Summary

Pursuant to a congressional request, GAO investigated: (1) the size of the backlog in redeemed commodity certificates that the Agricultural Stabilization and Conservation Service (ASCS) has not reconciled to issuance records; (2) ASCS plans for resolving the backlog; and (3) the extent to which the Department of Agriculture (USDA) has achieved a mandated $230-million reduction in storage, transportation, and handling expenditures for fiscal years 1988 and 1989.

GAO found that the ASCS Kansas City Management Office, which is responsible for issuing and redeeming certificates: (1) reported that the backlog of redeemed certificates with unresolved exceptions increased from over 170,000 in January 1988 to over 204,000 in April 1988 and would increase to about 320,000 by October 1988; (2) assigned 11 personnel to research and correct unreconciled certificates; (3) concentrated on unmatched redeemed certificates because of the large backlog in that category; (4) did not keep detailed records on the number of exceptions occurring each month, but estimated that it corrected about 25,000 each month; and (5) did not have a plan to resolve the increasing backlog, but outlined eight proposed backlog reduction plans as part of its year-end closing plan, which included developing software, writing off low-dollar-value exceptions, and assigning priorities to certain categories of exceptions. GAO also found that ASCS: (1) has not identified the root cause of the backlog to minimize the occurrence of future exceptions; (2) did not report that a material weakness existed in this area in its 1987 Financial Integrity Act report; and (3) projected a $610-million reduction in storage, transportation, and handling expenditures due to a significantly lower volume of government-owned grain.