Federal Manager's Daily Report

The Department of Housing and Urban Development does not

have an effective internal control system in place to

maintain accountability over its computer equipment — on

which it reportedly spent $59 million from fiscal 2001 —

2003, the General Accounting Office said in a letter to

the Senate Appropriations Committee.


A GAO report from 2003 raised concerns about HUD

accountability for computer-related equipment bought with

purchase cards when it could not find supporting

documentation on recent purchases. Indeed HUD acknowledged

that it did not consistently enter supporting information

into its asset management system, which increased the

potential for loss or theft of computer assets.


The letter said fundamental internal control activities

were not performed on computers and related equipment,

and that HUD did not perform regular physical inventories

to verify the quantities and location of computer equipment.


HUD has awarded a new information technology contract

for information processing, telecommunications, and

related needs on an agency wide basis, but will still be

accountable for HUD-owned equipment at least through

fiscal year 2006, according to the letter. But GAO

warned that until HUD corrects the weaknesses in its

internal controls it would face problems with

accountability and vulnerability.