Office of Community Oriented Policing Services Methamphetamine Initiative Grants Administered by the Indiana State Police Department

Audit Report GR-50-05-010
June 2005
Office of the Inspector General

Executive Summary

The Office of the Inspector General, Audit Division, has completed an audit of Methamphetamine Initiative grants awarded by the Office of Community Oriented Policing Services (COPS) to the Indiana State Police (Indiana SP). The purpose of these grants is to provide funds to purchase vehicles and equipment and to pay overtime as needed to reduce the production, distribution, and use of methamphetamine. Between May 2001 and January 2004, COPS awarded the Indiana SP four grants, totaling $3,431,234, to assist the Indiana SP in combating methamphetamine laboratories in Indiana.

We tested the Indiana SPís compliance with essential grant conditions, including grant drawdowns, budget management and control, grant expenditures, and grant reporting and found that the grantee did not fully comply with the grant requirements. Specifically, we found that the grantee did not maintain an adequate system of accounting and internal controls to ensure that grant expenditures were properly recorded and tracked. The grantee failed to maintain official, detailed expenditure records segregated by grant. Instead, all COPS Methamphetamine Initiative funds were commingled. The day-to-day grant administrator maintained more detailed secondary records; however, these records were not reconciled to the official accounting system. As a result, we identified dollar-related findings totaling $534,201.1 Specifically, we found:

  • Before the receipt of grant funds, the grantee was expending, on average, about $11,640 per month on overtime related to methamphetamine enforcement activities. Upon receipt of the grants, the Indiana SP stopped using state funds to pay overtime for methamphetamine-related work. During the 43-month grant period reviewed, grant funds were used to pay $632,663 in overtime costs. If the grantee had continued its historical commitment to pay overtime during this period, the Indiana SP would have paid out about $500,520 in state funds for this purpose. As a result we question this amount in grant funds expended on overtime and $8,713 in grant-funded fringe benefits associated with these costs.

  • For the Indiana SP to receive grant funds for overtime and fringe benefits of its employees, the grantee was required to submit to the COPS Office a list authorized personnel or positions. However, we found that although the Indiana SP was to submit this listing for each individual grant, the grantee submitted only one listing. Our testing revealed that the Indiana SP used grant funds to pay 61 personnel who were not on the list submitted to the COPS Office. During our audit, the grantee provided us with a current list of authorized personnel; however, we identified 30 personnel who received grant-funded overtime, but were not on this new list.

  • A total of $23,139 was used to pay for unapproved and unallowable expenditures such as food, pagers, and physical examinations.

  • The Indiana SP did not properly track and identify property purchased with grant funds. In addition, the Indiana SP did not conduct physical inventories and could not account for one laptop computer with an acquisition cost of $1,829.

  • In grant 2001-CKWX-0175, the Indiana SP made a drawdown of $295,516 on January 11, 2002. In July 2002, a Department of Justice official conducted an on-site review and informed the Indiana SP that it had excess funds on hand and directed the grantee to take prompt action. However, these funds were not fully expended until October 27, 2002.

  • The Indiana SP did not comply with the requirements for timely filing of Financial Status Reports (FSRs). Of the 28 FSRs the grantee was required to submit, seven had not been filed and four were between 2 and 24 days late. In addition, three of the five required progress reports were untimely.

Our report contains 13 recommendations to address the preceding issues, which are discussed in detail in the Findings and Recommendations section of the report. Our audit objective, scope, and methodology appear in Appendix I.

We discussed the results of our audit with Indiana SP officials and have included their comments in the report, as applicable. In addition, we provided the grantee and the COPS Office with a draft of our audit report and requested formal responses, which were appended


  1. The Inspector General Act of 1978, as amended, contains our reporting requirements for questioned costs and funds to better use. However, not all findings are dollar-related. See Appendix II for a breakdown of our dollar-related findings and for definitions of questioned costs.