[Fiscal Year 1997 Audit Workplan Summary]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. 01-W-97

Title: Fiscal Year 1997 Audit Workplan Summary

Date: December 13, 1997


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Inspector General, Division of Acquisition and Management Operations at (202) 208-4599.
                  ******************************

 MEMORANDUM
                                   
TO:                  The Secretary
                 Solicitor
                 Assistant Secretaries
                 Heads of Bureaus and Offices

FROM:            Wilma A. Lewis
                 Inspector General

SUBJECT SUMMARY:  Fiscal Year 1997 Audit Workplan Summary

The Audit Workplan Summary for fiscal year 1997 is provided for your information and use.  The
Workplan Summary includes audits of the Department of the Interior's consolidated financial
statements, the bureaus' and offices' financial statements, programs and activities of the  bureaus and
offices within the Department, and other audits required by statutes or by Office of Management and
Budget directives.  These mandatory audits represent a major portion of our audit resources.

In developing the workplan, we considered performance audits of programs, activities, or functions
that were requested by Congressional committees and staff members, Departmental officials,  and
insular area government officials.  We also considered the mission-related areas of revenue-producing
activities, the management and protection of public lands and natural resources, the prevention and
cleanup of environmental hazards, and the financial management or administration of bureau
functions.  We further considered other factors in determining the planned audits, including the dollar
significance of the area, the length of time since the last audit, and the impact on the protection of
assets and/or program operations.  The workplan was designed to be flexible so that changes can be
made throughout the fiscal year to accommodate additional audits that may be mandated or
requested.  To initiate an audit in the workplan, we issue an announcement  memorandum to the
appropriate official, such as an Assistant Secretary or a bureau director.
  
To obtain additional copies of the Audit Workplan Summary, please contact Mr. Lennox Young,
within the Office of the Assistant Inspector General for Administration, at (202) 208-6491.  If you
have any questions about specific audits included in the Workplan Summary, you can contact the 
Director assigned to your bureau or office.  In that regard, the Director for financial statements and
related audits in all bureaus is Mr. Neal Littlefield at (202) 208-5725; the Director for U.S. Fish and
Wildlife Service, National Park Service, and Office of Surface Mining, Reclamation and Enforcement
audits of programs and activities is Mr. Andy Fedak at (202) 208-5659; the Director for Bureau of
Indian Affairs, Bureau of Reclamation, U.S. Geological Survey, multi-office, and Office of the
Secretary audits of  programs and activities is Mr. Roger LaRouche at (202) 208-5552; the Director
for Bureau of Land Management and Minerals Management Service audits of programs and activities
is Mr. Al Klein at (303) 236-9243; and the Director for insular area audits of programs and activities
is Mr. Arnold van Beverhoudt at (809) 774-8300.



cc:    Audit Liaison Officers


Subject: Fiscal Year 1997 Audit Workplan Summary (No. 01-W-97)                FISCAL YEAR 1997 AUDIT WORKPLAN
                           SUMMARY
  
  
  Bureau/Audit Title                                     Page
  
  Multi-Office
   
      Department of the Interior Consolidated Financial
         Statements for Fiscal Years 1996 and 1997       MOA-1 
         General Controls for Processing Transactions at the
         Administrative Service Centers (USGS, BOR)     MOA-2
      Award and Administration of Architectural/Engineering
         Services (BOR, NPS, FWS)                       MOA-4
  
  Office of the Secretary
   
      Office of the Secretary Financial Statements for Fiscal
         Years 1996 and 1997                             OSS-1
      Oversight of Audit of Indian Trust Funds Financial
         Statements for Fiscal Year 1996                         OSS-3
  
  Office of Insular Affairs
   
      Office of Insular Affairs Financial Statements for Fiscal
         Years 1996 and 1997                             OIA-1
  
  
  U.S. Fish and Wildlife Service
   
      U.S. Fish and Wildlife Service Financial Statements
         for Fiscal Years 1996 and 1997                  FWS-1
  
  Bureau/Audit Title (Continued)                        Page
  
      Land Acquisitions and Land Exchanges                       FWS-2
      Environmental Contaminants                      FWS-4
  
  National Park Service
   
      National Park Service Financial Statements for Fiscal
         Years 1996 and 1997                          NPS-1
      Servicewide Reservation System                             NPS-2
      Enhanced Annuity Retirement (6c) Program                   NPS-3
      Visitor Needs for New or Replacement Facilities                 NPS-4
      Land Acquisition Activities                     NPS-5
      Followup of Utility Rates                                  NPS-6
  
  Bureau of Indian Affairs
   
      Bureau of Indian Affairs Financial Statements for
         Fiscal Years 1996 and 1997                              BIA-1
      The Indian Estate Probate Process                          BIA-3
      Land Records Management System                  BIA-4
      Implementation of the Indian Self-Determination and
         Education Assistance Act                     BIA-5
      Administration of Individual Indian Money Accounts                                  at Selected Agencies                              BIA-6
      Fire Management Activities                      BIA-7
  
  Bureau of Land Management
   
      Bureau of Land Management Financial Statements for
         Fiscal Years 1996 and 1997                              BLM-1
      Hazardous Materials Management                             BLM-3
      Fire-Fighting Safety Management                            BLM-5
      Timber Activities on Public Lands                          BLM-7
      Land Use Planning Under the Federal Land Policy
         and Management Act of 1976                              BLM-9
  
  Minerals Management Service
   
      Minerals Management Service Financial Statements for
         Fiscal Years 1996 and 1997                              MMS-1
  
      
  Bureau/Audit Title (Continued)                       Page
  
      Biennial Audit of the Federal Royalty Management
         System                                        MMS-3
      Selected Aspects of the Outer Continental Shelf
         Lands Program                                 MMS-4
      Followup of Royalties on Tax Credits for 
         Nonconventional Fuels                                   MMS-6
  
  Office of Surface Mining Reclamation and Enforcement
  
      Office of Surface Mining Reclamation and Enforcement
         Financial Statements for Fiscal Years 1996 and 1997          OSM-1
      Fee Compliance Program                           OSM-3
      Administration of State Regulatory Grant Programs               OSM-4
      Administration of State Reclamation Grant Programs              OSM-6
  
  Bureau of Reclamation
  
      Bureau of Reclamation Financial Statements for Fiscal
         Years 1996 and 1997                           BOR-1
      Renewal of Central Valley Project Long-Term Water
         Service Contracts                             BOR-2
      Environmental Mitigation and Enhancement Costs
         Associated With Previously Constructed Facilities            BOR-4
      Programmatic Environmental Impact Statement,
         Central Valley Project Improvement Act                  BOR-7
  
  U.S. Geological Survey
  
      U.S. Geological Survey Financial Statements for
         Fiscal Years 1996 and 1997                              GSV-1
      Overhead Costs of Cost-Reimbursable Projects               GSV-3
  
  Government of Guam
  
      Construction of the Southern High School, Department
         of Public Works                               INS-1
      Gross Receipts Taxes, Department of Revenue and
         Taxation                                  INS-2
  
  
  
  
  Bureau/Audit Title (Continued)                       Page
  
  Commonwealth of the Northern Mariana Islands
  
      Commonwealth Legislature                         INS-3          Management of Federal Grants, Public School System          INS-4          Procurement Activities, Procurement and Supply
         Division, Department of Finance                         INS-5
  
  Federated States of Micronesia
  
      Rural Economic and Community Development
         Services, U.S. Department of Agriculture                INS-6
  
  Republic of the Marshall Islands
  
      Marshall Islands Development Bank                INS-8
  
  Republic of Palau
  
      Management and Oversight of Selected Construction
         Projects                                      INS-10
  
  American Samoa Government
  
      U.S. Fish and Wildlife Service Grants, Department of 
         Marine and Wildlife Resources                           INS-12
  
  Government of the Virgin Islands
  
      Hospital Services Charges, Roy L. Schneider and Juan F.
         Luis Community Hospitals                      INS-13
      Sewage System Service Charges, Department of Public
         Works                                     INS-14
      Construction Management Contract for the Hurricane
         Recovery Managers                             INS-15
      Hurricane-Related Contracting, Department of
         Education                                 INS-16
      Hurricane-Related Contracting, Department of Property
         and Procurement                           INS-17
      Followup of the Bureau of Corrections, Department of 
         Justice                                       INS-18
  
                          FACT SHEET
  
  
                  DEPARTMENT OF THE INTERIOR
              CONSOLIDATED FINANCIAL STATEMENTS
                FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Department of the Interior's consolidated financial statements for fiscal
  years 1996 and 1997.  The objective of the audit is to determine whether:  (1) the
  consolidated financial statements of the Department were presented fairly and in accordance
  with applicable accounting standards; (2) internal controls were effectively implemented (that
  is, assurance was provided that the Department complied with applicable laws and
  regulations; safeguarded funds, property, and other assets against waste, loss, unauthorized
  use, or misappropriation; and properly recorded and accounted for revenues and
  expenditures); (3) the Department complied with applicable laws and regulations as required
  by generally accepted government auditing standards; (4) the internal control evaluation
  process was in compliance with the Federal Managers' Financial Integrity Act and Office of
  Management and Budget guidelines and requirements; and (5) the significant financial
  information in the overview was consistent with the financial statements and the systems
  providing data for the significant performance measures in the overview were reliable.
                               FACT SHEET
  
  
         GENERAL CONTROLS FOR PROCESSING TRANSACTIONS
            AT THE ADMINISTRATIVE SERVICE CENTERS,
  U.S. GEOLOGICAL SURVEY AND BUREAU OF RECLAMATION
  
  
  TYPE OF AUDIT
  
  Performance - support of annual financial statement audits
  
  BACKGROUND
  
  The Department of the Interior operates two Administrative Service Centers: the Washington
  Administrative Service Center, in Reston, Virginia, under the direction of the U.S. Geological
  Survey, and the Denver Administrative Service Center, in Lakewood, Colorado, under the
  direction of the Bureau of Reclamation.  These centralized centers provide ADP services to
  all Departmental bureaus and, if contracted, for other Federal agencies.  The centers support
  planning, acquisition/development, implementation, and operation and maintenance of
  standardized Departmentwide administrative systems.
  
  The Washington Administrative Service Center is responsible, among other duties, for the
  following:
  
     - Overseeing software modifications of the Federal Financial System (FFS) for all
  Departmental bureaus and other clients.  In addition, the Center operates and maintains the
  FFS for three Departmental bureaus: the Geological Survey, the National Park Service, and
  the Bureau of Indian Affairs.
  
     - Implementing and maintaining the Department's standardized automated
  procurement system, the Interior Department Electronic Acquisition System (IDEAS).
  
     - Providing computer services and operational support for the Governmentwide
  Federal Procurement Data System (FPDS).
  
  The Denver Administrative Service Center is responsible, among other duties, for the
  following:
  
     - Providing, through the Payroll/Personnel System (PAY/PERS), payroll and
  personnel services to 16 Departmental bureaus and Federal agencies  that have more than
  110,000 employee accounts nationwide.  PAY/PERS also supports a variety of user
  equipment at 135 sites and access to its mainframe computer in Lakewood.
  
     - Developing, implementing, and maintaining a new personnel and payroll system, the
  Federal Personnel/Payroll System (FPPS), that will operate on the mainframe computer in
  Lakewood.
  
     - Maintaining and operating the FFS for three Departmental bureaus (the Bureau of
  Reclamation, the Bureau of Land Management, and the U.S. Fish and Wildlife Service), as 
  well as for other clients.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the internal controls at each center
  provided reasonable assurance that assets such as computers and the data contained therein
  were adequately safeguarded.  The audit is to be performed during fiscal year 1997 and
  reported in accordance with the American Institute of Certified Public Accountants Statement
  on Auditing Standards No. 70, "Reports on the Processing of Transactions by Service
  Organizations."
                               FACT SHEET
  
  
          AWARD AND ADMINISTRATION OF ARCHITECTURAL/
                    ENGINEERING SERVICES,
        BUREAU OF RECLAMATION, NATIONAL PARK SERVICE,
              AND U.S. FISH AND WILDLIFE SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - multibureau
  
  BACKGROUND
  
  The Department of the Interior has an extensive construction program, with most of the
  construction performed by three bureaus: the Bureau of Reclamation, the National Park
  Service, and the U.S. Fish and Wildlife Service.  The fiscal year 1996 budget requests for
  construction were as follows: Bureau of Reclamation, $375,900,000; National Park Service,
  $179,000,000; and Fish and Wildlife Service, $73, 600,000.
  
  All three of the bureaus have in-house capability to prepare the designs and specifications for
  their various construction projects.  However, because of limitations on in-house resources,
  technical complexities, and other factors, some of the design and specification work is
  contracted out to architectural/engineering firms.  For fiscal year 1995, the three bureaus
  reported, to the Department, architectural/engineering contract actions as follows:
  
                                      Actions       Amount    
   Bureau of Reclamation                 218    $9.2 million
   National Park Service                 686    26.0 million
   Fish and Wildlife Service             376    10.2 million
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the three bureaus awarded
  architectural/engineering services contracts in accordance with applicable laws and regulations
  and administered the contracts in accordance with policies, procedures, and contract
  provisions.  The scope of the audit will be a review of contracts awarded or administered
  during fiscal years 1995 and 1996.  The audit fieldwork will be conducted, as appropriate, at
  the agencies' construction service centers, all of which are located mainly in Denver,
  Colorado.
                          FACT SHEET
  
  
                   OFFICE OF THE SECRETARY
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by: (1) improving the financial management functions of the Office
  of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Office of the Secretary is composed of the Secretary's Office; the Office of the Solicitor;
  the Office of Inspector General; and the Office of Policy, Management and Budget, which
  includes the Office of Construction Management and the Working Capital Fund (including
  the Office of Aircraft Services).
  
  The Secretary's Office, including the Office of Policy, Management and Budget, provides
  executive direction and management for the Department of the Interior.  The Office of the
  Solicitor provides legal services for all components of the Department.  The Office of
  Inspector General provides audit and investigative services for the Department.  The Working
  Capital Fund was established to provide required central services, including aircraft services,
  to the Departmental offices and bureaus on a reimbursable basis. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Office of the Secretary's financial statements for fiscal years 1996 and 1997. 
  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Office complied with
  applicable laws and regulations; safeguarded funds, property, and other assets against waste,
  loss, unauthorized use, or misappropriation; and properly recorded and accounted for
  revenues and expenditures); (3) the Office complied with applicable laws and regulations as
  required by generally accepted government auditing standards; (4) the internal control
  evaluation process was in compliance with the Federal Managers' Financial Integrity Act and
  Office of Management and Budget guidelines and requirements; and (5) the significant
  financial information in the overview was consistent with the financial statements and the
  systems providing data for the significant performance measures in the overview were reliable.
                               FACT SHEET
  
  
                    OVERSIGHT OF AUDIT OF 
           INDIAN TRUST FUNDS FINANCIAL STATEMENTS
                     FOR FISCAL YEAR 1996
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Secretary of the Interior has been designated by the Congress as the U.S. Government
  trustee on behalf of the account holders of the Indian Trust Funds. Through February 8, 1996,
  the Secretary delegated the authority for management of the Indian Trust Funds to the
  Assistant Secretary - Indian Affairs, who carried out the management of the Indian Trust
  Funds through the Office of Trust Funds Management, Bureau of Indian Affairs. On February
  9, 1996, the Secretary transferred the management of the Indian Trust Funds  from the
  Bureau of Indian Affairs to the newly established Office of Special Trustee  for the American
  Indians within the Office of the Secretary. The Office of Trust Fund Management was also
  transferred from the Bureau of Indian Affairs to the Office of Special Trustee, but
  administrative support of the Office of Trust Fund Management will continue to be provided
  by the Bureau.
  
  The Office of Trust Fund Management has contracted with a public accounting firm to audit
  the Indian Trust Fund's financial statements. The financial audit of the operations of Office
  of Special Trustee and the Office of Trust Fund Management will be included in the financial
  statement audit of the Office of the Secretary, which is performed by the Office of the
  Inspector General.  Office of Management and Budget Bulletin 93-06, "Audit Requirements
  for Federal Financial Statements," requires oversight by the Inspector General of audits
  performed by independent external auditors in accordance with the Chief Financial Officers
  Act of 1990.   
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is for the Office of Inspector General to provide oversight of the
  audit of financial statements of Indian Trust Funds being performed by an independent
  external auditor.  Specifically, Section 10 of Bulletin 93-06 requires the Inspector General to:
  (1) ensure that audits of independent external auditors are performed in accordance with
  Bulletin requirements; (2) provide technical advice and liaison to agency officials and
  independent external auditors; (3) perform quality reviews of audits conducted by
  independent external auditors and  provide the results to other interested parties; and (4)
  monitor and report on management's progress in resolving audit findings reported by the
  independent external auditors.
                               FACT SHEET
  
                               
                  OFFICE OF INSULAR AFFAIRS 
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Office of Insular Affairs (formerly the Office of Territorial and International Affairs) has
  broad goals to promote the economic, social, and political development of the insular areas,
  leading each toward greater self-government, and to further international peace and security
  by conducting insular affairs in coordination with the defense and foreign policies of the
  United States.  Specific strategies are to promote private sector investment and economic
  diversification in the insular areas, to improve the efficiency of insular area governments, and
  to promote greater fiscal responsibility and accountability within the local governments. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Office of Insular Affairs financial statements for fiscal years 1996 and 1997. 
  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Office complied with
  applicable laws and regulations; safeguarded funds, property, and other assets against waste,
  loss, unauthorized use, or misappropriation; and properly recorded and accounted for
  revenues and expenditures); (3) the Office complied with applicable laws and regulations as
  required by generally accepted government auditing standards; (4) the internal control
  evaluation process was in compliance with the Federal Managers' Financial Integrity Act and
  Office of Management and Budget guidelines and requirements; and (5) the significant
  financial information in the overview was consistent with the financial statements and the
    systems providing data for the significant performance measures in the overview were reliable.                            FACT SHEET
  
  
                U.S. FISH AND WILDLIFE SERVICE
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The U.S. Fish and Wildlife Service has the principal Federal responsibility to conserve,
  protect, and enhance fish and wildlife and their habitats.  In fiscal year 1995, the Service
  managed 508 national wildlife refuges and 38 wetlands management districts in 186 counties
  on over 92 million acres.  In addition, the Service managed 74 fish hatcheries throughout the
  country.  
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the U.S. Fish and Wildlife Service's financial statements for fiscal years 1996
  and 1997.  The objective of the  audit is to determine whether:  (1) the financial statements
  were presented fairly and in accordance with applicable accounting standards; (2) internal
  controls were effectively implemented (that is, assurance was provided that the Service
  complied with applicable laws and regulations; safeguarded funds, property, and other assets
  against waste, loss, unauthorized use, or misappropriation; and properly recorded and
  accounted for revenues and expenditures); (3) the Service complied with applicable laws and
  regulations as required by generally accepted government auditing standards; (4) the internal
  control evaluation process was in compliance with the Federal Managers' Financial Integrity
  Act and Office of Management and Budget guidelines and requirements; and (5) the
  significant financial information in the overview was consistent with the financial statements
  and the systems providing data for the significant performance measures in the overview were
  reliable.
                          FACT SHEET
  
  
            LAND ACQUISITIONS AND LAND EXCHANGES,
                U.S. FISH AND WILDLIFE SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - Servicewide
  
  BACKGROUND
  
  The U.S. Fish and Wildlife Service operates and maintains 508 national wildlife refuges and
  38 wetlands management districts in 186 counties on over 92 million acres of land.  To carry
  out its responsibilities, the Service receives annual appropriations for land acquisitions for
  recreational development; protection of natural resources; and conservation of listed,
  threatened, or endangered species. The Service's land acquisition program consists of the
  Migratory Bird Conservation Fund, the Small Wetlands Acquisition Program, the Land and
  Water Conservation Fund, and the North American Wetlands Conservation Act Fund.  These
  programs receive funds from: (1) Land and Water Conservation Fund appropriations; (2)
  monies deposited into the Migratory Bird Conservation Fund that are derived from the sale
  of duck stamps, refuge entrance fees, and import duties on arms and ammunition; and (3)
  monies made available under provisions of the North American Wetlands Conservation Act.
  For fiscal year 1997, the Service requested $36.9 million for the Land and Water
  Conservation Fund, $44.9 million for the Migratory Bird Conservation Fund, and $11.8
  million for the North American Wetlands Conservation Act program (a portion of this amount
  is used for land acquisition).  The Service's land acquisition activities are performed by 288
  employees, who are located in the headquarters office, 7 regional offices, and 19 field offices.
  
  Lands purchased with Land and Water Conservation Fund monies are restricted to specific
  line-item projects authorized by the Congress.  However, acquisitions using monies in the
  Migratory Bird Conservation and the North American Wetlands Conservation Act Funds are
  not restricted other than being subject to approval by the Migratory Bird Conservation
  Commission.
  
  The Land Acquisition Planning Handbook states that the Service's policy is to acquire land
  only when other means (such as regulatory controls that include zoning, permits and
  ordinances, leasing, or easements) of achieving program goals and objectives are not
  appropriate, available, or effective. The Handbook further states that condemnation
  procedures should be used "only as a last resort," subject to Congressional approval, when
  landowners are not willing to sell their land.
  
  The Service also has a land exchange program, the overall goal of which is to improve the
  quality of  Federal holdings by exchanging public lands for private lands.  In fiscal years 1996
  and 1997, respectively, the Service requested land exchange funds totaling about  $2.5 million
  and $1 million to carry out the planning, appraisals, title work, negotiations, and other
  activities (including salaries and travel costs) related to the completion of land exchanges. For
  fiscal year 1997, the Service plans to secure about 1.7 million acres through its land exchange
  program.        
   
  The Service relies on the regulations promulgated by the Bureau of Land Management for its
  land exchange program.  The Bureau's regulations implement the provisions of the Federal
  Land Policy and Management Act of 1976 (Public Law 94-579) and the Federal Land
  Exchange Facilitation Act (Public Law 100-409).  Public Law 94-579 authorizes the disposal
  of Federal lands by exchange when such action serves the public interest, and it requires that
  the value of the lands exchanged be equal or, if not equal, be equalized by a cash payment by
  either party.  However, in no case may the value difference between the properties exceed 25
  percent of the value of the Federal land exchanged.  Public Law 100-409 authorizes
  adjustments in the values of the lands exchanged as a means of compensating proponents of
  the exchange for incurring certain costs. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Service conducted land acquisitions and
  exchanges efficiently and in accordance with applicable laws and regulations and was paying
  a fair price for the lands acquired.  During our survey, we will determine whether to conduct
  audit verification in one or both areas (acquisition or exchange).  The audit will cover land
  acquisition and exchange activities that occurred from fiscal year 1995 to the present.
                               FACT SHEET
  
  
                 ENVIRONMENTAL CONTAMINANTS,
                U.S. FISH AND WILDLIFE SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - Servicewide
  
  BACKGROUND
  
  The U.S. Fish and Wildlife Service has responsibility for the protection and conservation of
  fish and wildlife and their habitats.  As part of its mission, the Service is responsible for
  preventing, identifying, and assessing the threats of contaminants to its trust resources.  The
  Service is also responsible for cleaning up contaminants and for restoring resources at Service
  facilities.  Fiscal year 1996 funding related to the Service's environmental contaminants
  program was $14.2 million.
  
  The Service's contaminant prevention efforts are proactive measures to avoid the effects of
  contaminants as much as possible.  These efforts include analyzing:  (1) Clean Water Act
  planning documents and permits; (2) pest management and pesticide use; and (3) agricultural
  irrigation practices in the western United States.  The Service's contaminant identification and
  assessment efforts focus on conducting site-specific investigations; monitoring sites identified
  as having contaminant problems; and developing information needed to detect, avoid, or
  correct contaminant problems.   In addition, the Service's contaminants program assesses
  known and suspected sources of contaminants associated with past land uses and develops
  damage assessment information.  Working in cooperation with the U.S. Geological Survey,
  the Service is developing the contaminant monitoring component of the Geological Survey's
  Biomonitoring of Environmental Status and Trends (BEST) program.  Also, the Service has
  established priority ranking criteria to schedule new and continuing projects for cleanup.   
  
  The Service's contaminant program is managed by the Division of Environmental
  Contaminants, located in Arlington, Virginia.  The Division consists of the Contaminant
  Damage Assessment and Response Activities Branch and the Contaminant Prevention
  Investigation and Biomonitoring Branch.  In fiscal years 1996 and 1997, the Division had 152
  full-time equivalent positions and a budget of $8.82 million. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Service has: (1) taken timely and
  appropriate action to identify, assess, and implement actions to correct environmental
  contaminants and (2) has administered the program in accordance with applicable laws,
  regulations, and policies.  The scope of the audit will include a review of environmental
  contaminant activities that occurred during fiscal years 1994 to 1996.
                               FACT SHEET
  
  
                    NATIONAL PARK SERVICE
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by: (1) improving the financial management functions of the Office
  of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The National Park Service is responsible for managing, preserving, and protecting 368 areas
  covering 80 million acres that make up the national park system.  
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the National Park Service's financial statements for fiscal years 1996 and 1997. 
  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Park Service complied
  with applicable laws and regulations; safeguarded funds, property, and other assets against
  waste, loss, unauthorized use, or misappropriation; and properly recorded and accounted for
  revenues and expenditures); (3) the Park Service complied with applicable laws and
  regulations as required by generally accepted government auditing standards; (4) the internal
  control evaluation process was in compliance with the Federal Managers' Financial Integrity
  Act and Office of Management and Budget guidelines and requirements; and (5) the
  significant financial information in the overview was consistent with the financial statements
  and the systems providing data for the significant performance measures in the overview were
    reliable.                           FACT SHEET
  
  
               SERVICEWIDE RESERVATION SYSTEM,
                    NATIONAL PARK SERVICE
  
  
  TYPE OF AUDIT  
  
  Performance - program   
  
  BACKGROUND
  
  In 1990, the National Park Service determined that it was necessary to develop a
  computerized reservation system which would allow  visitors to secure advance campground
  reservations in popular and overcrowded park areas.  The intent of the reservation system is
  to provide a service to visitors by giving them assurance of access to facilities, programs, or
  services that are in heavy public demand.  The reservation system allows visitors to plan
  ahead, reduces traffic congestion in some locations, and increases management efficiency of
  campground operations. 
  
  In 1991, the Park Service awarded a negotiated contract to "Mistix" Corporation (now
  "Destinet").  The contract covers a 5-year period, with expiration on September 17, 1997. 
  The contract required the contractor to design, develop, and implement a computerized
  reservation system for the Park Service at no cost to the Government.  Under the contract,
  Destinet operates a campsite reservation system for individual and family campsites at 12 park
  units (Acadia, Assateague Island, Cape Hatteras, Death Valley, Grand Canyon, Great Smoky
  Mountains, Joshua Tree, Rocky Mountain, Sequoia-Kings Canyon, Shenandoah,
  Whiskeytown, and Yosemite) and a cave tour reservation system for Mammoth Cave
  National Park.
  
  In fiscal year 1996, Destinet collected reservation fees of about $8 million.  After adjusting
  for cancellations (refunds) and commissions (25 percent and/or 35 percent of the reservation
  fees collected), Destinet remitted fees totaling about $4 million to the Park Service.   
  
  AUDIT OBJECTIVE AND SCOPE  
  
  The objective of the audit is to determine whether: (1) the Park Service was receiving the
  appropriate revenues from Destinet for its operation of a campsite reservation system and (2)
  Destinet and the Park Service had established adequate administrative and accounting
  controls over these revenues. The scope of the audit will include program- and financial-related actions that occurred during the contract period. 
                          FACT SHEET
  
                               
                       ENHANCED ANNUITY
                   RETIREMENT (6c) PROGRAM,
                    NATIONAL PARK SERVICE
  
  
  TYPE OF AUDIT
  
  Financial - Servicewide
  
  BACKGROUND
  
  Title 5, Section 8336(c), of the United States Code authorizes immediate retirement benefits
  at age 50 for Federal employees who have completed 20 years of Federal service as a law
  enforcement officer or a fire fighter.  The Office of Personnel Management retained sole
  authority to determine whether an individual who performs service as a law enforcement
  officer or a fire fighter meets the retirement law's definitions of "law enforcement officer" or
  "firefighter" (5 U.S.C. 8331 (20) and 5 U.S.C. 8331 (21), respectively) and would therefore
  qualify for special retirement benefits.
  
  In December 1993, the Office of Personnel Management published interim rules that
  delegated the authority to bureaus and agencies to determine, with Office oversight, which
  of its employees qualified for law enforcement officer or fire fighter retirement coverage.  The
  Park Service has adopted the position that park rangers performing physically rigorous law
  enforcement and fire-fighting duties would be managed under the provisions of the Enhanced
  Annuity Retirement (6c) System.  
  
  In its 1997 budget justification, the Park Service proposed that a $5.66 million adjustment be
  made in the Resource Stewardship and the Visitor Services budget subactivities to partially
  fund the added costs of enhanced annuity retirement benefits for newly qualified Park Service
  law enforcement rangers.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Park Service administered the
  Enhanced Annuity Retirement (6c) System's program in accordance with applicable rules,
  regulations, and laws.  The scope of the audit will be a review of the claims submitted through
    September 1996 for (6c) retirement benefits.                           FACT SHEET
  
  
                        VISITOR NEEDS
              FOR NEW OR REPLACEMENT FACILITIES,
                    NATIONAL PARK SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - Servicewide
  
  BACKGROUND
  
  The National Park Service requests funds annually for the construction, enlargement, or
  remodeling of patron service facilities.  However, in some instances, for-profit companies
  outside park boundaries compete for the same customers.  Park Service policy contained in
  the Concessions Management Guideline (NPS-48) states, "If adequate facilities exist or can
  feasibly be developed by private enterprise to serve park visitors' needs for commercial
  services outside park boundaries, facilities will not be expanded or developed within parks." 
  Park Service policy directives also require that sound economic and qualitative analyses be
  performed to support any decision to build facilities within a park.
  
  In view of the limited funding for Park Service programs, the reduction or elimination of
  maintenance or development costs for patron services facilities that are not essential could
  provide additional funds for maintenance or other projects within the parks.  The Park
  Service's fiscal year 1996 budget justification included $293 million for park maintenance and
  $180 million for park construction, improvement, repairs, and replacements.  A portion of this
  amount was used to develop and maintain visitor services facilities.  
    
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Park Service complied with the
  Concessions Management Guideline (NPS-48) and other policy directives that restrict 
  expansion and development of visitor-related facilities within parks.  The audit will include
  a review of the visitor-related facilities constructed, expanded, or replaced from fiscal year
  1994 to the present and visitor facilities planned for construction and rehabilitation in future
    years.                             FACT SHEET
  
  
                 LAND ACQUISITION ACTIVITIES,
                    NATIONAL PARK SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - Servicewide
  
  BACKGROUND
  
  The National Park Service acquires lands for inclusion in the National Park System in order
  to preserve nationally important natural and historic resources.  Specifically, lands are
  acquired to establish new parks, to provide additions to existing parks, and to add boundaries
  around existing parks as a buffer for natural resource protection.
  
  The Park Service obtains financing for the purchase of properties from the Land and Water
  Conservation Fund.  The Fund also finances the coordination and administration of the
  acquisition program.  In addition, the Park Service uses appropriated funds to perform
  assessments of proposed new units to the Park System.  In fiscal year 1997, the Park Service
  requested $36.3 million for the land acquisition program:  $27.6 million for the purchase of
  lands, $1.5 million for grants to states, and $7.2 million for the administration of the program. 
  The acquisition of land for park units and other purposes is administered by the Land
  Resources Division, located in two Washington, D.C., offices; nine program centers; and five
  project offices.  The nine program centers are located in seven field areas and two Systems
  Support Offices.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the National Park Service planned,
  transacted, and administered land acquisitions efficiently, in compliance with applicable laws
  and regulations, and in accordance with Congressional directives and was paying a fair price
  for the lands acquired.  The audit will review land acquisition activities that occurred during
  fiscal years 1995 and 1996.
     
                          FACT SHEET
  
  
                  FOLLOWUP OF UTILITY RATES,
                    NATIONAL PARK SERVICE
  
  
  TYPE OF AUDIT
  
  Followup - Servicewide
  
  BACKGROUND
  
  The National Park Service constructs and operates utility systems in national parks that
  provide water and electricity and the removal of wastewater and solid wastes in some of its
  areas.  In other areas, the Park Service purchases utility services, such as electricity and solid
  waste hauling, from municipal utility companies.  In 71 of these areas, the utility services are
  made available to non-Governmental users, such as concessioners and inholders, within the
  area.  The non-Governmental users are required to reimburse the Park Service for the costs
  of providing these utility services.
  
  Title V of the Independent Offices Appropriations Act of 1952 (the User Fee Statute)
  authorizes Federal agencies to charge fees for services or benefits provided to beneficiaries. 
  Office of Management and Budget Circular A-25, "User Charges," provides guidance to
  Federal agencies on implementing the User Fee Statute.  The Department of the Interior
  Manual, Part 346, "Cost Recovery," requires (unless directed otherwise by statute or other
  authority) that a fee be established to recover a bureau's or an office's costs for services, such
  as utilities, that provide special benefits or privileges to an identifiable non-Governmental
  recipient.
  
  Park Service guidelines and policies on utility cost recovery from non-Governmental users
  are contained in its Special Directive 83-2, "Rates for NPS-Produced Utilities," dated June
  20, 1985.  The Directive provides guidance for the recovery of capital investments and
  operational costs for utility systems.  The capital investment costs for constructing or
  expanding systems and major rehabilitation or replacement of existing systems should be
  recovered from non-Governmental users through cost sharing or other means, whereas
  operational costs for utility systems are recovered through utility rates.  The rates should be
  based on the higher of either actual operational costs or comparable rates (rates for similar
  services in the same geographic location).
  
  In our January 1991 audit report "Utility Rates Imposed by the National Park Service" (No.
  91-I-333), we found that the Park Service did not adequately pursue the cost recovery of
  capital investments for utility systems from concessioners and inholders at national parks and
  other sites. This occurred because the Park Service's Special Directive 83-2 provides for less
  than full cost recovery through utility rates and does not provide sufficient direction to ensure
  that investment costs for capital projects are recovered through cost sharing or other means
  of recovery.  As a result, as much as $71.2 million may not be recovered from identifiable
  non-Governmental users for capital investments, of which $38.7 million was expended during
  fiscal years 1986 through 1989 and $32.5 million is planned to be expended for fiscal year
  1990 and beyond.  Of the 21 Park Service-operated sites we visited or contacted, only 1 was
  pursuing cost recovery of capital investments for utility systems, even though extensive
  expenditures were made or planned by most of these areas for water, wastewater, solid waste,
  and electrical utility systems that benefit non-Governmental users.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Park Service has satisfactorily
  implemented recommendations made in our January 1991 audit report and whether any new
  recommendations are warranted.  The audit will focus on utility rate charges for fiscal years
  1995 and 1996, which are based on costs for fiscal years 1994 and 1995.  We will also
  determine whether all applicable costs, including investment costs, were included in the utility
  rates.
                               FACT SHEET
  
  
                   BUREAU OF INDIAN AFFAIRS
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Bureau of Indian Affairs is responsible for managing and protecting natural resources on
  56 million acres of Indian trust lands and for assisting tribes to serve over 1 million American
  Indians and Alaska Natives.  It provides community services; operates schools or provides
  financial support to operate the schools; maintains law enforcement systems; provides social
  services; and assists in farming, ranching, forestry, and mining on reservations.  These services
  are provided directly by the Bureau and through contracts with over 500 tribes.
  
  The Bureau's appropriations provide the funding for operating the nontrust activities and the
  Bureau's costs for administering trust funds.  The Bureau plans to contract with a public
  accounting firm to audit the trust fund monies, which consist of tribal trust fund monies and
  individual Indian monies.
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Bureau of Indian Affairs financial statements for fiscal years 1996 and 1997
  that relate to nontrust activities. The audit will not include trust fund monies.  The objective
  of the audit is to determine whether:  (1) the financial statements were presented fairly and
  in accordance with applicable accounting standards; (2) internal controls were effectively
  implemented (that is, assurance was provided that the Bureau complied with applicable laws
  and regulations; safeguarded funds, property, and other assets against waste, loss,
  unauthorized use, or misappropriation; and properly recorded and accounted for revenues and
  expenditures); (3) the Bureau complied with applicable laws and regulations as required by
  generally accepted government auditing standards; (4) the internal control evaluation process
  was in compliance with the Federal Managers' Financial Integrity Act and Office of
  Management and Budget guidelines and requirements; and (5) the significant financial
  information in the overview was consistent with the financial statements and the systems
  providing data for the significant performance measures in the overview were reliable.
                               FACT SHEET
  
  
              THE INDIAN ESTATE PROBATE PROCESS,
                   BUREAU OF INDIAN AFFAIRS
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  Under the Act of June 25, 1910 (36 Stat. 855), and the Act of February 14, 1919 (37 Stat.
  678), the Secretary of the Interior was given statutory power to determine heirs and to
  approve wills in inheritance proceedings affecting restricted allotted lands and other restricted
  or trust property of deceased Indians.  Under Title 43, Section 4, of the Code of Federal
  Regulations, the Bureau of Indian Affairs is required to provide heirship data to the Office of
  Hearings and Appeals within 90 days of the death of an Indian.
  
  To eliminate backlogged Indian estate probate cases, the Bureau has requested and received
  additional funding.  Despite these additional resources, the Bureau reported in its fiscal year
  1996 budget justification that 2,246 pre-1991 probate cases still needed to be processed.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the program for processing Indian estate
  probate cases was administered effectively and in accordance with applicable rules and
  regulations.  The audit will review probate cases on file as of October 1, 1996, and any
  additional cases received during fiscal year 1997.
  
                               FACT SHEET
  
  
               LAND RECORDS MANAGEMENT SYSTEM,
                   BUREAU OF INDIAN AFFAIRS
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND 
  
  The Bureau of Indian Affairs has five Land Titles and Records offices, which are responsible
  for recording, imaging, adjudicating, certifying, and managing  all title documents, including
  leases, and all land title and ownership for Indian trust and restricted lands under the Bureau's
  jurisdiction.  The program offices provide title service to Bureau and Federal offices that
  deliver services to tribal and individual owners of trust and restricted lands and to those
  Federal, state, and private sector offices that rely on Land Titles and Records data and
  reports.  The Bureau is responsible for maintaining land ownership records for over 50 million
  acres of tribally and individually owned Indian lands.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau's land records management
  system ensured that land ownership records were accurate.  The scope of audit will review
    land, title, and encumbrance records for fiscal years 1995 and 1996.                           FACT SHEET
  
  
       IMPLEMENTATION OF THE INDIAN SELF-DETERMINATION
                 AND EDUCATION ASSISTANCE ACT,
                   BUREAU OF INDIAN AFFAIRS
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  The Indian Self-Determination and Education Assistance Act of 1974 authorized tribal
  governments and organizations to assume administration of Bureau of Indian Affairs
  programs under contracts, grants, and cooperative agreements.  Tribes that have had 3 years
  of successful experience under self-determination contracts are eligible to enter into self-
  governance agreements, which provide more flexibility to the tribes to administer their
  programs.
  
  In fiscal year 1995, 449 (81 percent) of the 554 Federally recognized Indian tribes entered
  into one or more self-determination contracts.  In addition, tribes also operated 97 (52
  percent) of the 187 elementary and secondary schools.  However, these agreements
  accounted for only 39 percent of all obligations made from the Operation of Indian Programs
  appropriation (self-governance compacts accounted for another 7 percent).  The Bureau
  continued to provide services to over one-half of the programs after more than 20 years of
  the initial change in Federal policy.
  
  The Secretary of the Interior's "Strategic Direction: 1996-2000" commits the Department to
  the transfer of Federal program operations to tribal governments through Indian self-determination and self-governance agreements.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine why more tribes have not been entering into self-determination contracts with the Bureau. 
                               FACT SHEET
  
  
  ADMINISTRATION OF INDIVIDUAL INDIAN MONEY 
                ACCOUNTS AT SELECTED AGENCIES,
                   BUREAU OF INDIAN AFFAIRS
  
  
  TYPE OF AUDIT
  
  Performance - selected agencies
  
  BACKGROUND
  
  On February 9, 1996, Secretarial Order 3197 transferred the Office of Trust Funds
  Management and other financial trust service functions from the Bureau of Indian Affairs to
  the Office of the Special Trustee, within the Office of the Secretary.  The Office of Special
  Trustee assumed all responsibility for Individual Indian Money accounts and financial trust
  fund activities, which include collecting, investing, transferring, disbursing, accounting for,
  and reconciling accounts.
  
  The Office of Special Trustee has approximately 175 employees at the Bureau's 12 area
  offices and 93 agency and field offices.  The agency and field offices are either on or near the
  reservations served.  The main function of the agency and field offices is to collect revenues
  from activities such as oil and gas leases, timber sales, and surface leases generated on Indian
  trust lands.  In addition, the agency and field offices establish and maintain Individual Indian
  Money accounts, transfer deposits from holding accounts to individual/tribal accounts, and
  act as the primary trustee for the Individual Indian Money accounts.
  
  As of September 30, 1995, there were 299,946 Individual Indian Money accounts, which had
  a total balance of approximately $503 million.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Individual Indian Money accounts were
  established and maintained in accordance with applicable laws and regulations.  The scope of
  the audit will be limited to Individual Indian Money transactions conducted during fiscal years
  1995 and 1996.
  
                          FACT SHEET
  
  
                 FIRE MANAGEMENT ACTIVITIES,
                   BUREAU OF INDIAN AFFAIRS
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  The Bureau of Indian Affairs is responsible for wildfire protection on over 50 million acres
  of Native American lands.  In carrying out these responsibilities, the Bureau cooperates with
  other Departmental bureaus and Federal, state, and local fire agencies to share scarce
  resources and minimize costs.  Also, certain Indian tribes have arranged, through contract or
  compact, to perform the Bureau's fire management activities on their reservations.  The
  Bureau's  fire program funds  are allocated from appropriations to the Bureau of Land
  Management for the Department's wildland fire management program.
  
  The fire management program consists of nonemergency and emergency activities, which are
  accounted for separately.  Nonemergency fire preparedness costs represent the predictable
  aspects of the Department's fire management program, such as the basic 40-hour workweek
  payroll costs of  fire suppression, support personnel and facilities, and aircraft availability. 
  Emergency fire suppression costs include the unpredictable  aspects of the fire program, such
  as overtime and hazard pay, wages of direct-hire emergency fire fighter personnel, and
  emergency costs to rehabilitate damages caused by wildfires. For fiscal year 1994, the Bureau
  incurred costs of $24.6 million for fire preparedness and  $21.0 million for emergency fire
  suppression.  For fiscal year 1995, the Bureau incurred costs of $24.0 million for fire
  preparedness and $29.8 million for emergency fire suppression.
  
  Funding requests for fire suppression activities are based on the average costs of the last
  10 years, with emergency contingency funds available when authorized by the President. 
  Funding requests for fire preparedness activities should be based on a process known as the
  Most Efficient Level, which represents the organizational structure, staffing, and funding level
  required to provide the most cost-effective fire program that also meets established fire
  suppression standards and land management objectives.  The process is also used by the
  U.S. Forest Service.  However, for  fiscal year 1995, the Bureau requested and received only
  77 percent of its Most Efficient Level amount.
  
  The general criteria applicable to the Bureau's fire management activities are the following: 
  (1) the National Indian Forest Resources Management Act of 1990 (25 U.S.C. 3101), which 
  provides the Bureau with authority for fire protection and suppression on Indian trust lands;
  (2) the Indian Self-Determination and Education Assistance Act of 1975 (Public Law 93-638), which  authorizes the contracting of Departmental programs with Indian tribes; (3) the
  Tribal Self Governance Act of 1994 (Public Law 103-413), which establishes a program
  known as tribal "self-governance"(which authorizes the compacting of Departmental 
  programs); and (4) Bureau of Indian Affairs Manual, Part  53, which defines the Bureau's fire
  management policies.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau: (1) was managing its wildland
  fire management activities in accordance with applicable laws, regulations,  and policies and
  (2) was properly using and accounting for emergency and nonemergency fire program
  funding.  The scope of the audit will include fire management-related activities that occurred
  at selected area and agency offices during fiscal years 1995 and 1996.
                               FACT SHEET
  
  
                  BUREAU OF LAND MANAGEMENT
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving financial management functions of the Office
  of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Bureau of Land Management was created in July 1946 through the consolidation of the
  General Land Office and the Grazing Service.  The Bureau's mission is to manage over
  270 million acres of public land and various related resources located in 28 states.  The
  Bureau also administers mineral leasing and supervises mineral operations on an additional
  300 million acres of Federal mineral estate underlying Federally administered state, Indian,
  or private ownerships throughout the United States.  
  
  During fiscal year 1996, the helium operation of the former Bureau of Mines was transferred
  to the Bureau of Land Management.
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Bureau of Land Management's financial statements for fiscal years 1996 and
  1997.  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Bureau complied with
  applicable laws and regulations; safeguarded funds, property, and other assets against waste,
  loss, unauthorized use, or misappropriation; and properly recorded and accounted for
  revenues and expenditures); (3) the Bureau complied with applicable laws and regulations as
  required by generally accepted government auditing standards; (4) the internal control
  evaluation process was in compliance with the Federal Managers' Financial Integrity Act and
  Office of Management and Budget guidelines and requirements; and (5) the significant
  financial information in the overview was consistent with the financial statements and the
  systems providing data for the significant performance measures in the overview were reliable.
  
                               FACT SHEET
  
  
               HAZARDOUS MATERIALS MANAGEMENT,
                  BUREAU OF LAND MANAGEMENT
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  Numerous activities take place on public lands managed by the Bureau of Land Management
  that require the use of hazardous materials or that generate hazardous wastes.  For example,
  oil and gas drilling operations, coal mining, and pesticide applications may contaminate water
  supplies or otherwise damage the environment and create a health risk to the public or to
  Bureau employees.  Additionally, hundreds of landfills and dumps, some of which contain
  toxic wastes, are located on Bureau-managed public lands.  Further, in some parts of the
  Nation, there is a significant problem with illegal trash and refuse dumping and with the
  dumping of industrial wastes and contaminants on public lands.  In recent years, there has
  been an increased awareness of the adverse effects and overall degradation that hazardous
  materials can have on public lands.  Because of this increased awareness, the Bureau has
  increased its efforts to reduce the impact that hazardous material releases have on these lands. 
  The Bureau's Hazardous Materials Management Program is the primary management tool
  used to address this area.
  
  The Program consists of four specific components: (1) preventing pollutants on managed
  lands; (2) reducing unavoidable generated wastes; (3) protecting the public, employees, and
  the natural resources from adverse effects of hazardous materials; and (4) responding to,
  cleaning up, and restoring damaged natural resources.
  
  The most costly of these components are the cleanup and the restoration of damages resulting
  from hazardous materials contamination.  However, during 1995, the Department established
  a Central Hazardous Materials Fund to provide a central account to contribute to the study
  and cleanup of significant hazardous material release sites.  The central account was
  established at a level of $13.4 million for 1995, and the amount was increased to $34.5 million
  for fiscal year 1996.  The Bureau was allocated $14 million from the central account for 1996,
  and the funds were to be used to pay for evaluation, study, and/or cleanup of 14 significant
    hazardous material release sites.    Additionally, the Bureau's budget for the Program for fiscal year 1996 was about $16.9
  million, and about 170 full-time staff were assigned to the Program.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau of Land Management was
  managing its Hazardous Materials Management Program effectively.  Specifically, the audit
  will determine whether the Bureau:  (1) identified potential hazardous waste sites; (2)
  protected public health and safety on Bureau-managed lands that may have contained
  hazardous materials; (3) protected the natural resources on public lands from the effects of
  hazardous materials introduced on those lands; (4) made efforts to minimize the liability and
  costs associated with hazardous materials on the public lands; (5) made efforts to investigate,
  study, and/or clean up Bureau-managed sites that contained hazardous materials; and (6)
  made efforts to provide required hazardous materials awareness and operational safety
  training to Bureau employees.  The scope of the audit will be Program activities that occurred
  during fiscal years 1994 through 1996.  Some audit work may be required at other
  Departmental land managing agencies, since some Program initiatives are cooperative efforts
  among various agencies, and at the Department's Office of Environmental Policy and
  Compliance, which has responsibility for managing the environmental-related activities of the
  Department, including hazardous materials.
  
                               FACT SHEET
  
  
               FIRE-FIGHTING SAFETY MANAGEMENT,
                  BUREAU OF LAND MANAGEMENT
  
  
  TYPE OF AUDIT
  
  Performance - intra-Departmental
  
  BACKGROUND
  
  The National Interagency Fire Center, the Nation's logistical support center for wildfire
  suppression, was formed in 1965 from an effort by the Bureau of Land Management and the
  U.S. Forest Service to improve fire and aviation support throughout the Great Basin and the
  Intermountain West.  This effort to pool resources proved to be highly effective, and, as a
  result, the U.S. Fish and Wildlife Service, the National Park Service, and the Bureau of Indian
  Affairs joined in using the Center in the 1970s.  These Federal land management agencies
  share fire-fighting supplies, equipment, facilities, and personnel to make the wildland fire-fighting task more efficient and cost effective.  Each agency is responsible for the safety
  training of its fire fighters.
  
  As a result of a severe fire-fighting season in 1994, which included a wildfire in Colorado that
  killed 14 fire fighters, the Department of Agriculture, the Department of the Interior, the
  Occupational Safety and Health Administration, and numerous other smaller agencies issued
  the "Federal Wildland Fire Management Policy and Program Review Final Report," dated
  December 18, 1995.  This review was chartered by the Secretaries of Agriculture and Interior
  to ensure that Federal fire-fighting policies and programs are uniform, cooperative, and
  cohesive.
  
  One of the key points affecting fire-fighting policy is the need to protect human life, which
  the "Review Report" reaffirmed as the first priority in wildland fire management, with the
  protection of property and natural and cultural resources jointly identified as the second
  priority.  The investigative reports of the fatal 1994 Colorado fire indicated that a lack of
  communication, resources, and cooperation were some of the major deficiencies found to
  have led to the fire fighters' deaths.  Additional fire fighter deaths occurred in Arizona and
  New Mexico in 1994, and these fatalities were also attributed to deficiencies similar to those
  attributed to the Colorado fire.  Department of the Interior appropriations for fire fighting 
  for fiscal year 1996 were $235.9 million, with a proposed increase to $247.9 million for fiscal
  year 1997.
  
  
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau of Land Management was
  operating the fire-fighting safety program effectively.  Specifically, we will determine whether: 
  (1) the new Departmental (interbureau) fire-fighting policies and procedures have  been
  effective; (2) communications and coordination efforts have been improved between all fire
  management resources; (3) additional fire-fighting safety training has been initiated as a result
  of the 1994 fires; and (4) a system of accountability has been established within the fire-fighting community.  The scope of the audit will be operation of the fire-fighting safety
  program for fiscal years 1994 through 1996.  The audit fieldwork will be conducted during
  the fire "off season," generally during the winter and spring months, to have the least impact
  on fire-fighting operations.  We will also review fire-fighting safety programs in the U.S. Fish
  and Wildlife Service, the National Park Service, and the Bureau of Indian Affairs because of
  the cooperative arrangement of fire-fighting coverage within the Department.  Some review
  and comparison of the coordination efforts of the U.S. Forest Service may also be warranted.
  
                               FACT SHEET
  
  
              TIMBER ACTIVITIES ON PUBLIC LANDS,
                  BUREAU OF LAND MANAGEMENT
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  The Bureau of Land Management has approximately 8.9 million acres of commercial forest
  land and an additional 35.5 million acres of woodlands under its  jurisdiction.  Commercial
  forest lands are defined by the Bureau as the primary source of commercial sawlogs, yielding
  more than 20 cubic feet per acre per year, while woodlands yield less than 20 cubic feet per
  acre per year.  Forest vegetation has a significant impact on many resources.  The density and
  structure of forest cover influence land use by many forms of animal and plant life. 
  Historically, factors of nature such as fire, insects, and climate played important roles in either
  maintaining or changing the influence of forest vegetation on the environment.  Through use
  of forest management practices, managers can closely replicate these factors of nature to
  accomplish planning objectives
  
  Drought conditions over the past several years have increased the occurrence of forest
  wildfires and the subsequent effects of death of trees.  The drought conditions also
  contributed significantly to the occurrence and severity of insect outbreaks.  In order to
  minimize the loss of saleable timber and to improve forest  conditions, the Bureau has placed
  priority on the salvage of timber in areas that have been adversely impacted by fires and
  insects.  
  
  In 1993, the Forest Ecosystems Health and Recovery Fund was established to promote forest
  conditions, including salvage and reforestation efforts.  The Federal share of receipts from the
  disposal of salvage timber from lands under the jurisdiction of the Bureau is deposited into
  a special fund in the U.S. Treasury.  This fund allows the Bureau to prepare salvage timber
  for disposal, administer sales of salvage timber, and plan for subsequent site preparation and
  reforestation.  Since the inception of this fund in fiscal year 1993, the Bureau has collected
  about $17.1 million and expended about $7.1 million, leaving a fund balance of about $10
  million as of June 30, 1996.  The 1996 budget estimate was $2.5 million, which equals the
  Federal share of receipts collected for 1996.
  
  The Bureau has estimated, in its timber trespass and theft report records, that the loss from
  timber theft on Bureau lands in Oregon and Washington totaled about 500,000 board feet
  annually.  This estimate may be low, given the fact that some timber thefts are undetected for
  extended periods of time because of the size and remote locations of the timber lands under
  the Bureau's administration.
  
  When theft is detected, a citation may be issued.  If the citation does not resolve the issue, the
  Bureau may seek prosecution through the U.S. Attorney's Office.  In its fiscal year 1996
  budget testimony, the Bureau stated that it is addressing "the most significant known cases"
  within its available resources and is attempting to prevent the timber theft problem from
  becoming widespread through its "management efforts."  However, there are indications that
  these efforts have had limited success because many cases are settled either through
  negotiation for unrealistically low amounts or are simply written off because the U.S.
  Attorney's Office has declined prosecution.  Some Bureau officials believe that because of
  these factors, further timber theft has not been deterred. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau of Land Management was
  adequately planning for the sale of fire-killed and diseased timber and was preventing timber
  thefts that occur on public lands under its jurisdiction.   To accomplish our objective, we will
  review the Bureau's sales preparation activities, including sales layout, access acquisition,
  road design, appraisals, economic assessments, contract preparation, and sales advertising. 
  We will also review sales administration activities, including how the sales are conducted and
  how the contracts are awarded and administered.  In addition, we will review the Bureau's
  detection, investigation, and prosecution of  timber thefts.   
  
                               FACT SHEET
  
                               
       LAND USE PLANNING UNDER THE FEDERAL LAND POLICY
                 AND MANAGEMENT ACT OF 1976,
                  BUREAU OF LAND MANAGEMENT
                                
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  The Departmental Manual (Part 135) states that the Bureau of Land Management is
  responsible for the balanced management of public lands and resources and their various
  values so that they are considered in a combination that will best serve the needs of the
  American people.  Management is based upon the principles of multiple use and sustained
  yield, which are a combination of uses that take into account the long-term needs of future
  generations for renewable and nonrenewable resources.  These resources include areas for
  recreation, rangeland, timberland, minerals, watershed, and fish and wildlife  and wilderness 
  areas that have natural, scenic, scientific, and cultural values.  
  
  Further, the use of public lands is to be provided for, by tracts or areas, through the
  development, maintenance, and revision of land use plans.  The Departmental Manual requires
  that such plans be prepared with public involvement; be consistent with existing legislation;
  and be for public lands regardless of whether the lands have previously been classified,
  withdrawn, set aside, or otherwise designated for one or more uses.   
  
  The Federal Land Policy and Management Act of 1976 (Public Law 94-579) established a
  land use planning process known as resource management planning. This planning process,
  which promotes multiple use and sustained yield, is designed to serve the needs of all public
  land users.  The Bureau's 1997 budget justification stated that land use plans, such as
  resource management plans, provide a guide for Bureau land use and resource management
  decisions  in that they:
  
    - Improve the Bureau's ability to identify and assess changing natural resource
  conditions and new public land uses systematically.
  
    - Enhance the ability of the Bureau's managers to resolve natural resource issues and
  land use conflicts affecting public lands.
  
    - Promote coordination and consistency with the plans of other Federal agencies and
  state, local, and tribal governments.
  
    - Facilitate public participation in public lands management and planning. 
  
    - Facilitate compliance with statutory mandates, including the Federal Land Policy and
  Management Act of 1976 and the National Environmental Policy Act.
    
  The Bureau's existing land use plans, which cover approximately 98 percent of Bureau-administered lands (excluding Alaska), consist of a mix of management framework plans and
  resource management plans.  Management framework plans, which are  older land use plans,
  were prepared in accordance with the Federal Land Policy and Management Act but are not
  required under the current planning regulations (43 CFR 1600).  In 1997, the Bureau is
  expected to complete 11 resource management plans,  and by the end of 1997, the Bureau
  will maintain 116 resource management plans.  The Bureau requested, in its fiscal year 1997
  budget for resource management planning, $8.54 million and 167 full-time equivalent
  employees.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau of Land Management's
  planning, implementing, and monitoring processes as they relate to the multiple use of land
  were in compliance with Departmental and Federal guidelines. The audit will be a Bureauwide
  review and will include a judgmental sample of land management planning documents.
  
                               FACT SHEET
  
  
                 MINERALS MANAGEMENT SERVICE
                     FINANCIAL STATEMENTS
                FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The mission of the Minerals Management Service consists of two major objectives:  (1) to
  collect, distribute, account for, and timely and accurately audit  revenues owed by holders of
  Federal and Indian mineral leases and (2)  to manage the leasing, development, and
  production of mineral resources on the Outer Continental Shelf in an environmentally sound
  and safe manner.
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Minerals Management Service's financial statements for fiscal years 1996
  and 1997.  The objective of the audit is to determine whether:  (1) the financial statements
  were presented fairly and in accordance with applicable accounting standards; (2) internal
  controls were effectively implemented (that is, assurance was provided that the Service
  complied with applicable laws and regulations; safeguarded funds, property, and other assets
  against waste, loss, unauthorized use, or misappropriation; and properly recorded and
  accounted for revenues and expenditures); (3) the Service complied with applicable laws and
  regulations as required by generally accepted government auditing standards; (4) the internal
  control evaluation process was in compliance with the Federal Managers' Financial Integrity
  Act and Office of Management and Budget guidelines and requirements; and (5) the
  significant financial information in the overview was consistent with the financial statements
  and the systems providing data for the significant performance measures in the overview were
    reliable.                           FACT SHEET
  
  
                BIENNIAL AUDIT OF THE FEDERAL
                 ROYALTY MANAGEMENT SYSTEM, 
                 MINERALS MANAGEMENT SERVICE
  
  
  TYPE OF AUDIT
  
  Mandatory - Servicewide
  
  BACKGROUND
  
  The Federal Oil and Gas Royalty Management Act of 1982 requires the Inspector General to
  conduct a biennial audit of the Federal Royalty Management System and to report the results
  to the Congress and the Secretary of the Interior.  Six biennial reports have been issued.  This
  audit data sheet provides the framework for the biennial audit requirement for fiscal years
  1996 and 1997.
  
  The Royalty Management System is composed of activities managed by the Minerals
  Management Service, the Bureau of Land Management, and the Bureau of Indian Affairs. 
  Most of the royalty management functions and responsibilities are assigned to the Royalty
  Management Program of the Minerals Management Service.  The overall mission of the
  Royalty Management Program is to ensure proper determination, collection, and distribution
  of bonuses, rents, and royalties from Federal and Indian lands in a manner that maximizes
  incentives for the efficient management, production, and use of oil, gas, coal, and other
  mineral resources consistent with public health and safety, environmental, and public land use
  requirements.  Additionally, the Minerals Management Service is responsible for monitoring
  production from offshore Federal leases located in the Outer Continental Shelf, whereas the
  Bureau of Land Management monitors production from onshore Federal and Indian leases. 
  Further, the Bureau of Indian Affairs distributes minerals revenues to individual Indians and
  tribes.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Department of the Interior has
  complied with the Federal Oil and Gas Royalty Management Act of 1982.  The audit will
  cover Royalty Management System activities that occurred during fiscal years 1996 and 1997.
                          FACT SHEET
  
  
          SELECTED ASPECTS OF THE OUTER CONTINENTAL
                     SHELF LANDS PROGRAM,
                 MINERALS MANAGEMENT SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - Servicewide
  
  BACKGROUND
  
  The Outer Continental Shelf Lands Program is the largest activity of the Minerals
  Management Service, which, for fiscal year 1995, had a budget of $87.3 million and had 868
  full-time equivalent employees.  The Program is responsible for determining whether the
  Nation's energy and nonenergy mineral resources located in the Outer Continental Shelf can
  be developed in an environmentally sound manner and, if leased, to ensure human safety and
  protect the environment.  Since offshore leasing began in 1954, over 115 lease sales,
  generating over $105 billion in rents, bonuses, and royalties, have been conducted.
  
  The Program's budget activity consists of  the following five major subactivities:
  
    -The Leasing and Environmental Program, which provides for oil and gas leasing
  activities on the Outer Continental Shelf and for post-lease monitoring to ensure compliance
  with environmental regulations.
  
    -The Resource Evaluation Program, which acquires and analyzes various geologic,
  geophysical, and other scientific data and information to support decisions affecting the Outer
  Continental Shelf Lands Program.
  
    -The Regulatory Program, which regulates offshore mineral exploration, development,
  and production operations to protect human safety and the environment, as well as to
  conserve natural resources.
  
    -The Information Management Program, which  provides computer support for the
  regional offices.
  
  
    - The Office of Management Support, which provides technical ADP support, budget
  execution and reporting, and administrative support for the offshore program.
  
  The Service's Office of Offshore Minerals Management administers the Outer Continental
  Shelf Lands Program.  The headquarters offices are located in Herndon, Virginia, and
  Washington, D.C., and the three regional offices are located in Anchorage, Alaska; Camarillo,
  California; and New Orleans, Louisiana.  The Outer Continental Shelf Mapping and Survey
  Staff offices are in Denver, Colorado.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether:  (1) selected activities of the Outer
  Continental Shelf Lands Program were operated economically, efficiently, and effectively and
  (2) the Program has been in compliance with applicable laws and regulations and Service
  policies and procedures.  The scope will cover Program activities that occurred during fiscal
  years 1995 and 1996.  Our initial review will consist of evaluating the bonding program for
  offshore leases.  Other activities will be selected for review based on the results of ongoing
  audits and in consultation with Service officials.
  
                               FACT SHEET
  
           FOLLOWUP OF ROYALTIES ON TAX CREDITS FOR
                    NONCONVENTIONAL FUELS,
                 MINERALS MANAGEMENT SERVICE
  
  
  TYPE OF AUDIT
  
  Performance - multi-agency
  
  BACKGROUND
  
  Nonconventional fuels include gas produced from coal seams and tight geological formations. 
  The Congress provided a subsidy to encourage development of the fuels to the stage where
  they could be competitive with conventional fuels. The Minerals Management Service has
  never assessed or collected royalties on the value of tax credits for conventional fuels.  The
  value of the tax credit has been approximately equal to the selling price of the gas in recent
  years; therefore, the total value of these nonconventional fuels is about twice the value of
  conventional fuels.  In our August 1993 audit report on tax credits for nonconventional fuels
  earned from gas produced on Federal and Indian leases, we stated that if the Service had
  required lessees to pay royalties on these tax credits, it could have collected additional
  revenues estimated at $74 million during 1989 through 1992.  We estimated that potential
  additional royalty revenues of at least $210 million would be available over the next 10 years
  through an aggressive collection program based on  production remaining at the 1992 level. 
  Further, because of expected increases in future gas production, the potential revenues have
  increased rapidly since 1993 and are expected to continue to increase rapidly through 2002,
  when the tax credit expires. 
  
  In 1993, the Internal Revenue Service issued a revenue ruling which provided that owners 
  of royalty interests are allowed an allocable share of the nonconventional fuels tax credit. 
  Also in 1993, as a result of our prior audit, the Minerals Management Service obtained a
  Solicitor's opinion which stated that tax credits for nonconventional fuels were not part of
  gross proceeds and therefore were not royalty bearing.  In a November 1995 development,
  the State of New Mexico initiated a program to "monetize" (sell the rights to the tax credits
  to a third party) its royalty interest from nonconventional fuels from state leases by auctioning
  off the royalty interests.  This plan was approved by the Internal Revenue Service.  The
  Solicitor's opinion, that the tax credits are not royalty bearing, does not appear to be
  consistent with the revenue ruling and the New Mexico program to monetize the royalty
  interest.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether: (1) the Minerals Management Service has
  a program to match production reported for royalty purposes with production reported for
  Federal income tax purposes and (2) producers can be required, if  no such program exists,
  to provide tax return information as a provision of their lease or by a rule making.  We will
  also review the circumstances of the New Mexico program as they relate to the 1993
    Solicitor's opinion.                           FACT SHEET
  
  
                   OFFICE OF SURFACE MINING
                 RECLAMATION AND ENFORCEMENT
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Office of Surface Mining Reclamation and Enforcement was established on August 3,
  1977, and has two major functions:  (1) to regulate current surface coal mining operations to
  ensure protection of the environment during mining and reclamation of the land after the coal
  is extracted and (2) to repair lands affected by past coal mining operations that were
  unreclaimed and abandoned before the 1977 surface mining law was enacted.  States are
  essentially responsible for regulating surface mining.  Surface Mining reviews and approves
  the states' regulatory programs and provides technical assistance to help the states perform
  their responsibilities under the surface mining law.
  
  While current mining operations are now required to reclaim the land as mining is completed,
  Surface Mining also works to reclaim lands that were mined before the surface mining law
  was passed.  Surface Mining collects reclamation fees from current mining operations for the
  repair of those abandoned mine sites.  Under the surface mining law, the reclamation funds
  are allocated to:  (1) states that have approved regulation programs (50 percent of the funds);
  (2) the Rural Abandoned Mine Program ($12 million annually); (3) the Small Operator
  Assistance Program (amount varies annually); and (4) Surface Mining (the remainder, nearly
  50 percent) to respond to environmental emergencies caused by abandoned mines.  
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Office of Surface Mining Reclamation and Enforcement's financial
  statements for fiscal years 1996 and 1997.  The objective of the audit is to determine whether: 
  (1) the financial statements were presented fairly and in accordance with applicable
  accounting standards; (2) internal controls were effectively implemented (that is, assurance
  was provided that Surface Mining complied with applicable laws and regulations; safeguarded
  funds, property, and other assets against waste, loss, unauthorized use, or misappropriation;
  and properly recorded and accounted for revenues and expenditures); (3) Surface Mining
  complied with applicable laws and regulations as required by generally accepted government
  auditing standards; (4) the internal control evaluation process was in compliance with the
  Federal Managers' Financial Integrity Act and Office of Management and Budget guidelines
  and requirements; and (5) the significant financial information in the overview was consistent
  with the financial statements and the systems providing data for the significant performance
  measures in the overview were reliable.
                               FACT SHEET
  
  
                   FEE COMPLIANCE PROGRAM,
           OFFICE OF SURFACE MINING RECLAMATION AND
                         ENFORCEMENT
  
  
  TYPE OF AUDIT
  
  Performance - Officewide
  
  BACKGROUND
  
  The Surface Mining Control and Reclamation Act of 1977 (Public Law 95-87), as amended,
  provides for the restoration of  mine lands abandoned before August 3, 1997, that were
  restored inadequately.  Coal producers pay fees of 35 cents per ton of surface-mined coal, 15
  cents per ton of coal mined underground, and 10 cents per ton of lignite.  These fees are
  deposited into the Abandoned Mine Reclamation Fund.  Appropriations from this fund are
  used to make grants to states and tribes for the reclamation of abandoned mine lands and to
  fund Surface Mining Reclamation and Enforcement reclamation projects on Federal and non-Federal lands.
  
  Surface Mining's Compliance Management Division conducts audits to ensure that the
  payments of reclamation fees are accurate.  The Division had a staff of 51 employees and an
  operating budget of $3.5 million in fiscal year 1996.  In 1995, the Division issued 356 audit
  reports, which identified $5.4 million of underreported or unreported reclamation fees and
  related interest, penalties, and administrative charges, and collected $2.4 million of audit-identified reclamation fees and related charges.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Surface Mining's Compliance Management
  Division performed audits of coal mining companies in an efficient and effective manner and
  operated in compliance with applicable Federal, Department of the Interior, and Surface
  Mining regulations.  The audit will cover the Division's fee compliance activities that
  occurred during fiscal years 1995 and 1996.
                               FACT SHEET
  
  
                   ADMINISTRATION OF STATE 
                  REGULATORY GRANT PROGRAMS,
                   OFFICE OF SURFACE MINING
                 RECLAMATION AND ENFORCEMENT
  
  
  TYPE OF AUDIT
  
  Performance - Officewide
  
  BACKGROUND
  
  Under the Surface Mining Control and Reclamation Act of 1977, 24 states currently have
  programs approved by the Secretary of the Interior to regulate coal mining activities.  The
  state programs are funded through grants issued by the Office of Surface Mining Reclamation
  and Enforcement and include the review and issuance of mining permits, inspection and
  enforcement, designation of lands unsuitable for mining, administration of bonding and bond
  release programs that ensure proper reclamation of land after mining, and administration of
  small operator assistance programs.  In addition, some states that are authorized to perform
  the regulatory functions on Federal lands within state boundaries also receive funding through
  cooperative agreements with Surface Mining. 
  
  In its fiscal year 1996 budget justification, Surface Mining requested $46.4 million for
  regulatory program grants to 24 states that have approved permanent regulatory programs
  (primacy) and $5.2 million for cooperative agreements with 11 states that have approval to
  operate regulatory programs on Federal lands.  According to the Act, grants to states
  currently cannot exceed 50 percent of total annual state costs, and the Federal share of
  cooperative agreements is limited to the amount the Federal Government would have to
  spend to perform the same work.  The budget justification also showed that the States of
  Illinois, Kentucky, Ohio, Pennsylvania, Virginia, and West Virginia received $38.2 million,
  or 74 percent, of the total $51.6 million of Federal funding provided.
  
  In response to our request for audit suggestions for our fiscal year 1996 audit workplan,
  Surface Mining requested that the grants function be audited.  Specifically, Surface Mining
  said that it had a team that was studying ways to streamline the entire grants process and to
  reduce the number of personnel devoted to the grants function.  Surface Mining further said
  that it was requesting the audit of the grants process to ensure that the streamlining effort
  does not "decrease controls over the grants award, monitoring, closeout, and audit function." 
  Although we initiated the audit in fiscal year 1996, we determined that it was too soon to
  evaluate the effects of the reorganization and downsizing of the grants function at that time. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Surface Mining was administering the state
  regulatory grant programs efficiently and effectively  and in accordance with applicable
  regulations and whether the state regulatory programs were being operated efficiently and
  effectively and in accordance with grant agreements.  The scope of the audit is program
  activities that occurred during fiscal years 1995 and 1996.
                               FACT SHEET
  
  
             ADMINISTRATION OF STATE RECLAMATION 
                       GRANT PROGRAMS,
                   OFFICE OF SURFACE MINING
                 RECLAMATION AND ENFORCEMENT
  
  
  TYPE OF AUDIT
  
  Performance - Officewide
  
  BACKGROUND
  
  Under the Surface Mining Control and Reclamation Act of 1977, grants are provided to states
  and Indian tribes that have reclamation programs approved by the Office of Surface Mining
  Reclamation and Enforcement.  The grants are used to address problems such as underground
  fires, subsidence, landslides, open shafts, unstable or burning refuse piles, acid mine drainage,
  and highwalls.  Funding for the grants and for the cost of Surface Mining's related monitoring
  and technical assistance is derived from the Abandoned Mine Reclamation Fund, which
  consists primarily of monies obtained from reclamation fees paid by coal operators.
  
  In its budget justification for fiscal year 1996, Surface Mining requested $145.6 million for
  reclamation program grants to 23 states and 3 Indian tribes.  The budget justification also
  included a request for $13.3 million for reclamation program operations.  These operations
  included funding for reclamation program grant management and technical assistance, as well
  as the management of emergency projects for states that did not have approved programs.
  
  In response to our request for audit suggestions for our fiscal year 1996 audit workplan,
  Surface Mining said that it had streamlined the grants process in fiscal year 1993 and that it
  was reviewing additional ways to reduce the number of personnel who were performing the
  grants function.  Surface Mining said that it was requesting an audit of the grants process to
  ensure that the streamlining effort does not "decrease controls over the grant award,
  monitoring, closeout, and audit function."  Although we initiated the audit in fiscal year 1996,
  we determined that it was too soon to evaluate the effects of the reorganization and
  downsizing on the grants function at that time.
  
  
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Surface Mining was  administering its state
  reclamation grant programs efficiently and effectively and in accordance with applicable
  regulations and whether the state reclamation programs were being operated efficiently and
  effectively and in accordance with grant agreements.  The scope of the audit will be program
  activities that occurred during fiscal years 1995 and 1996.
                               FACT SHEET
  
  
                    BUREAU OF RECLAMATION
     FINANCIAL STATEMENTS FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The Reclamation Act of 1902 (43 U.S.C. 391 et. seq.) authorized the Secretary of the Interior
  to locate, construct, operate, and maintain works for water storage, diversion, and
  development in the 17 western states.  The Bureau of Reclamation is composed of five
  regional offices and the Commissioner's offices in Washington, D.C., and Denver, Colorado.
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Bureau of Reclamation's financial statements for fiscal years 1996 and
  1997.  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Bureau complied with
  applicable laws and regulations; safeguarded funds, property, and other assets against waste,
  loss, unauthorized use, or misappropriation; and properly recorded and accounted for
  revenues and expenditures); (3) the Bureau complied with applicable laws and regulations as
  required by generally accepted government auditing standards; (4) the internal control
  evaluation process was in compliance with the Federal Managers' Financial Integrity Act and
  Office of Management and Budget guidelines and requirements; and (5) the significant
  financial information in the overview was consistent with the financial statements and the
  systems providing data for the significant performance measures in the overview were reliable.
                          FACT SHEET    
  
              RENEWAL OF CENTRAL VALLEY PROJECT 
  LONG-TERM WATER SERVICE CONTRACTS,
                    BUREAU OF RECLAMATION
  
  
  TYPE OF AUDIT
  
  Performance - single location
  
  BACKGROUND
  
  The Central Valley Project in California was authorized in 1935 and is the Bureau of
  Reclamation's largest multipurpose water project.  It is an integrated network that includes
  20 reservoirs, with a combined storage capacity of about 12 million acre-feet; 8 power  plants; 
  2 pumping-generating plants, with a maximum capacity of about 2 million kilowatts; and over
  500 miles of major canals.  The Project was designed and has been operated primarily to
  provide flood control, water for irrigation and municipal and industrial use, and power
  generation.  
  
  The Project provides water through 258 water service contracts for irrigation of about
  3 million acres of farmland, as well as water to more than 2 million urban residents and to
  Federal, state, and private wildlife refuges.  Water service contracts establish the amount of
  water that is to be made available and delivered to contractors and the rates the contractors
  pay for each acre-foot of water.  The contracts set forth rates for the following: repayment
  of the Federal investment in the Project, prior years' operating deficits, operation and
  maintenance of facilities, irrigation and municipal and industrial use, and mitigation and
  restoration assessments.  
  
  Section 3404(c) of the Central Valley Project Improvement Act (Title 34 of Public Law 102-575) provides that Project long-term water service contracts existing on October 30, 1992,
  will be renewed upon request for a period of 25 years once an environmental impact
  statement has been completed.   Section 3409 of the Act required the Secretary of the Interior
  to prepare and complete, by October 30, 1995, a  programmatic environmental impact
  statement,  pursuant to the National Environmental Policy Act, to analyze the direct and
  indirect impacts and benefits of implementing the Act, including all fish, wildlife, and habitat
  restoration actions and the potential renewal of all existing Project water contracts. 
  Completion of the environmental impact statement has been postponed until January 31,
  1997.
  
  Water service contracts that expire before the required environmental impact statement is
  completed can be renewed for an interim period not to exceed 3 years and for successive
  periods of not more than 2 years.  Once the statement has been completed, interim contracts
  are eligible for long-term renewal for successive 25-year periods.  To encourage early renewal
  of existing contracts, the Secretary  is directed, under Section 3404(c)(3) of the Act, to
  impose an additional mitigation and restoration payment of 1 1/2 times the annual mitigation
  and restoration payment on contractors that did not renew contracts by October 1, 1995, or
  January 1 of the year following the year in which the environmental impact statement is
  completed.  
  
  The Bureau has developed an action plan, "Environmental Compliance for Renewal of Long-Term Water Service Contracts in the Central Valley Project," which includes  a basic contract
  model to address individual contractor requirements.  From December 1994 to March 1996,
  the Bureau executed 54 interim contracts.  These 54 contracts and an additional 157 long-term water service contracts are eligible for renewal within the next 5 years.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau's policy for the renewal of
  long-term water service contracts is in compliance with the Central Valley Project
  Improvement Act and protects the Government's financial interests in the Project.  The audit
  will include an evaluation of the Bureau's interim, short-term contract renewal process.  The
  scope of the review will include policies and procedures that were in effect after the Act was
  passed.
                               FACT SHEET
  
  
  ENVIRONMENTAL MITIGATION AND ENHANCEMENT COSTS
      ASSOCIATED WITH PREVIOUSLY CONSTRUCTED FACILITIES,
  BUREAU                OF RECLAMATION
  
  
  TYPE OF AUDIT
  
  Performance - Bureauwide
  
  BACKGROUND
  
  Environmental mitigation and enhancement efforts on Bureau of Reclamation projects have
  increased over the years as awareness of the effects of projects on the  environment has
  grown.  Although such efforts have been applied to projects as they were constructed, the
  Bureau has also applied these efforts to projects that were constructed before the current level
  of environmental awareness.  Generally, environmental mitigation involves  activities  required
  by law or regulation for project construction and/or operation.  Environmental enhancement
  involves activities that, while not required by law or regulation, benefit wildlife in and around
  project areas.  According to the Bureau's fiscal year 1997 budget justification, Bureau 
  programs have evolved from projects that  emphasized  irrigation and hydropower generation
  to projects that serve a range of other uses:  urban needs, Indian self-sufficiency, fish and
  wildlife protection, endangered species recovery, recreation,  and environmental restoration. 
  
  
  With increasing frequency, the operation and the maintenance of older Bureau  projects are 
  being changed to respond to environmental concerns and operating criteria that were not
  envisioned when the projects were constructed.  Such changes may be required by
  Reclamation Law and instructions; Federal, state, or local environmental protection directives;
  or court orders.  This process can affect the computations of construction repayment and
  operation and  maintenance costs and have financial ramifications for the Government  and 
  project water and power beneficiaries.   Reclamation Law and instructions, project
  authorizing legislation,  and specific project repayment and operation and  maintenance
  contracts define how project costs are to be allocated and financed.  In the past, Reclamation
  Law has provided that the environmental mitigation and enhancement costs were
  nonreimbursable, although some recent project legislation has required that the project water,
  power, and other beneficiaries bear a portion of these costs.  However, project water and
  power beneficiaries have taken the position that the Federal Government should absorb all
  environmental mitigation and enhancement costs as part of the nonreimbursable portion of
  repayment of operation and maintenance costs.  This view seemingly does not recognize that
  these mitigation efforts can also work to the benefit of the water and power beneficiaries by
  eliminating the need to reduce or divert a project deliverable, such as water, to ease the
  negative effects the project is having on fish and wildlife.  
  
  In addition, changes in project operation caused by increased environmental awareness have
  been accompanied by new perspectives of how previously planned project operation and
  maintenance activities may affect the project areas. This may lead to project beneficiaries'
  seeking changes in the original allocation/repayment agreements  to lower their repayment or
  operation and maintenance obligations.   For example, on the Columbia Basin Project, a
  number of retention reservoirs that  were developed to provide for a stable and adequate
  irrigation water supply for farmers have, over the years, become populated with fish and  are
  being used by birds and other wildlife.  However, even these wildlife benefits are coincidental,
  and no costs were actually incurred to provide them.  Project irrigators have reportedly been
  requesting the Bureau to allocate more of the repayment and/or operation and maintenance
  costs as nonreimbursable under the fish and wildlife mitigation function of the project.  
  
  Based on our review of the Bureau's fiscal year 1997 budget justification, we found that
  about $60 million in proposed budget authority was requested for environmental mitigation
  and/or enhancement activities at previously constructed facilities.  A portion of this amount
  was previously recognized as part of the overall project development plans produced during
  project construction, while other portions of this amount are related to environmental
  mitigation and/or enhancement efforts initiated after project construction.  However, these
  environmental mitigation costs are currently required by law or regulation and may provide
  some benefits to project water and power beneficiaries regardless of whether such costs were
  planned as part of project development plans or were added after the projects were 
  constructed. Thus, some or all of these costs should be eligible for cost recovery as part of
  the operating "overhead" of the projects either through repayment or through operation and
  maintenance assessments.  Although some of these costs (such as those funded by the Central
  Valley Project Restoration Fund) are partially financed by beneficiary surcharges and
  donations, many of these costs are borne by the Federal Government.  Recovering these costs
  from benefiting water and power recipients would be in consonance with the
  Governmentwide initiatives to recover costs from project beneficiaries and, in this regard, 
  would place the water and power users on the same level as private sector businesses, which
  are required to comply with current environmental requirements as they pertain to the
  businesses' older facilities.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Bureau of Reclamation policies and
  procedures for allocating and funding construction and annual operation and maintenance
  costs associated with the environmental mitigation and enhancement activities on previously
  constructed reclamation projects were adequate to protect the Federal Government's financial
  interests in the projects.  Specifically, we will determine:  (1) the extent to which previously
  constructed facilities were incurring unanticipated environmental mitigation or enhancement
  costs; (2) the amount of unanticipated environmental mitigation or enhancement costs borne
  by the Federal Government; and (3) how such costs could be collected from project water,
  power, or other beneficiaries.  The scope of the review will be limited to those projects in
  operation 25 years or longer that  have had costs incurred for construction or operation and
  maintenance activities associated with environmental mitigation or enhancement that occurred
  during the last 2 fiscal years.
                               FACT SHEET
  
  
         PROGRAMMATIC ENVIRONMENTAL IMPACT STATEMENT,
           CENTRAL VALLEY PROJECT IMPROVEMENT ACT,
                    BUREAU OF RECLAMATION
  
  
  TYPE OF AUDIT
  
  Performance and financial related - Bureauwide
  
  BACKGROUND
  
  The Central Valley Project in California is a system of reservoirs, power plants, and canals
  managed by the Bureau of Reclamation.   The combined storage capacity is about 12 million
  acre-feet of water, which account for approximately 25 percent of California's developed
  surface water supply.  The Project irrigates approximately 3 million acres of farmland and
  provides water to more than 2 million urban residents, as well as to wildlife refuges. 
  
  The Central Valley Project Improvement Act, Title 34 of Public Law 105-575, signed into
  law on October 30, 1992, is the most significant legislation affecting the operation of the
  Central Valley Project in over 50 years.  The Act  strengthens existing fish and wildlife
  benefits of the Project by adding fish and wildlife mitigation, protection, and restoration as
  an authorized Project purpose. Section 3409 of the Act requires the preparation of a
  programmatic environmental impact statement that discloses the impacts resulting from
  implementation of the requirements of the Act.  Under the Act, the Congress requires that: 
  (1) specific fish and wildlife measures be implemented to reverse the decline of fish and
  wildlife populations and habitat; (2) existing water contracts, which generate approximately
  $85 million a year in revenue (including Restoration Fund collections), be renewed and
  administered in conformance with the requirements and goals of the Act; and (3)  programs
  to improve water management and water-related benefits, such as water transfer,
  conservation, and pricing measures, be developed and implemented.  These mandated
  programs to improve the Project's operations cannot be implemented until the programmatic
  environmental impact statement has been completed.
  
  Under the Act, the Secretary of the Interior is required to prepare and complete by October
  30, 1995, the programmatic environmental impact statement pursuant to the National 
  Environmental Policy Act, and to treat the costs as capital expenses in accordance with
  Reclamation Law.  Public meetings regarding the scope of the environmental impact
  statement were held during the spring of 1993, and in June 1993, a $12.3 million cost-plus-fixed-fee contract was awarded to an environmental consulting firm for preparation of
  the environmental impact statement.  By August 1996, the contract had been increased to
  $16.7 million (subject to $0.5 million of fiscal year 1997 funding), and the completion date
  was extended to January 31, 1997, or more than 1  year after the date required for completion
  of the statement.  The consultant presented a draft report to the Bureau in July 1996.  The
  Bureau, the U. S. Fish and Wildlife Service, and other interested parties reviewed the draft
  and determined that the statement did not cover possible impacts on rivers that were not
  controlled by the Central Valley Project but which fed into the Central Valley Project  and
  that two of the proposed alternatives were not feasible. Based on the preliminary review, the
  Bureau requested that the consultant  revise the impact statement to address these concerns. 
  At the present time, the additional cost to address the concerns is unknown, and  it is
  estimated that the completion date could be delayed until July 1997.  Thus, the legislated date
  of completion may be missed by almost 2 years.  In addition,  the delay affects 
  implementation of most of the provisions of the Act,  including  the renegotiation of 
  approximately 200 long-term water contracts, implementation of the three-tier rate schedule,
  collection of fees for wildlife restoration, and implementation of fish and wildlife enhancement
  activities.
    
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit  is to determine whether the Bureau awarded and administered the
  contract and modifications for the environmental impact statement in accordance with Federal
  procurement laws and pertinent regulations. The audit will include a review of : (1) the
  Bureau's postaward contract administration procedures and practices; (2) the Bureau's
  monitoring of contractor progress and compliance with contract requirements, including
  accounting and record- keeping requirements; and (3) the Bureau's management of contract
  changes and modifications.  Additionally, we will determine whether the Bureau has properly
  recorded the costs of the programmatic environmental impact statement as capital expenses
  in accordance with Reclamation Law.  The scope of the review will be contract activities that
    occurred from contract award to present.                           FACT SHEET
  
  
                    U.S. GEOLOGICAL SURVEY
                    FINANCIAL STATEMENTS 
                FOR FISCAL YEARS 1996 AND 1997
  
  
  TYPE OF AUDIT
  
  Financial - all funds
  
  BACKGROUND
  
  The Congress enacted the Chief Financial Officers Act of 1990 to reform the fundamental
  financial management requirements and practices of obsolete and inefficient Federal systems. 
  The purpose of the Act is to bring more effective general and financial management practices
  to the Federal Government by:  (1) improving the financial management functions of the
  Office of Management and Budget; (2) designating a chief financial officer in each executive
  department and major executive agency; and (3) providing for improvements in accounting
  and management control systems to ensure the issuance of complete, reliable, and timely
  financial information.
  
  The U.S. Geological Survey publishes and disseminates scientific data and maps concerning
  water, land, and mineral resources.  Its major mission is to undertake research, fact finding,
  and mapping aimed at increasing the Nation's knowledge of the extent, distribution, and
  character of development and use of land, water, and the physical environment.
  
  In fiscal year 1996, the National Biological Service's appropriation was transferred to the
  Geological Survey, and, during fiscal year 1997, Biological Service's accounting operations
  were incorporated into the Geological Survey's accounting system. In addition, during fiscal
  year 1996, certain operations of the former Bureau of Mines were transferred to the
  Geological Survey. 
  
  AUDIT OBJECTIVE AND SCOPE
  
  We will audit the Geological Survey's financial statements for fiscal years 1996 and 1997. 
  The objective of the audit is to determine whether:  (1) the financial statements were
  presented fairly and in accordance with applicable accounting standards; (2) internal controls
  were effectively implemented (that is, assurance was provided that the Geological Survey
  complied with applicable laws and regulations; safeguarded funds, property, and other assets
  against waste, loss, unauthorized use, or misappropriation; and properly recorded and
  accounted for revenues and expenditures); (3) the Geological Survey complied with
  applicable laws and regulations as required by generally accepted government auditing
  standards; (4) the internal control evaluation process was in compliance with the Federal
  Managers' Financial Integrity Act and Office of Management and Budget guidelines and
  requirements; and (5) the significant financial information in the overview was consistent with
  the financial statements and the systems providing data for the significant performance
  measures in the overview were reliable.
  
                               FACT SHEET
  
  
        OVERHEAD COSTS OF COST-REIMBURSABLE PROJECTS,
                    U.S. GEOLOGICAL SURVEY
  
  
  TYPE OF AUDIT
  
  Financial - Surveywide
  
  BACKGROUND
  
  The U.S. Geological Survey conducts geologic and mineral resource and water resource
  research and surveys with funding from other Federal and non-Federal agencies.  Historically,
  the Geological Survey has performed work with financing from non-Geological Survey
  funding sources on a cost-reimbursable basis.  For work performed under cooperative
  programs, such as the Federal-State Cooperative Program and the State Geological Mapping
  Program, the Geological Survey typically agrees to a cost-sharing arrangement in which the
  Geological Survey limits its contribution to 50 percent or less of the project costs.  Other
  reimbursable project work, however, is fully funded by non-Geological Survey organizations.
  
  In fiscal years 1996 and 1997, the Geological Survey plannned to obligate $1.1 billion of non-Geological Survey funds on work performed on a cost-reimbursable basis.  Of these amounts,
  $62.1 million in fiscal year 1996 and $79.4 million in fiscal year 1997 will be spent on the
  Geological Survey's Federal-State Cooperative Program conducted by the Water Resources
  Division.
  
  In the audit report "Federal-State Cooperative Program, Water Resources Division" (No. 95-I-725), issued in March 1995, we found that the Geological Survey had not properly
  accounted for the costs of project work conducted under joint-funding agreements.  Under
  these agreements, the Geological Survey had agreed to perform work on a cost-reimbursable
  basis, with the Geological Survey and the cooperating agencies contributing specified
  amounts of funding.  We found, however, that the Geological Survey had not equitably
  allocated direct or overhead costs to these projects and had assessed bureau-level overhead
  costs to the projects when the projects were exempt from such overhead charges.  We also
  found that the Geological Survey had included direct costs in its district overhead cost pool,
  a practice that is contrary to generally accepted accounting principles.  Partly based on our
  audit finding, the Geological Survey received a qualified opinion on its financial statements
  for fiscal year 1995.
  
  
  In response to our report, the Geological Survey agreed to reprogram its automated
  accounting system so that costs would be allocated to projects in accordance with the terms
  of  joint-funding agreements.  The Geological Survey also stated that it would "seek a change
  to enabling legislation" to permit fixed price agreements for certain types of water resource
  projects and that it would "seek a change in its appropriation" to allow the Geological Survey
  to account for project costs over the life of the project rather than on an annual basis. 
  Further, the Geological Survey said that it would direct its district offices to stop shifting
  costs between accounts, seek additional funding or discontinue work on unfunded projects,
  and rescind guidance that allowed district offices to charge unfunded work (direct costs) to
  overhead accounts.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the U.S. Geological Survey accurately
  computed and distributed overhead costs to cost-reimbursable projects.  The scope of the
  audit will include a review of cost-reimbursable projects of the Water Resources and Geologic
  Divisions for fiscal years 1996 and 1997.
                               FACT SHEET
  
  
          CONSTRUCTION OF THE SOUTHERN HIGH SCHOOL,
                                DEPARTMENT OF PUBLIC WORKS,
                      GOVERNMENT OF GUAM
                                
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  As part of an overall plan to construct seven schools, the Government of Guam issued a $175
  million school bond in September 1993.  One of the seven schools planned was the Southern
  High School, which was to be constructed in the Village of Santa Rita on land previously
  under the control of the U.S. Navy.  The design and specifications for the project initially
  raised concerns of local contractors that the $76 million estimated cost was higher than
  expected and the planned facilities were more elaborate than needed.  Eventually, a
  construction contract was awarded in January 1994 for $72 million; however, the lowest of
  the eight bids initially submitted was $82 million.
  
  Construction was started in February 1994 but was stopped in January 1995 because toxic
  wastes were discovered on the construction site.  Work started again in March 1995, after
  the site was cleaned; however, the cost of the cleanup and additional payments to the contract
  cost the Government of Guam an additional $1.8 million.  The project is scheduled to be
  completed in September 1997.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether: (1) the design and engineering of the
  Southern High School project ensured that available funding was used effectively; (2) the
  procurement of design, engineering, and construction management services and the
  construction contract were in accordance with applicable laws and regulations; and (3) the
  project was managed in an efficient and effective manner.  The scope of the audit will include
  the project's planning, design, and construction activities that occurred from fiscal years 1993
  through 1997.
  
                               FACT SHEET
  
  
                    GROSS RECEIPTS TAXES,
             DEPARTMENT OF REVENUE AND TAXATION,
                      GOVERNMENT OF GUAM
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Government of Guam's Gross Receipts Tax law levies a tax of 4 percent, primarily
  against sales of rental property, retail sales, and services, and is to be paid monthly by the
  individuals and companies subject to the tax.  Guam taxpayers are to voluntarily compute the
  taxes due and prepare and file a monthly Gross Receipts Tax return within 20 days after the
  end of the month to which the return applies.  The Guam Department of Revenue and
  Taxation is responsible for assessing, administering, enforcing, and collecting the Gross
  Receipts Taxes.  Revenue and Taxation's Business Privilege Tax Branch is responsible for
  reviewing and processing each return and for initiating billing actions for underpaid taxes. 
  However, the Collection Branch is responsible for collecting delinquent gross receipts taxes.
  
  For fiscal year 1992 (the latest available audited figures), Gross Receipts Tax revenues totaled
  $156 million, or 28 percent of total General Fund revenues.  In addition, in fiscal year 1992,
  gross receipts taxes receivable totaled $9 million, which was a $5 million increase over the
  fiscal year 1991 balance.  Although not identified by type of tax receivable, the total reserve
  for uncollectible taxes was 39.5 percent of total taxes receivable.  According to unaudited
  revenue figures, total gross receipts taxes collected in fiscal years 1994 and 1995 were $157
  million and $179 million, respectively.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Government of Guam effectively
  assessed and collected the gross receipts taxes applicable under Guam laws and regulations. 
  The scope of the audit will include a review of taxes assessed and collected and tax laws in
  effect during fiscal years 1995 and 1996 and other periods as appropriate.
                               FACT SHEET
  
  
                  COMMONWEALTH LEGISLATURE,
         COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Legislature of the Commonwealth of the Northern Mariana Islands was established by
  Article II of the Constitution of the Northern Mariana Islands as a bicameral body composed
  of a Senate and a House of Representatives.  The Senate consists of nine members elected to
  4-year terms, with three members elected at large from each of three senatorial districts: (1)
  Rota, (2) Tinian and Aguiguan, and (3) Saipan and the islands north of Saipan.  The House
  of Representatives consists of 18 members elected to 2-year terms:  16 members elected from
  Saipan and the islands north of Saipan, 1 member elected from Rota, and 1 member elected
  from Tinian and Aguiguan.  In addition to the 27 elected members, the Senate and the House
  employed 143 support employees, and the Legislative Bureau employed another 26 personnel
  who provided administrative support services to both houses.
  
  Article II of the Commonwealth Constitution and applicable appropriations established the
  Legislature budgetary ceiling at $4.5 million, which includes $2.8 million divided equally
  between the Senate and the House of Representatives for Legislature operations, excluding
  elected members' salaries; $900,000 appropriated annually for Legislature members' salaries;
  and $800,000 appropriated annually to operate the Legislative Bureau.  The unaudited
  expenditure report for fiscal year 1994 shows total expenditures of $4.9 million, which
  exceeded the budget ceiling by $400,000.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Commonwealth Legislature expended
  funds in accordance with applicable laws, internal operating policies and procedures, and
  sound business practices.  The scope of the audit will include a review of encumbrances and
  expenditures incurred in fiscal years 1995 and 1996 and other periods as appropriate.
  
  
                          FACT SHEET
  
  
                MANAGEMENT OF FEDERAL GRANTS,
                    PUBLIC SCHOOL SYSTEM,
  COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Department of Education's Public School System operates under the goals and guiding
  principles established by the Board of Education.  The Board selects the Commissioner, who
  is authorized to implement the Board's goals and guiding principles.  Within the Department,
  the Management Support Section provides fiscal, compliance, coordination, and technical
  assistance for all Federal programs.
  
  The unaudited expenditure report for fiscal year 1995 shows Departmental expenditures
  totaling $50.6 million, which included Federal grant fund expenditures for 20 grants totaling
  $16 million.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Public School System's grants
  management system ensured compliance with applicable Federal laws and regulations as they
  related to:  (1) the procurement and administration of contracts and property; (2) the
  identification and allocation of costs for personnel and for contract employees; and (3) the
  billing of and control over cash drawdowns.  The scope of the audit will include a review of 
  procedures and controls for the management of Federal grants that were in effect during fiscal
  years 1995 and 1996 and other periods as appropriate.
                               FACT SHEET
  
  
                   PROCUREMENT ACTIVITIES,
               PROCUREMENT AND SUPPLY DIVISION,
                    DEPARTMENT OF FINANCE,
         COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Commonwealth of the Northern Mariana Islands Code (Title 1, Section 7404) requires
  the Director of Finance's procurement regulations to govern the expenditure of all
  appropriated funds.  Within the Department of Finance, the Procurement and Supply Division
  is responsible for processing and approving all Executive Branch procurement actions,
  excluding only petty cash purchases.  In addition, the Office of Management and Budget,
  within the Governor's Office, authorizes the availability of funds, and the Department of
  Public Works assists in processing construction procurement actions.
  
  The procurement regulations specify different procurement procedures for small purchases
  of less than $2,500; procurement actions for $2,500 to $10,000; and procurement actions
  exceeding $10,000.  Although the number and total dollar value of the different types of
  procurement actions were not readily available, the Department of Finance, during fiscal years
  1994 and 1995, authorized about 472 formal written contracts (excluding purchase orders),
  totaling more than $44 million.  The 472 contracts consisted of 154 professional services
  contracts ($8.7 million); 62 construction contracts ($27.9 million); 51 capital purchases
  contracts ($2.7 million); and 205 other services, charges, and supplies contracts ($5 million).
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Procurement and Supply Division
  conducted procurement actions efficiently and economically and in accordance with applicable
  laws and regulations.  The scope of the audit will include a review of procurement activities,
  exclusive of procurement actions for professional services, that occurred during fiscal years
  1995 and 1996 and other periods as appropriate.
                          FACT SHEET
  
  
                RURAL ECONOMIC AND COMMUNITY 
                    DEVELOPMENT SERVICES,
               U.S. DEPARTMENT OF AGRICULTURE,
                FEDERATED STATES OF MICRONESIA
  
  
  TYPE OF REVIEW
  
  Performance - economy and efficiency (limited survey)
  
  BACKGROUND
  
  U.S. Public Law 99-239, the Compact of Free Association of 1985 between the Government
  of the United States and the Government of the Federated States of Micronesia, was
  approved on January 14, 1986.  As provided by Section 224 of the Compact, the United
  States and the Federated States agreed, by Section 105(h)(1)(C), to extend the Rural
  Economic and Community Development Services (formerly the Farmers Home
  Administration), an agency of the U.S. Department of Agriculture, to each of the four states
  in the Federated States.  The four area offices are operated by the U.S. Department of
  Agriculture and managed by a District Director located on Guam, who reports to the State
  Director in Hilo, Hawaii.
  
  The Pohnpei Area Office administers three housing repair loan programs as authorized by
  Section 504 of the U.S. Housing Act.  The Area Office employs four locally hired Federal
  employees, two employees paid by the national government, and seven employees paid by the
  Pohnpei state government.  The national and state governments combined provide about
  $100,000 per year, primarily for salaries, for operation of the Area Office.  Of the four area
  offices, the Pohnpei Area Office administers the largest number of loans: about 2,200 loans,
  with a total loan balance of about $5 million.  The three loan programs provide the following: 
  (1) an unsecured housing repair loan of up to $2,500; (2) a secured housing repair loan of up
  to $7,500 if the homeowner does not have clear title and cannot obtain fire insurance; and (3)
  a secured housing repair loan of up to $15,000 if the homeowner has clear title and can obtain
  fire insurance.  Although other loan and grant programs may become available to Pohnpei
  residents, the Area Office does not yet offer these programs.
  
  
  
  
  SURVEY OBJECTIVE AND SCOPE
  
  The objective of the limited survey is to determine whether the Pohnpei Area Office is
  complying with U.S. Department of Agriculture loan and administration procedures.  The
  survey scope will include Area Office operations and all loans issued and administered during
    fiscal year 1995 and other periods as appropriate.                           FACT SHEET
  
  
              MARSHALL ISLANDS DEVELOPMENT BANK,
               REPUBLIC OF THE MARSHALL ISLANDS
  
  
  TYPE OF REVIEW
  
  Performance - economy and efficiency (limited survey)
  
  BACKGROUND
  
  The Republic of the Marshall Islands established the Development Bank in March 1978.   The
  Development Bank was established:  (1) to provide financial assistance through making loans,
  guaranteeing loans, and making equity investments in enterprises; (2) to provide nonfinancial
  assistance by identifying investment opportunities, undertaking feasibility studies, and
  promoting the formation of new enterprises (as well as expanding existing enterprises to
  enlarge the economic base of the country); (3) to manage or participate in the management,
  supervision, or conduct of business enterprises; and (4) to participate in the programs and
  services of the U.S. Government, including those programs listed in the Compact of Free
  Association.
  
  The Development Bank is funded through contributions from the Marshall Islands
  government and through administration of Compact funds (Compact Sections 111 and 211). 
  In fiscal year 1989, the Development Bank received Compact contributions of $4 million. 
  Additionally, in fiscal year 1989, the Marshall Islands government transferred more than $6.1
  million from the Compact Investment Development Fund to the Development Bank for
  operating funds.  In January 1992, the assets and liabilities of the Marshall Islands Housing
  Authority were transferred to the Development Bank.
  
  The Marshall Islands single audit report for fiscal year 1995 showed that the Development
  Bank had:  (1) net loans receivable of $6.2 million; (2) interest income of $1.1 million; and
  (3) a calendar year 1994 operating loss of $1.1 million.  In addition, the single audit reported
  contributed capital of $17.3 million and an unreserved retained earnings deficit of $8.3
  million.
  
  
  
  
  SURVEY OBJECTIVE AND SCOPE
  
  The objective of the limited survey is to determine whether Development Bank loans and
  interest receivables were accounted for and collected.  The survey scope will include all loans
  issued and administered during fiscal year 1996 and other periods as appropriate.
     
                          FACT SHEET
  
  
                 MANAGEMENT AND OVERSIGHT OF
               SELECTED CONSTRUCTION PROJECTS,
                      REPUBLIC OF PALAU
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  On October 1, 1994, the 50-year Compact of Free Association between the United States and
  the Republic of Palau became effective and provided, when compared with prior years, a
  substantial increase in United States funding to the Republic.  During fiscal years 1990
  through 1994, under the Trust Territory of the Pacific Islands, the Republic received 14
  capital improvement project grants, totaling $26 million.  These projects are subject to review
  by the Office of Insular Affairs, U.S. Department of the Interior.  For the first year of the
  Compact, fiscal year 1995, Sections 212 and 215 of the Compact stated that the Republic was
  to receive $36 million (plus an adjustment for inflation from fiscal year 1981) for capital
  improvements.  For the years after 1995, the Compact continues to provide substantial funds
  for additional capital improvements.
  
  Compact Section 23(a) requires the Republic to promulgate, with the concurrence of the 
  U.S. Government, an "official national development plan" and to expend the funds provided
  under Section 212 in accordance with this plan.  For fiscal year 1995, the plan listed 26 capital
  improvement projects, with an estimated cost of $117 million.  The Capital Improvement
  Project Office in the Bureau of Public Works, within the Ministry of Resources and
  Development, is responsible for providing management and oversight of Republic of Palau
  construction projects.  The Capital Improvement Project Office has a staff of 21 individuals.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Government of the Republic of Palau
  and the Office of Insular Affairs, U.S. Department of the Interior, provided adequate
  management and oversight of construction projects funded by either the Trust Territory of
  the Pacific Islands or the Compact of Free Association.  The audit scope will include projects
  selected from all construction projects in process and/or completed during fiscal years 1995,
  1996, and 1997.
                               FACT SHEET
  
  
            U.S. FISH AND WILDLIFE SERVICE GRANTS,
         DEPARTMENT OF MARINE AND WILDLIFE RESOURCES,
                  AMERICAN SAMOA GOVERNMENT
  
  
  TYPE OF AUDIT
  
  Financial - grant
  
  BACKGROUND
  
  The Department of Marine and Wildlife Resources, within the Executive Branch of the
  American Samoa Government, is the agency responsible for administering grants from the
  U.S. Fish and Wildlife Service, U.S. Department of the Interior.  The Fish and Wildlife
  Service provides Federal grant funds for the sport fish restoration and wildlife restoration
  programs.  For these two programs, Marine and Wildlife Resources received  $1,018,108 and
  $994,419, respectively, during fiscal years 1995 and 1996.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether Federal grant funds were used in
  accordance with grant terms and conditions and applicable Federal and American Samoa
  Government laws and regulations.  The scope of the audit will include a review of Federal
  grant expenditures made for sport fish restoration and wildlife restoration that occurred
  during fiscal years 1994 through 1996 and other periods as appropriate.
  
                               FACT SHEET
  
  
                  HOSPITAL SERVICE CHARGES,
              ROY L.  SCHNEIDER AND JUAN F. LUIS
                     COMMUNITY HOSPITALS,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Government-operated hospitals on St. Thomas and St. Croix generate about $30 million
  annually in medical services charges.  However, prior audits showed that during 1988, the
  two hospitals did not bill patients for about $10 million in medical services.  At that time, the
  hospitals also had about $62 million in delinquent accounts receivable.  Although the Roy
  Schneider (then St. Thomas) Hospital subsequently contracted with a Texas-based collection
  agency to try to collect the delinquent accounts, our review of the professional services
  contract showed that the Hospital did not provide adequate oversight of the contractor's
  activities.  As a result, the Hospital did not have control over computer and paper files
  evidencing the receivables and did not institute controls to ensure that the collection agency
  remitted all amounts collected to the Hospital.  The Boards of Directors of both hospitals
  have reportedly made subsequent changes to the billing and collection procedures.  However,
  at a July 1996 meeting to discuss Department of the Interior technical assistance funds,
  Government officials said that the Roy Schneider Hospital was almost 1 year in arrears in
  issuing bills for hospital services.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to evaluate the hospitals' billing and collection practices.  For
  example, we will determine whether: (1) bills for collections were issued timely; (2) accounts
  receivable records were accurate; and (3)  collection enforcement efforts were effective.  The
  scope of audit will include a review of billings and collections that occurred during fiscal years
  1996 and 1997 and policies and procedures in effect at the time of the audit.
  
                               FACT SHEET
  
  
                SEWAGE SYSTEM SERVICE CHARGES,
                 DEPARTMENT OF PUBLIC WORKS,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  The Department of Public Works is responsible for operating the sewage system in the Virgin
  Islands.  In 1988, we reported that the potential existed for the Government to lose more than
  $1 million available from the Environmental Protection Agency for wastewater treatment
  plant construction because the Government did not assess a service charge to recover the cost
  of operating the sewage system.  At that time, the annual operating cost was $2.6 million. 
  The Government has subsequently instituted a sewage service charge structure.  Although 
  information on the total revenues generated by the service charges is not detailed  in the
  Government's Executive Budget, the Budget for fiscal year 1997 proposes appropriations of
  about $1 million from the Sewage System Fund for operation of the system.  The Office of
  Inspector General has not audited the administration and collection of sewage system service
  charges.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to evaluate the Department's billing and collection practices for
  sewage system service charges.  For example, we will determine whether:  (1) bills for
  collection were issued timely; (2) accounts receivable records were accurate; and (3)
  collection enforcement efforts were effective.  The scope of audit will include a review of
  billings and collections that occurred during fiscal years 1996 and 1997 and policies and
  procedures in effect at the time of the audit.
  
                               FACT SHEET
  
  
             CONSTRUCTION MANAGEMENT CONTRACT FOR
               THE HURRICANE RECOVERY MANAGERS,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  On September 15, 1995, Hurricane Marilyn struck the Virgin Islands, causing extensive
  damage to public and private facilities.  As a result, the President of the United States issued
  a major disaster declaration, which allowed the Federal Emergency Management Agency
  (FEMA) to provide disaster assistance funds in accordance with the Stafford Disaster Relief
  and Emergency Assistance Act, as amended (Public Law 100-707).  Because the Government
  of the Virgin Islands was in need of a contractor to provide overall project management
  services for the massive reconstruction effort, the Government entered into a contract with
  a stateside architectural/engineering firm.  The firm is generally known by Government and
  FEMA officials as the "Hurricane Recovery Managers." According to the contract, the
  Hurricane Recovery Managers will have broad responsibility for overseeing and managing
  construction projects, including involvement in the development of invitations for
  bids/requests for proposals, the selection of construction contractors, the inspection of
  construction work, and the approval of payments to contractors.  This role is even broader
  than that of the deJongh/Williams joint venture, which, after Hurricane Hugo in September
  1989, was the subject of audits that questioned millions of dollars in charges billed by the joint 
  venture.  Unexpectedly, in August 1996, Hurricane Recovery Managers terminated their
  involvement in the Government's reconstruction efforts, apparently because of differences of
  opinion with Governmental officials over  management of the recovery process.  The impact
  of this move on the recovery process and on payments to the contractor is unknown.  In the
  interim, the Government hired another architectural firm to act as Hurrican Recovery
  Managers.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether:  (1) adequate controls existed to ensure
  that the Hurricane Recovery Managers fulfilled their construction oversight responsibilities;
  (2) costs claimed by the Hurricane Recovery Managers were reasonable, allowable, and
  allocable in accordance with contract provisions; and (3) removal of the contractor from
  management of school reconstruction projects was justified.  The scope of audit will include
  construction-related activities and billing claims submitted by the Hurricane Recovery
  Manager firms during fiscal years 1996 and 1997.
                          FACT SHEET
  
  
                HURRICANE-RELATED CONTRACTING,
                   DEPARTMENT OF EDUCATION,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  On September 15, 1995, Hurricane Marilyn struck the Virgin Islands, causing extensive
  damage to public and private facilities.  As a result, the President of the United States issued
  a major disaster declaration, which allowed  the Federal Emergency Management Agency
  (FEMA) to provide disaster assistance funds in accordance with the Stafford Disaster Relief
  and Emergency Assistance Act, as amended (Public Law 100-707).  FEMA provided funds
  to repair, among other facilities, the public schools in the Virgin Islands.  The Government
  of the Virgin Islands, in turn, subcontracted the construction work to private firms. 
  Preliminary estimates are that contracts totaling about $14 million had been issued as of July
  1996 for school repairs.  Additionally, after Hurricane Bertha, in July 1996, destroyed the
  roof of a school that was repaired after Hurricane Marilyn, questions were raised by the local
  media as to whether hurricane-related reconstruction work was being performed in
  accordance with building code requirements.  Also, allegations were made in the media that
  the Department of Education had the Government's Hurricane Recovery Managers removed
  from responsibility for monitoring school reconstruction work when these managers
  questioned the quality of work being performed at a public high school on St. Thomas.  As
  of July 1996, Governmental officials had not responded to questions related to these
  allegations.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether:  (1) construction contracts were awarded
  in accordance with applicable laws and regulations; (2) controls existed to ensure that
  construction work was being performed in accordance with building code and other
  requirements; and (3) payments to contractors were reasonable, allowable, and allocable in
  accordance with contract provisions.  The scope of audit will include hurricane-related
  construction contracts awarded by or for the Department of Education during fiscal years
  1996 and 1997.
  
                          FACT SHEET
  
  
                HURRICANE-RELATED CONTRACTING,
           DEPARTMENT OF PROPERTY AND PROCUREMENT,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency
  
  BACKGROUND
  
  On September 15, 1995, Hurricane Marilyn struck the Virgin Islands, causing extensive
  damage to public and private facilities.  As a result, the President of the United States issued
  a major disaster declaration, which allowed the Federal Emergency Management Agency
  (FEMA) to provide disaster assistance funds in accordance with the Stafford Disaster Relief
  and Emergency Assistance Act, as amended (Public Law 100-707).  FEMA provided funds
  to repair Government-owned facilities, including public schools, public housing projects, and
  health care facilities.  The Government of the Virgin Islands, in turn, subcontracted the
  construction work to private firms.  Our limited reviews of the contracting activities of the
  Departments of Education and Public Works immediately after the hurricane disclosed that
  at least those two agencies did not obtain approval for the contracts from the Department of
  Property and Procurement, which is the Government's only authorized contracting office.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether:  (1) construction contracts were awarded
  in accordance with applicable laws and regulations; (2) controls existed to ensure that
  construction work was being performed in accordance with building code and other
  requirements; and (3) payments to contractors were reasonable, allowable, and allocable in
  accordance with contract provisions.  The scope of audit will include hurricane-related
  construction contracts awarded during fiscal years 1996 and 1997 by or for Governmental
  agencies other than the Department of Education, which will be reviewed separately.
                               FACT SHEET
  
  
            FOLLOWUP OF THE BUREAU OF CORRECTIONS,
                    DEPARTMENT OF JUSTICE,
               GOVERNMENT OF THE VIRGIN ISLANDS
  
  
  TYPE OF AUDIT
  
  Performance - economy and efficiency (limited scope)
  
  BACKGROUND
  
  In 1987, the Bureau of Corrections was reorganized as a unit within the Virgin Islands
  Department of Justice.  The Bureau operates four correctional facilities in the Virgin Islands:
  the Golden Grove Adult Correctional Facility, the Anna's Hope Adult Detention Center, and
  the Youth Rehabilitation Center, all three of which are located on St. Croix, and the Adult
  Detention Center, which is located in the Alexander Farrelly Criminal Justice Center on St.
  Thomas.  The adult inmate population averaged about 400 persons in 1990, although the
  three adult facilities have a total design capacity of 216 persons.  A comprehensive audit of
  the Bureau conducted during 1991 and 1992 disclosed significant deficiencies related to
  security and maintenance, overcrowding, inmate care and safety, and administrative functions. 
  A new Director was appointed in September 1992, and he began to make improvements in
  the Bureau's operations.  However, his contract with the Government was terminated before
  his corrective plan of action was completed.  Therefore, the extent to which problems
  disclosed in the prior audit reports have been corrected is unknown.  The Bureau's annual
  operating budget totals about $15 million.
  
  AUDIT OBJECTIVE AND SCOPE
  
  The objective of the audit is to determine whether the Bureau of Corrections had satisfactorily
  implemented  recommendations made in four of our prior audit reports on Bureau operations
  and whether any new recommendations were warranted.  The scope of audit will include
  Bureau operations for fiscal years 1996 and 1997 and Bureau policies and procedures in
  effect at the time of the audit.