The IRS needs to improve oversight of employee use of credit cards for small purchases, the Treasury Inspector General for Tax Administration has said.
From September 2007 – March 2009 IRS employees made $80 million in purchases using about 4,300 credit cards.
TIGTA said if found numerous instances in which cardholders made purchases without necessary approvals and verification of funding; 2,955 purchases that were potentially split into two or more transactions to circumvent micro-purchase limits; and purchases made from improper sources.
“The IRS must develop the controls necessary to ensure that improper and abusive purchases do not occur, that any such transactions are promptly detected, and that appropriate corrective actions are taken,” said J. Russell George, Treasury Inspector General for Tax Administration.
In response to the report, the IRS has changed its reviews of split-purchase transactions and expanded oversight reviews to include the use of contract vendors and preferred sources.
The report also said IRS officials plan to provide guidance on oversight and enforcement responsibilities; develop examples and scenarios that constitute a split purchase; review the potential split purchases TIGTA identified; and review and develop a policy concerning the current span of control on purchase cards.