A review by the IG offices of 20 agencies of purchase card transactions identified as high risk of being improper did not find evidence of fraud but it did find weaknesses in policy, monitoring and training that increased the risk.
A report by the IG council on the joint effort is the latest in a long line of audits and policy initiatives aimed at curbing misuses of the cards, which are designed to streamline the payment process for small purchases. The 20 agencies involved in the audit accounted for 1.8 million purchases worth just under $1 billion in the six-month period ending in March 2017. Of those, auditors identified more than 560,000 as potentially improper and looked closely at a sample of some 1,200 from the 25 percent deemed at the highest risk.
They found 501 did not comply with one or more of the policies against: splitting transactions to keep the total under thresholds where more formal procurement would be required; paying state or local sales taxes from which the federal government is exempt; purchases from unauthorized individual merchants; or purchases from unauthorized or questionable merchant categories.
“The OIGs found that agencies’ cardholders need additional training in properly using their cards; agencies need to develop additional policies and procedures for the cards; and approving officials need to better review transactions,” the report said.
It recommended that OMB remind agencies of their responsibilities in managing the cards and that agencies refocus on controls such as training, policies and procedures, separation of duties, and supervisory reviews of transactions.