I appreciate the opportunity to comment on the subject draft report and solicited input from the senior management officials who are most significantly impacted -- the Executive Associate Commissioner for Field Operations and Executive Associate Commissioner for Management. I reviewed the responses and concur with the corrective actions planned. The responses are attached for your review.

If you have any questions, please contact Kathleen Stanley, Audit Liaison, at (202) 514-8800.

Attachments (2)

cc: Vickie L. Sloan, DOJ Audit Liaison

The following is the Immigration and Naturalization Service (INS) response to the subject draft audit report recommendations assigned as the responsibility of the Office of Financial Management. The INS concurs with recommendations 1, 2, and 6 and has provided specific responses addressing each recommendation. RECOMMENDATION 1: Revise the manual receipt and deposit process and, subsequently, the Fee Collection Procedures Manual. At a minimum, the revisions should include the following:

1. Destroy all unused 2-part G-211 receipts and require that POEs use only the 3-part, pre-numbered G-711s as the individual receipt.
2. Eliminate use of the Daily Register of Receipts (G-253).
3. Require that air POEs use the Summary of Fees (G-712) to verify and certify the accuracy of the fees collected.
4. Require that each air POE prepare its own deposit, including the Deposit Ticket (SF-215), and secure the deposit in a sealed bank bag for delivery to a bank or to transfer to another INS office.
5. Require that each air POE directly submit copies of individual receipts (G-711), the Summary of Fees (G-712), and the Deposit Ticket (SF-215) to the Debt Management Center.
6. Establish guidance and controls for use of fee paid stamps in lieu of cash register validations.
7. Develop guidance and controls to ensure a thorough end-of shift or end-of-day reconciliation of fees collected and the applications processed.
8. Require that INS applications be adequately annotated with fee paid or fee waived information.
9. Require that applications and fee collection and deposit documentation be retained as the source documents for the accounting records for the necessary retention period (currently six years, three months).

1a. Concur. The OFM will revise the manual fee collections and deposit procedures in the Fee Collection Procedures Manual as recommended. Specifically, we will revise Chapter VI, Management Overview; Chapter VII, Manual Fee Collection Procedures; and Chapter VIII, Manual Fee Deposits, the three chapters impacted by the recommended change to use only the G-711 manual receipt. In the May 2002 revision on CD-ROM, INS required field offices to destroy all unused unnumbered Forms G-211 and use only pre-numbered or serialized G-211s or G-711s. The next revision (Fall 2002) will stipulate that all Forms G-211 must be recalled and destroyed by the Principal Officer at all INS offices collecting fees and that only the 3-part, pre-numbered G-711s may be used as the individual manual receipt. OFM will also instruct the Western Forms Center to destroy all remaining Forms G-211 and to issue only pre-numbered Forms G-711 in the future.

lb. Concur. On INSERTS CD-ROM Release III (Fall 2002), the OFM will provide instructions calling for elimination of the use of the Form G-253, Daily Register of Receipts, formerly used with the issuance of G-211 receipts, now eliminated as well.

1c. Concur. On INSERTS CD-ROM Release III (Fall 2002), the OFM will provide instructions for the mandatory use of the G-712, Summary of Fees, with the now required G-711 individual receipts. This guidance will be issued in the manual found in the appendices of the Inspector's Field Manual, Appendix 46-1, Port of Entry Cash Management Procedures also on INSERTS, and will apply to all INS offices collecting fees.

1d. Concur. Provisions are currently in place for each Port of Entry (POE) to comply with the requirements of this recommendation concerning preparing their own deposit and securing it. By September 30, 2002, the OFM will add language to the procedures in Appendix 46-1 to make it clear that deposits and deposit tickets being transferred from smaller to larger offices must remain segregated and not rolled up into a single deposit under one deposit ticket. This will ensure the integrity of deposit records by location.

le. Concur. By September 30, 2002, the OFM will revise the Fee Collection Procedures Manual to make it clear that each POE must directly submit copies of the individual manual receipts (G-711), the Summary of Fees (G-712), and the Deposit Ticket (SF-215) to the Debt Management Center.

lf. Concur. While procedures are in place for the control of fee paid stamps, the OFM will strengthen and clarify the procedures regarding the safeguarding of this equipment by December 31, 2002. These procedures will follow the guidelines already established to safeguard the use of accountable forms located in Chapter 10, Security Officer's Handbook, located in Inserts.

1g. Concur. Procedures are already in place for this recommendation in the Port of Entry Cash Management Procedures on iNSERTS. By September 30, 2002, the OFM will reiterate via a broadcast email message that this guidance applies to all INS offices collecting fees.

lh. Concur. By September 30, 2002, the OFM will add procedures to the Fee Collection Procedures Manual to ensure that INS applications are adequately annotated with fee paid or fee waived information.

1i. Concur. Procedures are already in place to meet compliance with the records retention requirement for journal tapes. By September 30, 2002, the INS will revise the language in the appropriate sections of Appendix 46-i to ensure that applications and fee collection and deposit documentation be retained as the source documents for the accounting records for the required six year, three month retention period.

RECOMMENDATION 2: Design a manual receipt process for issuing G-711 receipts. The system should designate a control point for issuing G-711s to field offices, require use of manual receipts, and require that all manual receipts be accounted for and issued in strict sequential order.

INS RESPONSE: Concur. The INS has already developed a manual receipt process for issuing G-711 receipts. This process was implemented with the distribution of the Fee Collection Procedures at Ports of Entry Manual in July 2000 and in revisions to the manual on INSERTS CD-ROM in October 2001 and May 2002. The OFM will revise the process by including language in Appendix 46-1 that will designate a control point for issuing G-71ls, mandate their use at all ports, and require that these receipts be accounted for and used in strict sequential order. These revised procedures will be provided to all field offices, including POEs, preferably in the fall 2002 CD-ROM release. The revised fee collection procedures will also be available on the Intranet via PowerPort.

RECOMMENDATION 6: Establish unique location codes for each port of entry, subport, district office, suboffice, and service center. Once established, the same location code should be used consistently in all of the INS' Service-wide systems, such as the Financial Accounting and Control System and the Performance Analysis System.

INS RESPONSE: Concur. The INS Office of Financial Management (OFM), in cooperation with other system stakeholders, has concluded that further analysis needs to be performed prior to the implementation of the uniform location codes for the Federal Financial Management System (FFMS). The Performance Analysis System (PAS) is in compliance with INS standardized codes and the Financial Accounting and Control System (FACS) will be replaced in the near future, so they do not need any corrective action. In order for the standardized codes to be effective in FFMS, procedural changes will have to be implemented. These procedural changes will have to be analyzed to determine their operational impact. The analysis of these changes should be completed by December 31, 2002. After the analysis, timeframes will be established for implementation of the uniform location codes for FFMS.

If you have any questions, please contact Judy R. Harrison, Assistant Commissioner, Office of Financial Management, at (202) 305-1200.

The following is the Immigration and Naturalization Service (INS) response to the subject draft audit report recommendations 3, 4, 5, 7 and 8. The INS concurs with the recommendations and has provided specific responses addressing each recommendation.

RECOMMENDATION 3: Discontinue use of the Forms Integration Management System (FIMS) for fee collections at air POEs and other ports of entry.

INS RESPONSE: Concur in part. For those locations using the Disk Operating System (DOS)-based FIMS, we concur that its use should be discontinued for fee collection, due to the possible attempts to manipulate the database. Air POEs will discontinue the use of the DOS based FIMS for fee collection and will use a manual based system to generate a G-711 or utilize a Service-approved cash register or other system as appropriate. Where feasible, the Port of Entry Office Management System (POMS) will replace the DOS based FIMS at air POEs to track fee collection statistics for input into the monthly 0-22. However, at present POMS is DOS based and its database can also be manipulated.

The INS is currently evaluating the viability of an upgraded version of FIMS which is a Windows based program for the office of Inspections. The new version "FIMS 2000" has been utilized throughout the Buffalo District since June 2001. Security gaps in the old FIMS were identified and addressed in the technical upgrade. The new FIMS software precludes the permanent deletion of data entries and passwords conform to the INS standard to include that all entries and changes are tracked by individual sign-on. The G-711 automatically lists or identities the remitter's name, address, the beneficiary's name, the application type, amount and the 1-94 admission or A Number. The receipt number is automatically generated which includes the location, fiscal year, fee day, and the sequence of the fee for that day.

RECOMMENDATION 4: Develop and issue a standard form or checklist for the Trade NAFTA adjudications.

INS RESPONSE: Concur. The North American Free Trade Agreement (NAFTA) Handbook, issued in November 1999, was provided by the Office of Inspections as reference material to assist immigration inspectors in processing applicants for admission under the NAFTA. The NAFTA Handbook contains a summary checklist to assist the inspector in adjudication of both the Canadian and Mexican application. The Canadian NAFTA summary checklist, located on page 159, will be modified to require utilization of the fee receipt G-711 to replace the G-211. The Mexican NAFTA summary checklist, located on page 167, does not require the immigration inspector to collect a fee. The fee is not charged to Mexican citizens when applying for a NAFTA classification at the POE because fees are charged when filing the I-129 petition and for the issuance of the nonimmigrant visa.

RECOMMENDATION 5: Provide training to POE staff who will use the manual receipt process to ensure that the new procedures are sufficiently implemented, and require that each port director certify implementation of the new procedures.

INS RESPONSE: Concur. The INS Office of Financial Management is in the process of updating the Inspector's Field Manual to address the manual receipt process to include instructions. The INS HQ Office of Inspections with the HQ Office of Financial Management, will coordinate selected train-the-trainer instruction to involve members from the Regions and District offices to specifically address implementation of the new procedures. The Port Directors will be afforded a six-month time period to fully implement the new procedures and be required to certify, in writing, implementation of the new procedures.

RECOMMENDATION 7: Develop sufficient criteria and comparative reports for the periodic review and reconciliation of fee collection data in the Financial Accounting and Control System and the fee-related statistics in the Performance Analysis System to determine whether the INS is meeting its data integrity performance goals.

INS RESPONSE: Concur. In October 2000, the Office of Inspections developed a revised G-22.1 Performance Analysis System (PAS) Inspections Summary Report based on the Office of Inspector General recommendations and input from the Office of Financial Management. The Office of Inspections also revised the Inspections Activity Workload Records Report Procedures in October of 2000. The Office of Management's response to recommendation number 1 and number 6 develops guidance and controls to ensure adequate reconciliation of fees collected and appliciations processed.

RECOMMENDATION 8: Assess and modify accordingly, the Inspection Summary Report (G-22) to consistently report fee collections and waivers of fees separately for applications requiring a fee.

INS RESPONSE: Concur. As mentioned in recommendation number 7 above, the Office of Inspections revised the G-22.l Performance Analysis System (PAS) Inspections Summary Report based on the Office of Inspector General recommendations. The fees paid and fees waived statistics are clearly broken out in the revised G-22.l report.

The Executive Associate Commissioner will issue a memorandum to field managers mandating compliance with the Administrative Manual Policy Statement 3.1.101, Inspections Activity Workload Records, (Forms G-22.l & G-22.1F) Report Procedures.

If you have any questions, please contact Michael D. Cronin, Assistant Commissioner, Office of Inspections, at (202) 514-8223.