Wednesday, October 12, 2011
The Treasury Inspector General for Tax Administration
yesterday released Controls Over the Purchase Card Program Were Not Effective in Ensuring Appropriate Use
From September 1, 2007, through March 31, 2009, the IRS made more than 174,000 purchases totaling more than $80 million using purchase cards. However, the IRS does not have the necessary controls in place to ensure that improper and abusive purchases do not occur, any such transactions are promptly detected, and appropriate corrective action is taken.
While some controls were working as intended, overall management controls were not effective to ensure the appropriate use of IRS purchase cards. TIGTA found violations of applicable laws and regulations that included purchases made without necessary approvals and verification of funding, purchases that were potentially split into two or more transactions to circumvent micro-purchase limits, and purchases made from improper sources. In addition, the IRS did not have a policy to provide guidance for establishing an appropriate span of control over the number of purchase cardholders assigned to approving officials. Until management controls are effectively strengthened, implemented, and enforced, the IRS will continue to be at risk for noncompliance with applicable laws and regulations, and the IRS cannot ensure that improper and abusive purchases do not occur. In addition, if such purchases do occur, the IRS cannot ensure the transactions are promptly detected and that appropriate corrective action is taken.