Functional Statements > Office of the Chief Financial Officer

C. Financial Improvement and Post Audit Operations

Financial Improvement and Post Audit Operations (FIPAO) provides leadership and direction in the areas of internal control assessment, financial management training, post audit activities and indirect cost determination.

In carrying out its responsibilities, FIPAO:

• Develops and implements Departmental policies related to audit follow-up
• Oversees the Department's audit resolution operations.
• Resolves discretionary grant audits and various formula grant audits for the Department.
• Negotiates indirect cost rates on behalf of the Federal Government for all State Education Agencies and other entities in which the Department holds a predominate financial interest.
• Develops and implements indirect cost policy.
• Coordinates non-FSA improper payment risk assessment.
• Designs and implements internal audit initiatives to reduce risks in the Department’s lines of business
• Develops and directs the Department's implementation of the requirements for the Federal Managers' Financial Integrity Act of 1982 and OMB Circular A-123, Internal Control Systems

The Director, FIPAO, reports to the CFO. The Director provides overall leadership and coordination to the immediate office staff of FIPAO and to the following components:

Post Audit Group;
Indirect Cost Group; and
Internal Control Evaluation Group

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Post Audit Group

The Post Audit Group is responsible for policy development, implementation and oversight for the Department's response to the Inspector General Act of 1988 (P.L. 100-504) and OMB Circulars A-50, Audit Follow-up; and A-133, Audits of States, Local Governments, and Non-Profit Organizations. The office also resolves A-13 discretionary grant audits and various formula grant audits. The Group leads Department's triage activities and serves as the focal point for management policies and procedures related to internal audits issued by the Office of Inspector General and General Accounting Office audits.

In carrying out its responsibilities, the Group:

• Prepares and publishes the Department's Semiannual Report to Congress on Audit Follow-up.
• Develops and issues Department internal and external audit status reports.
• Develops policy and provides oversight for the Department’s internal and external follow-up activities.
• Oversees revisions to the Handbook for the Post Audit Process and the Users’ Manual for Audit Accountability and Resolution Tracking System (AARTS).
• Resolves discretionary grant audits in addition to cash management and sub-recipient monitoring audit findings related to formula grants, and prepares Program Determination Letters (PDLs) and Audit Control Documents (ACDs).
• Processes single audits of state and local governments and non-profit organizations.
• Analyzes, reports, and forecasts non-recoverable funds related to audit resolution due to statute of limitations.
• Manages the enhancement and maintenance of the agency’s Audit Accountability and Resolution Tracking System (AARTS).

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Indirect Costs Group

The Indirect Cost group is responsible for developing, implementing and managing the Department’s indirect cost policy in accordance with OMB Circulars A-87, Costs Principles for State, Local, and Indian Tribal Governments, and A-122, Cost Principles for Non-Profit Organizations.

In carrying out its responsibilities, the Group:

• Negotiates and establishes indirect cost rates on behalf of the Federal Government for all State Education Agencies; and negotiates and establishes indirect cost rates for other State agencies where the Department holds a predominant financial interest.
• Negotiates and establishes indirect cost rates on behalf of the Federal Government for Institutions of Higher Education, nonprofits, and commercial firms where the Department holds a predominant financial interest.
• Negotiates and settles liabilities resulting from excessive indirect cost reimbursement, resolves audits on indirect cost issues, and administers any related appeals.
• Provides technical advice to external and internal customers on cost allocation issues under grants and contracts.
• Serves as the Department's liaison with OMB on fulfilling the cognizant agency responsibilities for cost policy and oversight.
• Oversees the program where States may receive delegations of authority to administer indirect cost oversight for their Local Education Agencies.
• Develops and implements indirect cost policy.

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Internal Control Evaluation Group

The Internal Control Evaluation Staff is responsible for providing assurance that the Department is in compliance with numerous legislative and regulatory requirements that promote and support effective financial management and financial control. The Staff focuses on providing leadership in conducting internal control reviews, risk assessments, monitoring, performance analysis, and internal controls training.

In performing its responsibilities, the Staff:

• Designs and implements internal audit initiatives to reduce risks in the Department’s lines of business. Ensure that the initiatives address all relevant legislative and regulatory requirements that promote and support effective internal control and financial management.
• Develops and directs the Department’s implementation of the requirements for the Improper Payments Information Act of 2002; provides assistance Principal Offices by reviewing and identifying programs and activities that may be susceptible to significant improper payments, developing estimates of improper payments, and developing corrective actions to reduce improper payments and monitor the timely completion of corrective actions.
• Develops and implements Department-wide financial management and internal control training.
• Develops and directs the Department's implementation of the requirements for the Federal Managers' Financial Integrity Act of 1982 and OMB Circular A-123, Internal Control Systems
• Develops and implements financial management improvement projects.

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