TIRNO-99-D-0005, Report on
Compliance With Requirements Applicable to Major Programs and on Internal
Control Over Compliance in Accordance With the Office of Management and Budget
Circular A-133, Fiscal Year 2003
August 2004
Reference
Number: 2004-1C-136
This
report has cleared the Treasury Inspector General For Tax Administration
disclosure review process and information determined to be restricted from
public release has been redacted from this document.
August 9, 2004
MEMORANDUM FOR DAVID A. GRANT
DIRECTOR OF PROCUREMENT
INTERNAL REVENUE SERVICE
FROM: Daniel R. Devlin /s/ Daniel R. Devlin
Assistant Inspector General
for Audit (Headquarters Operations and
Exempt Organizations Programs)
SUBJECT: TIRNO-99-D-0005, Report on Compliance
With Requirements Applicable to Major Programs and on Internal Control Over
Compliance in Accordance With the Office of Management and Budget Circular
A-133, Fiscal Year 2003 (Audit #20041C0236)
The
Defense Contract Audit Agency (DCAA) audited the contractor’s compliance with
the requirements described in the Office of Management and Budget Circular
A-133 Compliance Supplement that are applicable to its major Federal Government
programs. The DCAA also audited the
contractor’s January 8, 2004, certified final indirect cost rate proposal and
related books and records for reimbursement of Fiscal Year 2003 incurred
costs. The purpose of the audit was to
determine the allowability and allocability of direct and indirect costs and form
the basis for negotiated indirect cost rates for the period ended October 5,
2003.
The
DCAA questioned $49,812 of overhead and $89,234 of General and Administrative
(G&A) costs. The Internal Revenue
Service’s (IRS) portion of the questioned costs were $1,183 in overhead and
$4,336 in G&A costs. In addition,
the DCAA reallocated $211,990 of corporate G&A expenses to the
sponsors. This resulted in an increased
allocation to the IRS of $159,076.
The
DCAA noted claimed direct costs, subject to the qualification stated below, are
provisionally approved pending final acceptance. The audit of direct costs disclosed no exceptions at this time.
The
DCAA stated that another Federal Government audit organization has audit
responsibility for the direct costs claimed on programs identified as Special
Projects. The DCAA was able to evaluate
the indirect costs applicable to this organization. However, the DCAA was unable to satisfy itself as to the
contractor’s compliance with Circular A-133 requirements or the allowability of
the direct costs. The DCAA qualified
its audit report because results of the assist audits evaluating these costs
had not been received.
The
information in this report should not be used for purposes other than those
intended without prior consultation with the Treasury Inspector General for Tax
Administration regarding their applicability.
If you have any questions, please
contact me at (202) 622-8500 or John R. Wright, Director, at (202) 927-7077.
Attachment
NOTICE:
The Office of Inspector General for Tax Administration has
no objection to the release of this report, at the discretion of the
contracting officer, to duly authorized representatives of the contractor.
The contractor information contained in this report is
proprietary information. The
restrictions of 18 U.S.C. § 1905 must be followed in
releasing any information to the public.
This report may not be released without the approval of
this office, except to an agency requesting the report for use in negotiating
or administering a contract with the contractor.
The TIGTA seal was removed due
to its size.