Magazine article The CPA Journal

GAO Continues to Criticize the IRS

Magazine article The CPA Journal

GAO Continues to Criticize the IRS

Article excerpt

The U.S. General Accounting Office (GAO) continues to issue unfavorable reports on the IRS. The latest report, issued in February; and titled IRS Does Not Adequately Manage Its Operating Funds is one of several reports on the GAO audit for 1992. The chapter titles tell it all:

* IRS had weak systems and controls for ensuring compliance with laws governing the use of budget authority.

* Fundamental deficiencies existed in IRS' procedures and internal controls for payments.

* IRS processes and systems did not support reporting needs.

One of the main problems in the first category was that managers did not have current information on available appropriations. However, the report cites other problems more familiar to accountants, and the amounts are huge. As of September 30, 1992, there were several billions of dollars in cumulative gross differences, going as far back as 1986, between the IRS's records and those of the Treasury' Department. At the end of fiscal 1992 there was an unresolved difference of $63 million between Treasury's cash balance and General Services Administration's (GSA) allocation account to IRS.

In the internal control area, GAO noted in its testing that vendors were paid twice for the same goods and services because IRS made payments based on copies of invoices. …

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