Seized Property and Forfeited Assets Systems Requirements: Checklist for
Reviewing Systems Under the Federal Financial Management Improvement Act
(Guidance, 10/01/2000, GAO/GAO-01-99G).

GAO published a guide to assist agencies and internal auditors in
maintaining their financial management systems in compliance with the
Federal Financial Management Improvement Act (FFMA) of 1996. The
checklist is intended to assist: (1) agencies in implementing and
monitoring their seized property and forfeited systems; and (2) managers
and auditors in reviewing agency seized property and forfeited systems
to determine if they substantially comply with FFMIA.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  GAO-01-99G
     TITLE:  Seized Property and Forfeited Assets Systems Requirements:
	     Checklist for Reviewing Systems Under the Federal
	     Financial Management Improvement Act
      DATE:  10/01/2000
   SUBJECT:  Management information systems
	     Financial management systems
	     Auditing procedures
	     Auditing standards
	     Assets
	     Internal controls
	     Search and seizure
	     Accounting standards
IDENTIFIER:  JFMIP Joint Financial Management Improvement Program
	     GAO Financial Management Series
	     JFMIP

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GAO-01-99G

A

Financial Management Series

October 2000 SEIZED PROPERTY AND FORFEITED ASSETS SYSTEMS REQUIREMENTS

Checklist for Reviewing Systems Under the Federal Financial Management
Improvement Act

GAO- 01- 99G

GAO United States General Accounting Office

GAO- 01- 99G – Seized Property and Forfeited Assets Systems Checklist
(10/ 00)
______________________________________________________________________________

CONTENTS

______________________________________________________________________________
Overview 5

Authoritative Guidance 6 How to Use This Checklist 7

Seized Property and Forfeited Assets Systems Requirements 9 Seizure
Activities 11 Custody Activities 13 Forfeiture Activities 16 Disposition
Activities 18 Reporting and Other Requirements 21 General Systems
Requirements 25 Interfacing Systems 27 System Administration 30 Records
Retention 31 Other General Systems Issues 32

Figure

Figure 1: Agency Systems Architecture 5

Abbreviations

CFO chief financial officer FASAB Federal Accounting Standards Advisory
Board FFMIA Federal Financial Management Improvement Act of 1996 GPRA
Government Performance and Results Act of 1993 JFMIP Joint Financial
Management Improvement Program OMB Office of Management and Budget SFFAS
Statement of Federal Financial Accounting Standards

Page 2 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) (BLANK)

Page 3 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)
______________________________________________________________________________

PREFACE

______________________________________________________________________________
October 2000 The Federal Financial Management Improvement Act (FFMIA) of
1996 requires, among other things, that agencies implement and maintain
financial management systems that substantially comply with federal
financial management systems requirements. These requirements are detailed
in the Financial Management Systems Requirements series issued by the Joint
Financial Management Improvement Program (JFMIP), in Office of Management
and Budget (OMB) Circular A- 127, Financial Management Systems, and OMB's
Implementation Guidance for the Federal Financial Management Improvement Act
(FFMIA) of 1996, issued September 9, 1997. JFMIP intends for the
requirements to

promote understanding of key financial management systems concepts and
requirements, to provide a framework for establishing integrated financial
management systems to support program and financial managers, and to
describe specific requirements of individual types of financial management
systems.

We are issuing this checklist that reflects JFMIP's revised Seized Property
and Forfeited Assets Systems Requirements (December 1999) to assist (1)
agencies in implementing and monitoring their seized property and forfeited
systems and (2) managers and auditors in reviewing agency seized property
and forfeited assets systems to determine if they substantially comply with
FFMIA. This checklist is not required to be used in assessing the seized
property and forfeited systems. It is provided as a tool for use by
experienced staff. This checklist, the JFMIP source document, and the two
previously mentioned OMB documents should be used concurrently. Experienced
judgment must be applied in the interpretation and application of this tool
to enable a user to consider the impact of the completed checklist on the
entire seized property and forfeited systems and whether the systems, as a
whole, substantially comply with requirements.

Additional copies of the checklist can be obtained from U. S. General
Accounting Office, 700 4th St. NW, Room 1100, Washington, D. C. 20548, or by
calling (202) 512- 6000, or TDD (202) 512- 2537. This checklist replaces
GAO's previously issued exposure draft of the Seized/ Forfeited Asset System
Checklist (April 2000) and is available on the Internet on

GAO's Home Page ( www. gao. gov) under “Other Publications.”
Jeffrey C. Steinhoff Managing Director Financial Management and Assurance

Page 4 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) (BLANK)

Page 5 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)
______________________________________________________________________________

OVERVIEW
______________________________________________________________________________

The Federal Financial Management Improvement Act (FFMIA) of 1996 requires,
among other things, that agencies implement and maintain financial
management systems that substantially comply with federal financial
management systems requirements. These system requirements are detailed in
the Financial Management Systems Requirements series issued by the Joint
Financial Management Improvement Program (JFMIP) 1 and Office of Management
and Budget (OMB) Circular A- 127, Financial Management Systems. JFMIP
requirements documents identify (1) a framework for financial management
systems, (2) core financial systems requirements, and (3) 16 other financial
and mixed systems supporting agency operations, not all of which are
applicable to all agencies. Figure 1 is the JFMIP model that illustrates how
these systems interrelate in an agency's overall systems architecture.

Figure 1: Agency Systems Architecture Source: JFMIP Seized Property and
Forfeited Assets Systems Requirements (December 1999). 1 JFMIP is a joint
cooperative undertaking of OMB, the General Accounting Office, the
Department of the Treasury, and the Office of Personnel Management, working
in cooperation with each other and with operating agencies to improve
financial management practices throughout the government. The program was
initiated in 1948 by the Secretary of the Treasury, the Director of the
Bureau of the Budget (now OMB), and the Comptroller General and was given
statutory authorization in the Budget and Accounting Procedures Act of 1950.
The Civil Service Commission, now the Office of Personnel Management (OPM),
joined JFMIP in 1966.

Page 6 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) To date, JFMIP has issued the framework and systems
requirements for the core financial

system and 8 of the 16 systems identified in the architecture. (See figure
1.) 2 We are issuing this checklist that reflects JFMIP's revised Seized
Property and Forfeited Assets Systems Requirements( December 1999) to assist
(1) agencies in implementing and monitoring their seized property and
forfeited assets systems and (2) managers and auditors in reviewing agency
seized property and forfeited assets systems to determine if they are in
substantial compliance with FFMIA. This checklist is not required to be used
in assessing the seized property and forfeited assets systems. It is
provided as a tool for use by experienced staff. This checklist, the JFMIP
source document, OMB Circular A127, Financial Management Systems, and OMB's
Implementation Guidance for the Federal Financial Management Improvement Act
(FFMIA) of 1996, issued September 9, 1997 should be used concurrently.
Experienced judgment must be applied in the interpretation and application
of this tool to enable users to consider the impact of the completed
checklist on their entire seized property and forfeited assets systems and
whether the systems, as a whole, substantially comply with requirements.

Authoritative Guidance

OMB Circular A- 127 and OMB's implementation guidance provide the basis for
assessing compliance with the FFMIA requirements for agencies to implement
and maintain financial management systems that comply substantially with
federal requirements. The implementation guidance identifies various
criteria that an agency must meet to substantially comply with these
requirements. One of the criteria listed in the OMB guidance is the JFMIP
systems requirements series.

The source of all the questions in this checklist is the JFMIP Seized
Property and Forfeited Assets Systems Requirements (JFMIP- SR- 99- 14,
December 1999). This JFMIP document is an update of the March 1993 JFMIP
Seized/ Forfeited Assets System Requirementsdocument. This update
incorporates legislative changes and federal accounting standards, including
Federal Accounting Standards Advisory Board (FASAB) Statement of Federal
Financial Accounting Standards Standard Number 3, Accounting for Inventory
and Other Related Property( SFFAS No. 3). The new requirements document has
been expanded to include new sections on property seized for purposes other
than forfeiture and the corresponding system requirements. These
requirements cover any property, regardless of value, seized by the federal
government as well as assets forfeited to the federal government as a
consequence of a law enforcement action or property abandonment proceedings.
The checklist is based on the existing published JFMIP standards. Changes in
laws, regulations, and standards and practices since the standards were
issued are not included in the checklist.

2 Thus far, the series includes the (1) Framework for Federal Financial
Management Systems,( 2) Core Financial System Requirements,( 3) Inventory
System Requirements, (4) Seized Property and Forfeited Assets System
Requirements,( 5) Direct Loan System Requirements,( 6) Guaranteed Loan
System Requirements,( 7) Travel System Requirements,( 8 ) Human Resources &
Payroll Systems Requirements,( 9) System Requirements for Managerial Cost
Accounting, and (10) Grant Financial System

Requirements. In early 1998, JFMIP decided to initiate projects to update
system requirements documents that were not current with regulations and
legislation. JFMIP also planned to initiate projects to complete the
remaining systems requirements.

Page 7 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) The revised JFMIP document segregates functional
requirements into two general

categories-- mandatory and value added. The mandatory requirements describe
what the system must do and consist of the minimum acceptable functionality
necessary to establish a system or are based on federal laws and
regulations. Mandatory requirements are those against which agency heads
evaluate their systems to determine substantial compliance with system
requirements under FFMIA. These requirements apply to existing systems in
operation and new systems planned or under development. The checklist uses
“( M)” immediately following the question to indicate that it is
mandatory for the system to do that.

The value- added requirements describe features or characteristics and may
consist of any combination of the following: (1) using state- of- the- art
technology, (2) employing the preferred or best business practices, or (3)
meeting the special management needs of an individual agency. Value- added,
optional, and other similar terminology may be used to describe this
category of requirements. Agencies should consider value- added features
when judging systems options. The need for these value- added features in
agency systems is left to the discretion of each agency head. The checklist
uses “( V)”

immediately following the question to indicate that the item is value added
rather than mandatory.

How to Use This Checklist

OMB's 1997 implementation guidance provides chief financial officers (CFO)
and inspectors general with a means for determining whether their agencies'
financial management systems substantially comply with federal financial
management systems requirements. The annual reporting required pursuant to
section 4 of the Federal Managers' Financial Integrity Act (FMFIA) of 1982
is one of the means to assist agencies in the determination of substantial
compliance. Agencies can also use this checklist as a tool to help determine
compliance with federal financial management systems requirements. 3

Filling out this checklist will allow agencies to systematically determine
whether specific systems requirements are being met. In determining
substantial compliance, agencies should assess the results of the completed
checklist on the seized property and forfeited assets systems requirements
taken as a whole.

3 In addition, the CFO Council has charged the Financial Systems Committee
with developing implementation guidance for performing FFMIA and other
compliance reviews. The CFO Council and JFMIP plan to jointly issue the
guidance. The checklist contains three columns with the first citing the
question followed by either

“( M)” for mandatory requirements or “( V)” for
value added. Use the second column to answer each question
“yes,” “no,” or “na.” Use the third
column to explain your answer. A “yes” answer should indicate
that the agency's seized property and forfeited assets systems provide for
the capability described in the question. For each “yes” answer,
the third column should contain a brief description of how the seized
property and forfeited assets systems satisfy that capability and should
also refer to a source that explains or shows the capability.

A “no” answer indicates that the capability does not exist. For
a “no” answer, the third column should provide an explanation
and, where applicable, a reference to any related

Page 8 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) supporting documentation (e. g., the agency is working on
modifying or implementing its

seized property and forfeited assets systems to have the capability
available in subsequent years; management believes the capability is not
cost effective and will not enhance the seized property and forfeited assets
systems' ability to manage operations). Cost- benefit studies, or other
reasoning, that supports a “no” answer should be identified in
the explanation column. If there are no cost- benefit studies or other
support, a full explanation should be provided.

“No” answers should not be viewed individually or taken out of
context. Rather, “no” answers should be assessed as to their
impact on the overall seized property and forfeited assets systems and the
extent to which the “no” answers inhibit the entire seized
property and forfeited assets systems from being substantially compliant.

Certain questions within the checklist may not be applicable to the agency.
Answer such nonapplicable question( s) with “na” and provide an
appropriate explanation in the third column.

Page 9 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)
______________________________________________________________________________

SEIZED PROPERTY AND FORFEITED ASSETS SYSTEMS REQUIREMENTS

______________________________________________________________________________
JFMIP's Seized Property and Forfeited Assets Systems Requirementsdefines
mandatory and value- added functional requirements for the following seized
property and forfeited assets elements that are described below: (1) seizure
activities, (2) custody activities, (3) forfeiture activities, (4)
disposition activities, (5) reporting and other requirements, (6) general
systems requirements, (7) interfacing systems, (8) system administration,
(9) records retention, and (10) other general systems issues.

1. Seizure activities. When certain civil and criminal laws or regulations
are violated, enforcement agencies have the authority to seize the property.
All federal government seizures of private property must be made in
accordance with applicable laws and regulations and must be specifically
authorized. This initial authorization is the cornerstone of all subsequent
activity. (The checklist questions for this area are drawn from p. 15 of the
JFMIP source document.)

2. Custody activities. Organizations that have custody of seized property
and forfeited assets must have adequate policies and procedures to ensure
that all property and assets are properly received, recorded, valued,
maintained, and controlled throughout the legal process underlying the
seizure. (The checklist questions for this area are drawn from p. 16 of the
JFMIP source document.)

3. Forfeiture activities. As a consequence of certain legal proceedings,
title to property, real or personal, is transferred to the United States.
(The checklist questions for this area are drawn from p. 17 of the JFMIP
source document.)

4. Disposition activities. A key component of effective property seizure and
asset forfeiture processes is disposing of the property in an orderly
fashion after determining that disposition is appropriate. If asset
disposition is perceived to be unfair or inefficient, the effectiveness of
the entire process could be called into question. In some cases, the
property may be returned to an entity outside of the federal government as a
result of the law enforcement action. It is particularly important to
account for all costs, revenues, and proceeds from disposition. (The
checklist questions for this area are drawn from p. 18 of the JFMIP source
document.)

5. Reporting and other requirements. All seized property and asset
forfeiture systems must be able to support management's objectives for
efficiency and quality in order to ensure compliance with Government
Performance and Results Act (GPRA) of 1993 requirements. They must fully
disclose the financial results of the program. (The checklist questions for
this area are drawn from p. 19 of the JFMIP source document.)

6. General systems requirements. This section covers general requirements
not found in other sections. (The checklist questions for this area are
drawn from p. 20 of the JFMIP source document.)

Page 10 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00) 7. Interfacing systems. Agency financial management
systems fall into four

categories: core financial systems, other and mixed systems (including
inventory systems), shared systems, and departmental executive information
systems (systems that provide management information to all levels of
managers). These systems must be linked together electronically to be
effective and efficient. (The checklist questions for this area are drawn
from p. 21 of the JFMIP source document.)

8. System administration. System administration provides centralized control
over a seized property and forfeited assets system. (The checklist questions
for this area are drawn from p. 22 of the JFMIP source document.)

9. Records retention. Federal government records may be destroyed only with
proper approval. (The checklist questions for this area are drawn from p. 23
of the JFMIP source document.)

10. Other general systems issues. This section covers other general
requirements not found in other sections. (The checklist questions for this
area are drawn from p. 24 of the JFMIP source document.)

The checklist questions follow the JFMIP source document. It should be noted
that not all questions will apply in all situations and, as with the use of
any checklist, professional judgment should be exercised. Using the JFMIP
source document and its “Appendix B: Glossary,” which defines
terms used, along with OMB Circular A- 127, Financial Management Systems,
and OMB Implementation Guidance for the Federal Financial Management
Improvement Act (FFMIA) of 1996, issued September 9, 1997, will help

ensure that the user is cognizant of the background information necessary to
fully understand the questions.

______________________________________________________________________________
Seized Property and Forfeited Assets Systems Requirements
______________________________________________________________________________

Page 11 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Seizure activities Yes/ no/ na Explanation

1. Are all federal government seizures of private property made in
accordance with applicable laws and regulations, and are they specifically
authorized? (M)

2. Does the seized property system provide a unique identifier for the
property that will facilitate tracking through seizure, holding, and
disposition? (M)

3. Does the seized property system provide for the timely recording of the
date of seizure, the type of property, the location where it was seized, the
storage location, owner( s) if known, and any other entity involved in the
seizure? (M)

4. Does the seized property system provide for the timely and accurate
recording of the originally assigned value and any subsequent updates to the
valuation? (M)

5. Does the seized property system provide for the timely recording of any
mortgage and claim liabilities against each asset seized for forfeiture or
Internal Revenue Code enforcement?

(M)

6. Does the seized property system provide the capability to obtain current
information on the processing status of any seized property in the database
with the use of an automated query mechanism? (M)

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Seized Property and Forfeited Assets Systems Requirements

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Page 12 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Seizure activities Yes/ no/ na Explanation

7. Does the seized property system provide the information necessary to
enable routine verification of the legal authority for the seizure,
including the ability to verify that the agency seizure or forfeiture
criteria have been observed? (M)

8. Does the seized property system allow for the correction, amendment, and
cancellation of the seizure authorization for the property under seizure and
provide reports to responsible program officials on this activity? (M)

9. Does the seized property system provide the information necessary to
allow for the prompt payment of properly authorized and billed services?

(M)

10. Does the seized property system interact with the core financial system
to accomplish the task described in the prior question?

(M)

11. Does the seized property system allocate and record all appropriate
costs of the seizure on a basis consistent with the type of property and the
nature of the seizure? (M)

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Seized Property and Forfeited Assets Systems Requirements

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Page 13 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Custody activities Yes/ no/ na Explanation

1. Does the organization having custody of seized property and forfeited
assets have adequate policies and procedures to ensure that all seized
property and forfeited assets are properly received, recorded, valued,
maintained, and controlled throughout the legal process underlying the
seizure? (M)

2. Does the custody system component have the capability to capture, record,
and maintain accurate information on the current legal status, geographic
location, responsible custodian, and current recorded value of seized
property and forfeited assets in custody? (M)

3. Does the custody system component have the capability to provide a record
documenting that advertising and the issuance of notice of property seized
have been accomplished, if required? (M)

4. Does the custody system component have the capability to provide
information to enable seized cash to be deposited promptly into cash holding
accounts, if required? (M)

5. Does the custody system component have the capability to track and
promptly record the deposit of revenue generated by seized businesses and
cash on a basis consistent with the nature of the property?

(M)

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Seized Property and Forfeited Assets Systems Requirements

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Page 14 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Custody activities Yes/ no/ na Explanation

6. Does the custody system component have the capability to segregate
forfeited assets from property in a seized or detained status? (M)

7. Does the custody system component have the capability to allocate and
record all appropriate costs and revenues on a basis consistent with the
type of property and the nature of the custodial action? (M)

8. Does the custody system component have the capability to record and
account for all theft, loss, and damage expenses by identification number?
(M)

9. Does the custody system component have the capability to provide accurate
and timely reconciliations between the seizing agency's seizure records and
property records of custodians being used to maintain, store, and dispose of
seized property? (M)

10. Does the custody system component have the capability to provide
information to allow the independent verification that each item of seized
property or each forfeited asset is in the physical or constructive custody
of the government and that the recorded quantity, legal status, geographic
location, and value are accurate? (M)

11. Does the custody system component have the capability to provide
information to allow

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Seized Property and Forfeited Assets Systems Requirements

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Page 15 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Custody activities Yes/ no/ na Explanation

an independent verification that all billed contractor or vendor services
were actually performed? (M)

12. Does the custody system component have the capability to record and
track cost bonds, as appropriate? (M)

13. Does the custody system component have the capability to provide
information to pay promptly all contractors or vendors performing
maintenance or management services and to interact with the core financial
system to accomplish this task? (M)

14. Does the custody system component have the capability to record the
forfeiture, as appropriate? (M)

15. Does the custody system component have the capability to record
information on the legal authority for forfeiture, as appropriate? (M)

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Seized Property and Forfeited Assets Systems Requirements

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Page 16 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Forfeiture activities Yes/ no/ na Explanation

1. Does the abandoned property and forfeited assets system provide a unique
identifier for the property that will facilitate tracking through seizure,
holding, and disposition? (M)

2. Does the abandoned property and forfeited assets system provide for the
timely recording of the date of seizure, the type of property, the location
where it was seized, the storage location, owner( s) if known, and any other
entity involved in the seizure? (M)

3. Does the abandoned property and forfeited assets system provide for the
timely and accurate recording of the originally assigned value and any
subsequent updates to the valuation? (M)

4. Does the abandoned property and forfeited assets system provide for the
timely recording of any mortgage and claim liabilities against each asset
seized for forfeiture? (M)

5. Does the abandoned property and forfeited assets system provide the
capability to obtain current information on the processing status of any
abandoned property or forfeited assets in the database by use of an
automated query mechanism? (M)

6. Does the abandoned property and forfeited assets system provide the
information

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Seized Property and Forfeited Assets Systems Requirements

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Page 17 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Forfeiture activities Yes/ no/ na Explanation

necessary to enable routine verification of the legal authority for the
seizure? (M)

7. If the answer to the above question is yes, does the information include
the ability to verify that the agency seizure or forfeiture criteria have
been observed? (M)

8. Does the abandoned property and forfeited assets system provide the
information necessary for prompt payment of properly authorized and billed
services and interact with the core financial system to accomplish this
task? (M)

9. Does the abandoned property and forfeited assets system support the
recording and capture of all appropriate costs of the forfeiture process on
a basis consistent with the type of property? (M)

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Seized Property and Forfeited Assets Systems Requirements

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Page 18 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Disposition activities Yes/ no/ na Explanation

1. Does the asset disposition system component have the capability to record
each disposition, including the unique identifier of the property or asset,
type of property or asset, type of disposition, the individuals responsible
for authorizing and executing the actions, the value at time of disposition
or the gross proceeds generated from the disposition, and to whom the asset
or property was released or transferred? (M)

2. Does the asset disposition system component have the capability to
accurately record a partial distribution of an asset?

(M)

3. Does the asset disposition system component have the capability to record
all appropriate costs and revenues on a basis consistent with the type of
property and the nature of the disposal action? (M)

4. Does the asset disposition system component have the capability to verify
that proper authorization exists for all dispositions? (M)

5. Does the asset disposition system component have the capability to record
and account accurately for all distributions of excess revenues over
expenses? (M)

6. Does the asset disposition system component have the

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Seized Property and Forfeited Assets Systems Requirements

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Page 19 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Disposition activities Yes/ no/ na Explanation

capability to provide a complete accounting for both the applicable central
fund balances and any related deposit fund balance? (M)

7. Does the asset disposition system component have the capability to
provide an audit trail for assets distributed to other entities? (M)

8. Does the asset disposition system component have the capability to record
the deposit into the applicable account of all proceeds from the sale of
forfeited or abandoned assets?

(M)

9. Does the asset disposition system component have the capability to record
transfers of cash from the applicable deposit fund to the applicable central
fund account? (M)

10. Does the asset disposition system component have the capability to
support the payment of contractors, innocent owners, or approved claimants?
(M)

11. Does the asset disposition system component have the capability to flag
low- value and time- sensitive assets to ensure their timely recording and
liquidation? (V)

12. Does the asset disposition system component have the capability to
periodically test asset disposition transactions to

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Seized Property and Forfeited Assets Systems Requirements

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Page 20 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Disposition activities Yes/ no/ na Explanation

ensure that the process is not being victimized by insider 4 transactions?
(V)

13. Does the asset disposition system component have the capability to
ensure that all billed contractor services were actually performed? (V)

4 Most federal agencies have specific prohibitions or outright bans on
certain employees and contractors (1) participating in the disposal of
property and (2) subsequently acquiring that property.

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Seized Property and Forfeited Assets Systems Requirements

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Page 21 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Reporting and other requirements Yes/ no/

na Explanation

1. Are the seized property and asset forfeiture systems able to support
management's objectives for efficiency and quality in order to ensure
compliance with GPRA requirements? (M)

2. Are the seized property and asset forfeiture systems able to fully
disclose the financial results of the program? (M)

3. Are the seized property and asset forfeiture systems able to support
performance measures that management can use to assess the efficiency and
quality of the financial management process? (M)

4. Are the seized property and asset forfeiture systems able to support
performance measurement for specific program components, such as property
disposal? (M)

5. Is management able to assess performance from a variety of perspectives,
including programwide or agencywide levels? (V)

6. Do the seized property and asset forfeiture systems provide reports for
accounting and payment history purposes that are adapted to meet agency
needs? (M)

7. Efficiency and quality performance indicators may include the periodic
calculation of the time elapsed for each

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Seized Property and Forfeited Assets Systems Requirements

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Page 22 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
Checklist (10/ 00)

Reporting and other requirements Yes/ no/

na Explanation

seizure to proceed through the asset forfeiture process and a comparison of
the time elapsed to established management goals. At a minimum, both the
time necessary to complete the entire process and the time intervals between
the following key processing steps should be measurable, on a average, for
any individual seizure and for each asset type. Do the seized property and
asset forfeiture systems have the following features:

ï¿½ cash seizure to deposit into holding account, if appropriate? (V)

ï¿½ seizure to noticing? (V)

ï¿½ petition receipt to petition ruling? (V)

ï¿½ seizure to forfeiture? (V)

ï¿½ forfeiture to disposal? (V)

ï¿½ equitable sharing request to sharing decision? (V)

ï¿½ forfeiture to equitable sharing disbursement? (V)

ï¿½ periodic recording of the results of individual contract compliance audits
of valuation, custodial, disposition, and maintenance activities? (V)

ï¿½ periodic comparisons between the date that each seizure or forfeiture
event is captured in the system and

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Reporting and other requirements Yes/ no/

na Explanation

the date the event actually occurred and comparisons of results to
established management data entry goals? (V)

ï¿½ periodic calculation of trends in theft, loss, or damage to seized
property or forfeited assets? (V)

ï¿½ record of preliminary estimates of the timing and the financial results
(net dollar value realized, the percentage of the currently recorded
appraised value realized, and the percentage of value lost) for each
forfeited asset? (V)

ï¿½ periodic calculation of trends in the ratio of property management and
disposal costs to gross sales proceeds for all assets sold and comparisons
of results to established management goals? (V)

ï¿½ periodic calculation of trends in the ratio of gross sales proceeds to
appraised or market value of all assets sold by asset type and comparison to
established management goals? (V)

ï¿½ periodic assessment of management control structure to ensure, to the
extent possible, that seized property and forfeited assets are safeguarded
against loss from unauthorized use or disposition and that

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Page 24 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
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Reporting and other requirements Yes/ no/

na Explanation

transactions are executed in accordance with management's authorization and
recorded properly to permit the preparation of financial statements? (V)

ï¿½ accumulate performance information on all vendors and contractors (both
private and government) that perform custodial or maintenance services? (V)

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General systems requirements Yes/ no/ na Explanation

1. The JFMIP Framework for Federal Financial Management Systemscontains
information on internal controls, systems architecture, software
documentation, and other matters related to seized property and forfeited
assets systems development, operations, and maintenance. Is supporting
documentation maintained throughout the editing and processing activity of
the system? (M)

2. Is the system able to accept, process, and report on transactions with
other internal and external systems? (M)

3. Is the system able to record and track these transactions and related
information in order to provide the basis for control?

(M)

4. The requirements for software documentation are listed in the Core
Financial System

Requirements. The information provided is meant to identify the scope and
intent of the documentation requirements rather than to state them
definitively. Are the software and documentation maintained under
configuration management in order to maintain system integrity and ensure
internal controls? (M)

5. Are transactions reviewed to make sure that they are processed correctly
and that the data produced are reliable after

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General systems requirements Yes/ no/ na Explanation

the seized property and forfeited asset system is implemented? (V)

6. Is the testing conducted with structure test data and with actual
production data? (M)

7. Are daily, monthly, quarterly, and fiscal year- end reports reviewed
prior to dissemination, whenever possible, to ensure that the data have been
updated correctly? (V)

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Page 27 GAO- 01- 99G – Seized Property and Forfeited Assets Systems
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Interfacing systems Yes/ no/ na Explanation

1. Agency financial management systems fall into four categories: core
financial systems, other and mixed systems (including inventory systems),
shared systems, and departmental executive information systems (systems to
provide management information to all levels of managers). Are these systems
linked together electronically in order to be effective and efficient? (M)

2. Are summary data transfers provided from agency systems to central
systems to permit summaries of management information and agency financial
performance information governmentwide?

(M)

3. Does the interface system's physical design consider the agency's
organizational philosophy, the technical capabilities available, and the
most appropriate manner to achieve the necessary single, integrated
financial management system for the agency? (V)

4. Is the system able to process transactions from other external systems
and record and track such transactions and related information to provide
the basis for central control? (V)

5. Is a customized interface provided to properly identify

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Interfacing systems Yes/ no/ na Explanation

and format the transactions?

(V)

6. Does the system provide the flexibility to accept data input from
multiple media that recognize user agencies' unique data input requirements?
(V)

7. Does the system provide the capability to customize data input,
processing rules, and edit criteria and to give agencies flexibility in
defining internal operational procedures and supporting agency requirements?
(V)

8. Does the system provide the capability, if necessary, to identify and
process transactions from other systems that enter and update the standard
seized property and forfeited assets system? (V)

9. Does the system provide the capability to subject all transactions from
interfacing systems to the standard seized property and forfeited assets
system edits, validations, and error correction procedures?

(V)

10. Does the system provide the capability to upload and download data in an
interface environment? (V)

11. Does the system provide the flexibility to provide multiplemedia output
reports and recognize user agencies' unique data output requirements? (V)

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Interfacing systems Yes/ no/ na Explanation

12. Does the system provide the capability to allow users to customize
output for reporting and provide interfaces to other systems necessary to
link financial and program results and meet agency requirements for external
processing (e. g., general ledger posting, budget reconciliation and
execution, cost accumulation)? (V)

13. Does the system provide the capability to transmit information on the
results of seizure transactions and forfeiture transactions to the core
financial system requirements itemized in the Core Financial System
Requirementsfor such purposes

as generating requests for disbursements, updating the standard general
ledger, generating obligation records, generating requests for funds
transfer, and updating funds control? (V)

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System administration Yes/ no/ na Explanation

1. Do the systems administration support personnel maintain an adequately
skilled work force?

(M)

2. Do the systems administration support personnel maintain effective
financial systems interfaces? (M)

3. Do the systems administration support personnel monitor and respond to
user needs for information? (M)

4. Do the systems administration support personnel support and maintain an
effective system of internal controls? (M)

5. Do the systems administration support personnel maintain general system
information and documentation? (M)

6. Do the systems administration support personnel maintain an effective
record retention process? (M)

7. Do the systems administration support personnel provide the capability to
interact directly with other system users and to develop an automated
exchange of information, where feasible?

(M)

8. Do the systems administration support personnel maintain system security?
(M)

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Records retention Yes/ no/ na Explanation

1. Are all agency- created records destroyed only with the approval of the
National Archives and Records Administration (NARA), per 36 CFR Part 1228?
For questions regarding the disposition of federal records, contact:

National Archives and Records Administration Life Cycle Management Division
7 th Street and Pennsylvania

Avenue NW Washington, DC 20408. (M)

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Other general systems issues Yes/ no/ na Explanation

1. Is the system in compliance with the general systems requirements (e. g.,
data stewardship, systems architecture, systems integration, and internal
control) contained in the Framework for Federal

Financial Management Systems, Federal Financial Management System
Requirements( FFMSR) 0, JFMIP, January 1995? (M)

The framework document, along with all other JFMIP requirements documents,
can be found at www. financenet. gov/ financenet/

fed/ jfmip/ jfmip. htm. (922291)

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