Follow-up Audit of the Department of Justice Counterterrorism Fund
Report No. 03-33
Office of the Inspector General
We have completed a follow-up audit of the Department Counterterrorism Fund, which is administered by JMD. The objectives of the audit were to determine: 1) if the Fund expenditures were authorized, supported, and made in accordance with the intent of the law, and 2) if JMD has taken appropriate efforts to close RAs in an expeditious manner.
Scope and Methodology
We performed our audit in accordance with Government Auditing Standards issued by the Comptroller General of the United States, and accordingly included such tests of the records and procedures that we considered necessary. The audit covered the period between October 1, 1997, and September 10, 2002, and included funds provided to Department components as well as to other federal, state, and local agencies.
Department Components - The audit included a detailed review of RAs between Department components and JMD for FYs 1998 through 2002, amounting to $93,999,316.44 Audit work was performed at the following agencies:
At each component, we performed tests of selected records and transactions and followed up with responsible personnel. Additionally, at JMD, we interviewed personnel regarding its oversight of the Fund and we reviewed the Fund legislation, the RAs, and billing documentation for our review period.
To determine if Fund expenditures were authorized, supported, and made in accordance with the intent of the law, we judgmentally selected and reviewed a sample of transactions. The transactions were selected from detailed listings of expenditures obtained from each of the agencies. As of the date of our fieldwork, the universe of expenditures amounted to $85,114,623. Generally, for each RA we reviewed 10 percent of the number of transactions in the universe of disbursements with a maximum of 100 transactions; half of our sample was chosen by random selection, while the other half consisted of high dollar transactions.45 In addition, we selected transactions that were greater than or equal to $100. However, we had to modify our sampling methodology for the Criminal Division, EOUSA, and the FBI. Following are the modifications that were necessary for these components:
For each transaction selected, we reviewed supporting documentation such as requisitions, invoices, travel vouchers, vendor receipts, reimbursable work authorizations, accounting and payment records, and purchase orders. Our sample amounted to $36,007,218, or 42 percent of the universe.
EXPENDITURE TESTING FOR DEPARTMENT COMPONENTS
UNIVERSE AND SAMPLE SIZE46
In addition to the expenditure testing detailed above, we analyzed $7,987,480 in FBI overtime costs related to the World Trade Center and Pentagon attacks. These expenses are not included in the expenditure testing of the Department components discussed above due to differences in our methodology. While the expenditure testing included a detailed examination of source documents to determine if the expenses were authorized, supported, and used in accordance with the intent of the law, our review of these FBI overtime costs did not. The FBI did not have a tracking system from the onset that tagged overtime as being related to the September 11 attacks. As a result, the FBI was unable to determine the exact amount of overtime costs related to the bombings and instead calculated an estimate using historical data. We reviewed the FBI's computation of overtime costs and found that the amount charged to the Fund was reasonable.
Non-DOJ Components - Our audit also included a detailed review of funds provided to non-DOJ components related to RAs executed between FYs 1998 through 2002, amounting to $3,966,550.47
For the funds provided to the city of Ogden, Utah, we: 1) interviewed responsible personnel about requests for reimbursement, Fund expenditures, tracking systems, and billing practices; and 2) performed tests of selected records and transactions. Further, we obtained necessary documents (e.g., the grant agreement, billing documents, memoranda) from the JMD Finance Staff.
For the other non-DOJ components that were responsible for reporting to the FBI, we attempted to perform tests of selected records and transactions. However, as reported in Finding 2, the FBI did not always obtain complete supporting documentation from the end-users and attempts to obtain the information from the end-users were ineffective.
To determine if the Fund expenditures of the non-DOJ agencies were authorized, supported, and used in accordance with the intent of the law, we judgmentally selected and reviewed a sample of transactions. The transactions were selected from the available detailed listings of expenditures. As of the date of our fieldwork, the universe of expenditures amounted to $2,832,946. Generally, we utilized the same sampling methodology as we did for the Department components, which amounted to 10 percent of the number of transactions in the universe. However, we could not select any transactions from the Denver Police Department because that agency was unresponsive to the FBI's request for information. Further, we had to modify our sampling methodology for the city of Ogden and the USDA Forest Service, as follows:
Our sample of pass-through funding amounted to $2,324,541, or 82 percent of the universe.
EXPENDITURE TESTING FOR NON-DOJ COMPONENTS
UNIVERSE AND SAMPLE SIZE48
For each transaction selected, we attempted to review supporting documentation such as requisitions, invoices, vendor receipts, reimbursable work authorizations, accounting and payment records, and purchase orders. For the instances in which neither the pass-through agency nor the end-user could provide the necessary transaction listings or detailed support we requested, our sample size reflected 100 percent of the universe because we questioned the entire amount reimbursed as unsupported.
In the aggregate, we reviewed expenditures totaling $46,319,239 and consisting of: 1) $36,007,218 in Department component expenditures; 2) $7,987,480 in FBI overtime costs related to the World Trade Center and Pentagon attacks; and 3) $2,324,541 in funds provided to non-DOJ components.