee on the Judiciary House of
Representatives
Appendi xes Statement of Expenditures for Independent
Appendi x I
Counsel Barrett DAVID M. BARRETT Office of Independent Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$647,181 Travel (note 2)
55,821 Rent, communications, and utilities (note 3)
245,275 Contractual services (note 4)
93,385 Acquisition of capital assets
2,651 Supplies and materials
10,010 Administrative services (note 5)
90,665 Total expenditures $1,144,988
____________________________________________________
The accompanying notes are an integral part of this statement.
DAVID M. BARRETT Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies Reporting entity: The accompanying statement of
expenditures presents the expenditures of the Office of Independent Counsel-
David M. Barrett (OICBarrett) for the 6 months ended September 30, 2000. The
statement of expenditures includes only expenditures made from the
permanent, indefinite appropriation for the office of independent counsel
that are processed through the Administrative Office of the U. S. Courts
(AOUSC) and the OIC. Mr. Barrett was appointed on May 24, 1995, to
investigate certain allegations against the Secretary of Housing and Urban
Development.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel Travel generally includes expenditures for investigation-
related travel paid for OIC- Barrett personnel and witnesses.
Note 3 - Rent, communications, and utilities Approximately $174,000 in
office rent is included in rent, communications, and utilities.
Note 4 - Contractual services Contractual services primarily consist of
expenditures for investigators and court reporters.
Note 5 - Administrative services AOUSC receives an administrative fee equal
to 3 percent of OIC expenditures for performing disbursement and accounting
functions for OIC- Barrett. Payment
of these fees generally occurs in the month following the services. Also
included in administrative services are other costs, amounting to $57,890,
incurred by AOUSC in providing administrative guidance and support to
independent counsel offices. These costs were certified by AOUSC, paid from
the independent counsel appropriation, and allocated to the OIC.
Statement of Expenditures for Independent
Appendi x II
Counsel Bruce CAROL ELDER BRUCE Office of Independent Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$241,778 Travel (note 2)
2,552 Rent, communications, and utilities (note 3)
18,266 Contractual services (note 4)
35,864 Supplies and materials
1,401 Administrative services (note 5)
31,600 Total expenditures $331,461
____________________________________________________
The accompanying notes are an integral part of this statement.
CAROL ELDER BRUCE Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies Reporting entity: The accompanying statement of
expenditures presents the expenditures of the Office of Independent Counsel-
Carol Elder Bruce (OICBruce) for the 6 months ended September 30, 2000. The
statement of expenditures includes only expenditures made from the
permanent, indefinite appropriation for the office of independent counsel
that are processed through the Administrative Office of the U. S. Courts
(AOUSC) and the OIC. Ms. Bruce was appointed on March 19, 1998, to
investigate whether the Secretary of the Interior may have violated federal
criminal law in sworn testimony before a congressional committee. Ms. Bruce
submitted her final report to the Special Division of the U. S. Court of
Appeals for the District of Columbia Circuit on December 30, 1999.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel Travel generally includes expenditures for investigation-
related travel paid for OIC- Bruce personnel.
Note 3 - Rent, communications, and utilities Approximately $14,000 in office
rent was refunded by the General Services Administration and is included in
rent, communications, and utilities.
Note 4 - Contractual services Contractual services primarily consist of
payments for specialists to assist in writing the final report.
Note 5 - Administrative services AOUSC receives an administrative fee equal
to 3 percent of OIC expenditures for performing disbursement and accounting
functions for OIC- Bruce. Payment of these fees generally occurs in the
month following the services. Also included in administrative services are
other costs, amounting to $21,159, incurred by AOUSC in providing
administrative guidance and support to independent counsel offices. These
costs were certified by AOUSC, paid from the independent counsel
appropriation, and allocated to the OIC.
Statement of Expenditures for Independent
Appendi x II I Counsel Lancaster RALPH I. LANCASTER Office of Independent
Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$340,453 Travel (note 2)
13,769 Rent, communications, and utilities (note 3)
153,062 Contractual services (note 4)
77,868 Acquisition of capital assets (note 5)
11,058 Supplies and materials
2,119 Administrative services (note 6)
64,274 Total expenditures $662,603
____________________________________________________
The accompanying notes are an integral part of this statement.
RALPH I. LANCASTER Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies Reporting entity: The accompanying statement of
expenditures presents the expenditures of the Office of Independent Counsel-
Ralph I. Lancaster (OICLancaster) for the 6 months ended September 30, 2000.
The statement of expenditures includes only expenditures made from the
permanent, indefinite appropriation for the office of independent counsel
that are processed through the Administrative Office of the U. S. Courts
(AOUSC) and the OIC. Mr. Lancaster was appointed on May 26, 1998, to
investigate activities of the Secretary of Labor regarding a possible
undisclosed financial interest in a company and the solicitation of illegal
campaign contributions.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel Travel generally includes expenditures for investigation-
related travel paid for OIC- Lancaster personnel.
Note 3 - Rent, communications, and utilities Approximately $131,000 in
office rent is included in rent, communications, and utilities.
Note 4 - Contractual services Contractual services represent expenditures
for services of experts and other specialists in areas of interest to the
investigation.
Note 5 - Acquisition of capital assets The capital assets expenditures are
principally for the purchase of a telephone system. These assets will remain
the property of the federal government at the conclusion of the
investigation.
Note 6 - Administrative services AOUSC receives an administrative fee equal
to 3 percent of OIC expenditures for performing disbursement and accounting
functions for OIC- Lancaster. Payment of these fees generally occurs in the
month following the services. Also included in administrative services are
other costs, amounting to $27,556, incurred by AOUSC in providing
administrative guidance and support to independent counsel offices. These
costs were certified by AOUSC, paid from the independent counsel
appropriation, and allocated to the OIC.
Statement of Expenditures for Independent
Appendi x V I Counsel Pearson DANIEL S. PEARSON Office of Independent
Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$34,375 Travel (note 2)
3,548 Rent, communications, and utilities (note 3)
20,361 Contractual services (note 4)
31,935 Supplies and materials
155 Administrative services (note 5)
8,021 Total expenditures $98,395
____________________________________________________
The accompanying notes are an integral part of this statement.
DANIEL S. PEARSON Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies
Reporting entity: The accompanying statement of expenditures presents the
expenditures of the Office of Independent Counsel- Daniel S. Pearson
(OICPearson) for the 6 months ended September 30, 2000. The statement of
expenditures includes only expenditures made from the permanent, indefinite
appropriation for the office of independent counsel that are processed
through the Administrative Office of the U. S. Courts (AOUSC) and the OIC.
Mr. Pearson was appointed on July 6, 1995, to investigate certain
allegations against the Secretary of Commerce. On April 3, 1996, the
Secretary was killed in a plane crash. Shortly thereafter, the independent
counsel closed the investigation of the Secretary and transferred the
investigation related to other parties to the Department of Justice.
Expenditures during this period relate to efforts to archive the
investigative records.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel
Travel generally includes expenditures for investigation- related travel
paid for OIC- Pearson personnel.
Note 3 - Rent, communications, and utilities
Approximately $15,900 in office rent is included in rent, communications,
and utilities.
Note 4 - Contractual services
Contractual services primarily consist of payments to experts in preparing
independent counsel records for archiving.
Note 5 - Administrative services AOUSC receives an administrative fee equal
to 3 percent of OIC expenditures for performing disbursement and accounting
functions for OIC- Pearson. Payment of these fees generally occurs in the
month following the services. Also included in administrative services are
other costs, amounting to $2,091, incurred by AOUSC in providing
administrative guidance and support to independent counsel offices. These
costs were certified by AOUSC, paid from the independent counsel
appropriation, and allocated to the OIC.
Statement of Expenditures for Independent
Appendi x V
Counsel Ray ROBERT W. RAY Office of Independent Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$1,754,930 Travel (note 2)
403,394 Rent, communications, and utilities (note 3)
566,102 Contractual services (note 4)
840,189 Acquisition of capital assets (note 5)
38,982 Supplies and materials
85,048 Administrative services (note 6)
227,303 Total expenditures $3,915,948
____________________________________________________
The accompanying notes are an integral part of this statement.
ROBERT W. RAY Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies
Reporting entity: The accompanying statement of expenditures presents the
expenditures of the Office of Independent Counsel- Robert W. Ray (OIC- Ray)
for the 6 months ended September 30, 2000. The statement of expenditures
includes only expenditures made from the permanent, indefinite appropriation
for the office of independent counsel that are processed through the
Administrative Office of the U. S. Courts (AOUSC) and the OIC.
Kenneth W. Starr (Starr) was appointed on August 5, 1994, to assume the
investigation of possible violations of federal criminal law in Re: Madison
Guaranty Savings and Loan Association and other entities, which was begun by
regulatory Independent Counsel Robert B. Fiske, Jr. The U. S. Court of
Appeals subsequently expanded OIC- Starr's jurisdiction to include selected
White House Travel Office and access- to- personnel- file issues on March
22, 1996, and June 21, 1996, respectively. On October 25, 1996, it further
expanded OIC- Starr's jurisdiction to include issues related to statements
made before the Government Reform and Oversight Committee, U. S. House of
Representatives, on June 26, 1996. On January 16, 1998, the Court expanded
OIC- Starr's jurisdiction to include issues related to whether, in a civil
case, certain individuals suborned perjury, obstructed justice, intimidated
witnesses, or otherwise violated federal law in dealing with witnesses,
potential witnesses, attorneys, or others.
On October 18, 1999, Mr. Starr resigned his appointment, and was succeeded
by Robert W. Ray as independent counsel effective the same date. On March
16, 2000, Mr. Ray submitted to the Special Division of the U. S. Court of
Appeals for the District of Columbia Circuit two final reports on (1) the
access- topersonnel- files issues and (2) the issues related to statements
made before the Government Reform and Oversight Committee. On July 28, 2000,
the Court ordered the public release of the two reports. Further, on June
22, 2000, Mr. Ray submitted to the Court a final report on the White House
travel matter. On October 18, 2000, the Court ordered the public release of
that report. On January 19, 2001, Mr. Ray announced the conclusion of all
current matters before the office of independent counsel.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel
Travel generally includes expenditures for investigation- related travel
paid for OIC- Ray personnel, detailees from other federal agencies, such as
the Federal Bureau of Investigation (FBI), contractors, and witnesses.
Note 3 - Rent, communications, and utilities
Approximately $390,000 in office rent is included in rent, communications,
and utilities.
Note 4 - Contractual services
Contractual services primarily consist of expenditures for computer support
and maintenance and investigators and other specialists in areas of interest
to the investigation.
Note 5 - Acquisition of capital assets
The capital assets expenditures are primarily for automated data processing
equipment. These assets will remain the property of the federal government
at the conclusion of the investigation.
Note 6 - Administrative services
AOUSC receives an administrative fee equal to 3 percent of OIC expenditures
for performing disbursement and accounting functions for OIC- Ray. Payment
of these fees generally occurs in the month following the services. Also
included in administrative services are other costs, amounting to $122, 664,
incurred by AOUSC in providing administrative guidance and support to
independent counsel offices. These costs were certified by AOUSC, paid from
the independent counsel appropriation, and allocated to the OIC.
Statement of Expenditures for Independent
Appendi x VI
Counsel Smaltz DONALD C. SMALTZ Office of Independent Counsel
Statement of Expenditures (Cash basis)
Six Months Ended September 30, 2000 Personnel compensation and benefits
$392,973 Travel (note 2)
27,006 Rent, communications, and utilities (note 3)
72,150 Contractual services (note 4)
121,981 Acquisition of capital assets
436 Supplies and materials
6,215 Administrative services (note 5)
43,260 Total expenditures $664,021
____________________________________________________
The accompanying notes are an integral part of this statement.
DONALD C. SMALTZ Office of Independent Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies Reporting entity: The accompanying statement of
expenditures presents the expenditures of the Office of Independent Counsel-
Donald C. Smaltz (OICSmaltz) for the 6 months ended September 30, 2000. The
statement of expenditures includes only expenditures made from the
permanent, indefinite appropriation for the office of independent counsel
that are processed through the Administrative Office of the U. S. Courts
(AOUSC) and the OIC. Mr. Smaltz was appointed on September 9, 1994, to
investigate activities of a former Secretary of Agriculture.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by AOUSC or, for
noncash transfers, when charged by AOUSC. Most personnel compensation and
benefits are recorded at the end of the pay period when earned.
Note 2 - Travel Travel generally includes expenditures for travel paid for
OIC- Smaltz personnel.
Note 3 - Rent, communications, and utilities Approximately $51,000 in office
rent is included in rent, communications, and utilities.
Note 4 - Contractual services Contractual services primarily consist of
expenditures for services of experts and other specialists in areas of
interest to the investigation.
Note 5 - Administrative services AOUSC receives an administrative fee equal
to 3 percent of OIC expenditures for performing disbursement and accounting
functions for OICSmaltz. Payment of these fees generally occurs in the month
following the services. Also included in administrative services are other
costs, amounting to $24,468, incurred by AOUSC in providing administrative
guidance and support to independent counsel offices. These costs were
certified by AOUSC, paid from the independent counsel appropriation, and
allocated to the OIC.
Note 6 - Receipts (unaudited) As of September 30, 2000, OIC- Smaltz's
convictions and referrals have resulted in the imposition of $11,597,256 in
criminal fines, civil penalties, damages, and reimbursement of costs.
Approximately $9,926,850 of that amount has been received and deposited into
the U. S. Treasury.
Statement of Expenditures for Special
Appendi x VII
Counsel Danforth JOHN C. DANFORTH Office of Special Counsel Statement of
Expenditures
(Cash basis) Six Months Ended September 30, 2000
Personnel compensation and benefits $1,335,846
Travel (note 2) 102,638
Rent, communications, and utilities (note 3) 673,771
Contractual services (note 4) 4,014,145
Acquisition of capital assets (note 5) 307,428
Supplies and materials 37,362
Administrative services (note 6) 6,000 Total expenditures
$6,477,190 ____________________________________________________ The
accompanying notes are an integral part of this statement.
JOHN C. DANFORTH Office of Special Counsel Notes to Statement of
Expenditures
Note 1 - Accounting policies
Reporting entity: The accompanying statement of expenditures presents the
expenditures of the Office of Special Counsel- John C. Danforth (OSC-
Danforth) for the 6 months ended September 30, 2000. The statement of
expenditures includes only expenditures made from the permanent, indefinite
appropriation for OSC- Danforth that are processed through the Department of
Justice. On September 9, 1999, the Attorney General appointed John C.
Danforth as a Special Counsel to investigate the government conduct relative
to events at the Branch Davidian complex near Waco, Texas, on April 19,
1993. Mr. Danforth submitted his final report to the Deputy Attorney General
concerning the 1993 confrontation at the Branch Davidian complex on November
8, 2000.
Basis of accounting: The accompanying statement of expenditures was prepared
principally on the cash basis of accounting, which is a comprehensive basis
of accounting other than U. S. generally accepted accounting principles.
Under this method, except for personnel compensation and benefits,
expenditures are recorded when the funds are disbursed by the Department of
Justice. Personnel compensation and benefits are recorded at the end of the
pay period when earned.
Note 2 - Travel
Travel generally includes expenditures for investigation- related travel for
OSC- Danforth personnel and detailees from other components of the
Department of Justice.
Note 3 - Rent, communications, and utilities
Approximately $287,700 in office rent is included in rent, communications,
and utilities. This category also includes rental charges for office
furniture.
Note 4 - Contractual services
Contractual services consist primarily of expenditures for litigation
support, investigation services, contract guard services, and other
specialists in areas of interest to the investigation.
Note 5 - Acquisition of capital assets
The capital assets expenditures are primarily for automated data processing
equipment. These assets will remain the property of the federal government
at the conclusion of the investigation.
Note 6 - Administrative services
Administrative services represent Department of Justice expenditures for
performing administrative and payroll functions for OSC- Danforth.
Note 7 - Other costs (unaudited)
Certain costs relating to employees assigned to work with OSC- Danforth by
the U. S. Postal Service and the Department of Justice were financed through
funds appropriated to these agencies and, accordingly, are not included in
the statement of expenditures. These agencies were not reimbursed for these
costs. The schedule below shows the estimated costs (unaudited) of the
assistance provided to the OSC- Danforth during the 6- month period, based
on information provided by officials of these agencies
Costs (unaudited)
Postal Service $1,869,526
Justice 35,607
$1,905,133
(194001) Lett er
GAO United States General Accounting Office
Page 1 GAO- 01- 505 Independent and Special Counsel
Contents Letter 3 Auditor's Report 5 Appendixes Appendix I: Statement of
Expenditures for Independent
Counsel Barrett 12 Appendix II: Statement of Expenditures for Independent
Counsel
Bruce 15 Appendix III: Statement of Expenditures for Independent Counsel
Lancaster 18
Appendix IV: Statement of Expenditures for Independent Counsel Pearson 21
Appendix V: Statement of Expenditures for Independent Counsel Ray 24
Appendix VI: Statement of Expenditures for Independent Counsel Smaltz 28
Appendix VII: Statement of Expenditures for Special Counsel Danforth 31
Abbreviations
AOUSC Administrative Office of the U. S. Courts FBI Federal Bureau of
Investigation OIC Office of Independent Counsel OSC Office of Special
Counsel
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Appendix I
Appendix I Statement of Expenditures for Independent Counsel Barrett
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Appendix I Statement of Expenditures for Independent Counsel Barrett
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Appendix II
Appendix II Statement of Expenditures for Independent Counsel Bruce
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Appendix II Statement of Expenditures for Independent Counsel Bruce
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Appendix III
Appendix III Statement of Expenditures for Independent Counsel Lancaster
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Appendix III Statement of Expenditures for Independent Counsel Lancaster
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Appendix IV
Appendix IV Statement of Expenditures for Independent Counsel Pearson
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Appendix IV Statement of Expenditures for Independent Counsel Pearson
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Appendix V
Appendix V Statement of Expenditures for Independent Counsel Ray
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Appendix V Statement of Expenditures for Independent Counsel Ray
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Appendix V Statement of Expenditures for Independent Counsel Ray
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Note 7 - Other costs (unaudited)
Certain costs relating to employees assigned to work with the OIC by the
FBI, the U. S. Marshals Service, and the Department of Justice were financed
through funds appropriated to these agencies and, accordingly, are not
included in the statement of expenditures. These agencies were not
reimbursed for these costs. The schedule below shows the estimated costs
(unaudited) of the assistance provided to the OIC during the 6- month
period, based on information provided by officials of these agencies.
Costs (unaudited)
Marshals Service FBI Other Justice
$11,720 115,537
2,624 $129,881
Page 28 GAO- 01- 505 Independent and Special Counsel
Appendix VI
Appendix VI Statement of Expenditures for Independent Counsel Smaltz
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Appendix VI Statement of Expenditures for Independent Counsel Smaltz
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Appendix VII
Appendix VII Statement of Expenditures for Special Counsel Danforth
Page 32 GAO- 01- 505 Independent and Special Counsel
Appendix VII Statement of Expenditures for Special Counsel Danforth
Page 33 GAO- 01- 505 Independent and Special Counsel
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