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Report Contributors: Paul Curtis
Meg Hiatt
Arthur Budelier
Gloria Taylor-Upshaw
Catherine Allen
Kelly Bonnette
Robert Hairston
Carol Kwok
Mairim Lopez
Claire McWilliams
Demetrios Papakonstantinou
Denise Patten
Robert Smith
Wendy Swan
Lynda Taylor
Abbreviations
EPA
U.S. Environmental Protection Agency
FY
Fiscal Year
GAO
U.S. Government Accountability Office
GL
General Ledger
IFMS
Integrated Financial Management System
OCFO
Office of the Chief Financial Officer
OIG
Office of Inspector General
OMB
Office of Management and Budget
Hotline
To report fraud, waste, or abuse, contact us through one of the following methods:
e-mail: OIG Hotlirie@epa.aov write: EPA Inspector General Hotline
phone: 1-888-546-8740 1200 Pennsylvania Avenue NW
fax: 202-566-2599 Mailcode 2431T
online: http://www.epa.gov/oiq/hotiine.htm Washington, DC 20460
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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
12-P-0559
July 9, 2012
Why We Did This Review
The purpose of this audit was to
determine whether the U.S.
Environmental Protection Agency
(EPA) effectively managed the
implementation of Compass so
that there is a clear cutoff
between transactions entered in
the Integrated Financial
Management System (IFMS) and
Compass Financials (Compass).
We also sought to determine
whether EPA properly migrated
financial data to Compass from
IFMS.
Background
In October 2011, the EPA's
Office of the Chief Financial
Officer replaced IFMS with
Compass—a new system. All
relevant reference and general
ledger (GL) data were to be
migrated to Compass from IFMS.
The conversion and migration
strategies included the conversion
of the ending balances from
IFMS identified during the annual
closing into the beginning
Compass balances for fiscal year
(FY) 2012.
For further information, contact
our Office of Congressional and
Public Affairs at (202) 566-2391.
The full report is at:
www.epa.gov/oiq/reports/20121
20120709-12-P-0559.pdf
EPA Did Not Properly Migrate General Ledger
Balances to Compass From the Integrated
Financial Management System
What We Found
EPA did not properly migrate GL balances to Compass from IFMS. We found
differences in certain FY 2012 beginning balances, abnormal balances, and
Agency adjustments to beginning balances. The Federal Managers' Financial
Integrity Act requires agencies to provide reasonable assurance that accounts
are properly recorded and accounted for to ensure reliability of financial
reporting. The errors we found are indicators of internal control and oversight
weaknesses in the migration of balances.
The Agency stated that the differences were due to the mapping for vendor code
information, trading partner designations, and corrections to budget entries.
These errors occurred because EPA did not properly review and populate
vendor-type information and ensure proper oversight of the migration plan.
The Agency did not provide detailed support for the beginning balances, the
abnormal balances, or the adjustments to beginning balances, so we could not
fully determine the nature of the errors.
Because of the GL account differences and the lack of supporting details,
EPA cannot ensure the reliability of the FY 2012 balances used to generate the
financial statements. Without this reliance and proper support for balances, we
may not be able to render an unqualified opinion when we audit the FY 2012
financial statements.
Recommendations/Agency Corrective Actions
We recommend that the Chief Financial Officer determine whether the
supporting data elements in the beginning balances of the GL account and
treasury symbol were properly migrated to Compass from IFMS; adjust the
GL accounts with abnormal balances to include accurate activity and reflect the
proper balances; and correct the GL Crosswalk and provide the details to the
EPA Office of Inspector General.
We informed the Agency of issues identified in this report. The Agency stated it
has taken corrective actions and will provide supporting documentation. We
will assess the Agency's corrective actions during the FY 2012 financial
statement audit.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
THE INSPECTOR GENERAL
July 9, 2012
MEMORANDUM
SUBJECT: EPA Did Not Properly Migrate General Ledger Balances to
Compass From the Integrated Financial Management System
Report No. 12-P-0559
FROM: Arthur A. Elkins, Jr.
TO:
Barbara J. Bennett
Chief Financial Officer
This is a quick reaction report on our review of the Fiscal Year 2012 General Ledger beginning
balances in Compass conducted by the Office of Inspector General (OIG) of the U.S.
Environmental Protection Agency (EPA). This report contains time critical issues needing your
attention. This report represents the opinion of the OIG and does not necessarily represent the
final EPA position. Final determinations on matters in this report will be made by EPA managers
in accordance with established audit resolution procedures.
Action Required
In accordance with EPA Manual 2750, please provide a written response to this report within
30 calendar days. You should include a corrective action plan for agreed-upon actions, including
milestone dates. Your response will be posted on the OIG's public website, along with our
memorandum commenting on your response. Your response should be provided as an Adobe
PDF file that complies with the accessibility requirements of Section 508 of the Rehabilitation
Act of 1973, as amended. The final response should not contain data that you do not want to be
released to the public; if your response contains such data, you should identify the data for
redaction or removal. We have no objections to the further release of this report to the public.
We will post this report to our website at http ://www.epa. gov/oig/.
If you or your staff have any questions regarding this report, please contact Melissa Heist,
Assistant Inspector General for Audit, at (202) 566-0899 or heist.melissa@epa.gov: or
Paul Curtis, Product Line Director for Financial Statement Audits, at (202) 566-2523 or
curtis. paul@,epa. gov.
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EPA Did Not Properly Migrate General Ledger Balances to
Compass From the Integrated Financial Management System
12-P-0559
Table of Contents
Purpose 1
Background 1
Scope and Methodology 2
Results of Review 3
Criteria 3
Differences Between FY 2011 Ending Balances and FY 2012
Beginning Balances 5
Differences Between FY 2011 Ending Balances and FY 2012
Beginning Balances at the Treasury Symbol Level 5
Abnormal Balances 6
Beginning Balance Adjustments 6
General Ledger Crosswalk Errors 7
Conclusion 7
Recommendations 8
Agency Corrective Actions 8
Status of Recommendations and Potential Monetary Benefits 9
Appendices
A Details on Scope and Methodology 10
B Differences Between FY 2011 Ending Balances and FY 2012
Beginning Balances 12
C Differences Between FY 2011 Ending Balances and FY 2012
Beginning Balances at the Treasury Symbol Level 14
D Abnormal Beginning Balances in Compass 21
E Beginning Balance Adjustments Due to Migration, Mapping Errors,
and Budget Corrections 22
F General Ledger Crosswalk Errors 23
G Effect on Audit of Data Requests Not Received 24
H Distribution 25
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Purpose
The purpose of this audit was to determine whether the U. S. Environmental
Protection Agency (EPA):
• Effectively managed the implementation of Compass so there is a clear
cutoff between transactions entered in the Integrated Financial
Management System (IFMS) and Compass.
• Properly migrated financial data to Compass from IFMS so that the
beginning balances and details of those balances are properly stated in the
new system.
Background
In October 2011, EPA's Office of the Chief Financial Officer (OCFO) replaced
IFMS with anew system—Compass Financials (Compass). EPA's data migration
activities were critical to the implementation of the Compass system. EPA, in
conjunction with its contractor, converted and migrated the data to the new
Compass financial management system.
The objectives of Compass are to:
1. Achieve or enhance process improvements and cost savings in the
acquisition, development, implementation, and operation of financial
management systems through shared services, joint procurements,
consolidation, and other means.
2. Provide for standardization of business processes and data elements.
3. Promote seamless data exchange between and among federal agencies.
4. Strengthen internal controls through real-time interoperability of core
financial and subsidiary systems.
OCFO's Office of Technology Solutions managed the conversion and migration
strategies that define the scope of the transactions that were converted. All
relevant reference and general ledger (GL) data were to be migrated. The GL is a
collection of the group of accounts that supports items shown in the major
financial statements. The conversion and migration strategies included the
conversion of the ending balances from IFMS identified during the annual closing
into the beginning Compass balances for fiscal year (FY) 2012.
EPA's IFMS GL Migration Design and Migration Strategy documents describe
the conversion of the GL beginning balances to Compass from IFMS as part of
EPA's financial system modernization project. The documents contain the
objectives, assumptions, and controls for EPA's GL account balance conversion
and financial migration effort. Prior to performing the conversion, the IFMS data
needed to be crosswalked via the Crosswalk Engine so the fiscal strip elements
12-P-0559
1
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and GL accounts were in the same format as the data converted. The migration
strategy included a step to reconcile the FY 2011 financial data converted via
journal voucher documents back to IFMS. The beginning balance reconciliation
was designed to compare dollar amount fields as well as the GL account and
accounting strip (e.g., beginning budget fiscal year, ending budget fiscal year,
fund code). This also includes non-accounting strip data such as vendor and
projects. Any discrepancies found between the two extractions were to be
documented. The details of the beginning balance reconciliation process would
also be documented as part of the conversion reconciliation design.
The contractor developed the migration processing model or mapping for each
conversion component. GL data was the final component of the migration process.
In this process, the contractor converted the beginning balances for FY 2012 from
IFMS to Compass by the creation of journal vouchers. All reference data
(e.g., vendor code, fund code, etc.) were converted prior to the execution of the
beginning balance conversion. The migration mapping included the use of vendor
codes for the conversion of the beginning balance records. EPA used generic
vendor codes (one generic vendor code for federal and one for nonfederal) for
records where the vendor-type value was missing at the time of production.
The migration design provided the following assumptions and steps to be completed:
• EPA is in the process of cleaning up the beginning balance records in
IFMS to populate the vendor-type value when it is missing.
• EPA is in the process of cleaning up the beginning balance records in
IFMS to populate the trading partner value when it is missing.
• EPA will provide an accurate GL account crosswalk and vendor-
type/Federal Agencies' Centralized Trial-Balance System Department
Identification crosswalk in a timely manner, consistent with the migration
schedule.
• The GL conversion process will include a reconciliation of the converted
beginning balance data to IFMS ending balance data.
Scope and Methodology
We conducted our audit from December 8, 2011, to July 9, 2012, in accordance
with generally accepted government auditing standards. Those standards require
that we plan and perform the audit to obtain sufficient, appropriate evidence to
provide a reasonable basis for our findings and conclusions based on our audit
objectives. We believe that the evidence obtained provides a reasonable basis for
our conclusions based on our audit objectives. This information and results in this
report are based on data and information received by March 23, 2012. Corrective
actions taken by the Agency after that date are not included in this report. We will
assess the corrective actions taken during the FY 2012 financial statement audit.
12-P-0559
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We compared FY 2011 adjusted ending balances in IFMS to the FY 2012
beginning balances in Compass to determine if they agreed. We reviewed
FY 2012 beginning balances to identify abnormal beginning balances. We
reviewed the GL crosswalk to determine if it was reasonable. We reviewed EPA
policies and guidance. We reviewed documents for the GL accounts as well as
EPA's Compass financial management system. We also interviewed personnel
from the Las Vegas Finance Center, Cincinnati Finance Center, Research Triangle
Park Finance Center, Office of Financial Management, and Office of Technology
Solutions regarding the migration of account balances to Compass from IFMS.
Appendix A contains further details on our scope and methodology.
Results of Review
GL balances did not properly migrate to Compass from IFMS. We found
differences between 46 FY 2012 Compass beginning balances and FY 2011 IFMS
ending balances. We found 17 accounts that had abnormal balances. An account
balance is abnormal when it does not match the normal debit or credit balance
associated with that account. We found that EPA adjusted beginning balances in
17 accounts.
The Federal Managers' Financial Integrity Act, Section 2, requires agencies to
establish accounting and administrative controls to provide reasonable assurances
that the agency's operations are properly recorded and accounted for to ensure
reliability of financial reporting. The errors we found are indicators of internal
control weaknesses and oversight weaknesses in the migration of balances. We
asked EPA for detailed support for the beginning balances, and explanations for
the differences, adjustments to beginning balances, and abnormal balances. The
Agency did not provide the detailed support. Therefore, we could not fully
determine the nature of the errors. The Agency stated that the differences in
account balances, the adjustments to beginning balances, and abnormal balances
were due to issues with the mapping for vendor code information, trading partner
designations, and corrections to budget entries.
These errors and lack of supporting documentation are evidence of material
control weaknesses and inadequate oversight. Such errors and lack of supporting
details indicate EPA cannot provide reasonable assurances the FY 2012 balances
are properly recorded and ensure the reliability of the financial statements.
Without this reliance and proper support for the balances, we may not be able to
render an unqualified opinion when we audit the FY 2012 financial statements.
Criteria
We reviewed laws and regulations, federal guidance, and EPA financial policies
associated with EPA's financial migration, including the Federal Managers'
Financial Integrity Act; the U.S. Government Accountability Office's (GAO's)
Standards on Internal Controls in the Federal Government; OMB Circulars; and
12-P-0559
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EPA policies and guidance, such as Resources Management Directives System
2540-20, Financial Management Systems and Interfaces.
• The Federal Managers' Financial Integrity Act of 1982, Section 2, states:
To ensure compliance with the requirements ... internal
accounting and administrative controls of each executive
agency shall be established in accordance with standards
prescribed by the Comptroller General, and shall provide
reasonable assurances that -
(i) obligations and costs are in compliance with
applicable law;
(ii) funds, property, and other assets are safeguarded
against waste, loss, unauthorized use, or
misappropriation; and
(iii) revenues and expenditures applicable to agency
operations are properly recorded and accounted for
to permit the preparation of accounts and reliable
financial and statistical reports and to maintain
accountability over the assets.
• GAO's Standard for Internal Control in the Federal Government states:
The control activities should be effective and efficient in
accomplishing the agency's control objectives. Control
activities occur at all levels and functions of the entity.
• OMB Circular A-123, Management's Responsibility for Internal Control,
states:
Periodic reviews, reconciliations or comparisons of data
should be included as part of the regular assigned duties of
personnel. Periodic assessments should be integrated as
part of management's continuous monitoring of internal
control.
• EPA's Resources Management Directives System 2540-20, Financial
Management Systems and Interfaces, Section II. A, states:
All accounting transactions and interfaces will be
processed, reconciled, and resolved in accordance with
the guidance set forth by OMB.
12-P-0559
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The policy also states that:
All financial accounting transactions and events, budget
execution related and proprietary, must be fed or input
into EPA's IFMS or its replacement.
The aforementioned laws and federal and Agency guidance require the Agency to
have internal accounting and administrative controls and continuously monitor
their effectiveness. The errors we found and that are listed below indicate the
existing controls are either not effective or are otherwise inadequate to prevent or
detect errors.
Differences Between FY 2011 Ending Balances and
FY 2012 Beginning Balances
EPA did not properly migrate financial data to Compass from IFMS at the EPA
GL account level. We identified differences in 46 GL accounts. These differences
indicate that IFMS did not migrate properly to Compass and may be an indication
of potential errors at the transaction level and, ultimately, in the FY 2012 ending
balances. Upon request, the Agency provided explanations for the differences in
GL account balances, but did not provide detailed support for the differences or
the beginning balances. Therefore, we cannot determine whether the beginning
balances are accurate. The Agency stated:
Beginning balances were loaded into Compass based on the vendor
code information from IFMS. If the vendor code was not included
on a transaction posted to a federal GL account in IFMS, the
amount was loaded into a non-federal account in Compass.
Although the Agency was aware that the migration was vendor driven, the
vendor-type errors demonstrate that it did not perform a verification process of all
vendor-type entries on the transactions posted in IFMS before the
migration/conversion, which is an illustration of internal control and oversight
weaknesses in the migration of balances. Because of the internal control
weaknesses, material changes in balances, and lack of detailed support, we cannot
rely on the Compass beginning balances. See appendix B for differences between
the FY 2011 ending balances and the FY 2012 beginning balances.
Differences Between FY 2011 Ending Balances and
FY 2012 Beginning Balances at the Treasury Symbol Level
EPA did not properly migrate financial data to Compass from IFMS at the
treasury symbol level. Using the data noted above, we compared the IFMS
GL account balances to the Compass balances at the treasury symbol level.
We identified 201 differences in GL account balances by treasury symbol.
Differences in balances at the treasury symbol level indicate that financial data
12-P-0559
5
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may not be accurate and reliable for reporting and decision making purposes.
See appendix C for differences identified in GL accounts by treasury symbol.
Abnormal Balances
We identified abnormal beginning balances in 17 GL accounts. An account
balance is abnormal when it does not match the normal debit or credit balance
associated with that account. For example, a credit balance in an expense account
that normally has a debit balance would be abnormal. A debit balance in a
liability account that normally has a credit balance would be abnormal. The
Agency stated that it performed reconciliations at the U.S. Government Standard
General Ledger level. Had EPA performed reconciliations at the EPA GL level, it
would have identified the abnormal balances. The Agency further stated:
The remaining GL abnormal balances were due to the inaccurate
migration of IFMS data to Compass because Compass beginning
balances were loaded based on vendor code information from
IFMS. If the vendor code was not included on a transaction posted
to a federal GL account in IFMS, the amount was loaded into a
non-federal account in Compass.
Abnormal balances resulting from migration errors indicate account balances are
not recorded properly, and internal controls did not function properly and were
inadequate. Further, this demonstrates that EPA did not do a reconciliation of
beginning balance migrated data. If not corrected, the balances for the end of
FY 2012 could be materially misstated. See appendix D for accounts with
abnormal balances.
Beginning Balance Adjustments
We identified 17 accounts in which the beginning balances were adjusted because
of migration errors, mapping errors, and budget corrections. We requested
explanations and support for the adjustments to beginning balances. The Agency
stated:
The Compass conversion program transferred the trading partner
"00" balances to the federal accounts and the blank trading partner
balances to non-federal accounts in most cases. To ensure the
movement of the amounts back into the federal accounts is
reported correctly and properly nets, a generic vendor code
CVFEDF0000 was added on the federal side for those amounts
that previously had no trading partner identifier.
12-P-0559
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The Agency also stated that three Appropriation Authorization1 documents were
entered into accounting period 00 to bring the budget balances in line with what
was reported on the Report of Budget Execution (SF-133). Because the
Appropriation Authorizations posted to the GL, they caused a discrepancy with
what had been in IFMS. The Agency did not provide the detailed support for the
adjustments in Compass.
Adjustments to the beginning balances also indicate that FY 2011 ending balances
did not migrate properly and represent inadequate internal controls over the
migration of data. These adjustments may also be an indication of possible errors
at the transaction level. Without support for what makes up these adjustments, we
have no assurance that the details and balances are correct. See appendix E for the
beginning balance adjustments due to migration, mapping errors, and budget
corrections.
General Ledger Crosswalk Errors
We found 20 instances in which EPA incorrectly matched IFMS and Compass
GL account numbers in their crosswalk. Additionally, EPA's Compass crosswalk
omitted one of the Compass GL accounts. While 17 of the 20 GL accounts with
crosswalk errors did not have balances to transfer between the systems, EPA
should not have had errors in the GL crosswalk during or after migration.
According to the contractor's IFMS GL Migration Design plan, updated
October 18, 2010, the contractor processed data through its Crosswalk Engine.
However, EPA management was responsible for providing the crosswalk to the
contractor. Because the conversion was dependent on the accuracy of EPA's GL
crosswalk, the crosswalk errors caused some GL balances to improperly migrate
to Compass. The Agency provided multiple crosswalks that indicate there were
subsequent changes and corrections to the initial crosswalk, and EPA did not
provide a proper crosswalk to the contractor. While the corrections may be
appropriate for future transactions, EPA should ensure that transactions processed
before the crosswalk was changed are corrected. Since there are errors in the
crosswalk, the beginning balances and, subsequently, ending balances could be
misstated. The multiple errors in the crosswalk demonstrate a control weakness
and indication of inadequate internal controls over the migration. See appendix F
for general ledger crosswalk errors.
Conclusion
EPA did not properly migrate general ledger balances from IFMS to Compass.
We found that the inadequate oversight of the internal controls over the migration
process resulted in differences in certain FY 2012 beginning balances, abnormal
GL balances, adjustments to beginning balances, and errors in the GL crosswalk.
We requested supporting documentation for the corrections and errors and, to
1 Appropriation Authorization documents are used to process budgetary authority in EPA's accounting system.
12-P-0559
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date, the Agency has not provided the support. The Agency stated that the
migration errors were due to the incorrect mapping of vendor code information,
errors in trading partner designations, and corrections to erroneous budget entries.
The Agency's migration strategy documents provided detailed instructions and
control procedures to ensure a proper migration from IFMS to Compass. Some of
these procedures include preparing the general ledger accounts for conversion by
verifying vendor-type data and trading partner values, providing an accurate GL
crosswalk, and performing reconciliations of converted beginning balance data.
Because we did not receive the supporting documentation, we cannot determine
whether the GL balances or adjustments to those balances are reasonable. EPA
faces a significant management challenge to reconcile account differences,
implement and ensure proper internal controls, and ensure its financial statements
are reliable. The migration errors identified, and the Agency's inability to provide
supporting documentation, cause concern about the ability to audit FY 2012 data
or render an unqualified opinion when we audit the FY 2012 financial statements.
Recommendations
We recommend that the Chief Financial Officer:
1. Perform a reconciliation of the supporting data elements in the GL account
beginning balances and determine whether they properly migrated to
Compass from IFMS. Document and record any adjustments as necessary.
2. Perform a reconciliation of the supporting data elements in the treasury
symbol beginning balances to determine whether they properly migrated
to Compass from IFMS. Document and record any adjustments as
necessary.
3. Adjust the general ledger accounts with abnormal balances to include
accurate activity and reflect the proper balances.
4. Correct and finalize the general ledger crosswalk, and provide the details
to the EPA Office of Inspector General.
Agency Corrective Actions
We informed the Agency of issues identified in this report. The Agency stated it
has taken corrective actions and will provide supporting documentation. We will
assess the Agency's corrective actions during the FY 2012 financial statement
audit.
12-P-0559
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Status of Recommendations and
Potential Monetary Benefits
RECOMMENDATIONS
POTENTIAL MONETARY
BENEFITS (in $000s)
Rec.
No.
Page
No.
Subject
Status1
Action Official
Planned
Completion
Date
Claimed Agreed-To
Amount Amount
1
8
Perform a reconciliation of the supporting data
elements in the GL account beginning balances
and determine whether they properly migrated to
Compass from IFMS. Document and record any
adjustments as necessary.
U
Chief Financial Officer
2
8
Perform a reconciliation of the supporting data
elements in the treasury symbol beginning
balances to determine whether they properly
migrated to Compass from IFMS. Document and
record any adjustments as necessary.
U
Chief Financial Officer
3
8
Adjust the GL accounts with abnormal balances to
include accurate activity and reflect the proper
balances.
u
Chief Financial Officer
4
8
Correct and finalize the general ledger crosswalk,
and provide the details to the EPA Office of
Inspector General.
u
Chief Financial Officer
1 0 = recommendation is open with agreed-to corrective actions pending
C = recommendation is closed with all agreed-to actions completed
U = recommendation is unresolved with resolution efforts in progress
12-P-0559
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Appendix A
Details on Scope and Methodology
We reviewed laws and regulations pertaining to the activities associated with the financial
migration, including EPA policies and guidance, such as Resources Management Directive
System 2540-20, Financial Management Systems and Interfaces; GAO's Standards on Internal
Control in the Federal Government; and the Federal Managers' Financial Integrity Act.
We obtained the FY 2012 period 00 Compass trial balance spreadsheet from EPA. The trial
balance spreadsheet contained the treasury symbols, GL accounts, and beginning balances. We
imported the spreadsheet into Interactive Data Extraction and Analysis and summarized the file
by GL account and amount. Using the GL account crosswalk spreadsheet provided by EPA as a
guide, we compared the FY 2011 ending balances in the IFMS GL accounts to the 2012
beginning balances in the Compass GL accounts. We identified any differences and questioned
EPA about these differences.
We also reconciled the FY 2011 ending balances to the FY 2012 beginning balances at the
treasury symbol level. We identified the FY 2011 treasury symbols from the journal file. We
compared the treasury symbols in IFMS to the treasury symbols in the Compass spreadsheet for
each GL account. For any differences identified, we asked the Agency to provide explanations
for the differences in the GL accounts at the treasury symbol level.
We performed independent queries of period 00 activity for each GL account. We extracted the
details of the beginning balances for the accounting period 00 in Compass. We sorted the data by
document number and subtotaled the data by document type (such as "BBCNV" and
"BEGBALCORR"). Based on our analysis, we identified activity other than "Conversion"
entries from IFMS to Compass. We requested explanations and supporting documentation for
each different "non-BBCNV" document, including the reason for the entry, why the entry was
made, and the source for the amounts in the entry.
We developed a questionnaire to obtain information from EPA staff involved with Compass. The
objective of the questionnaire was to determine and identify roles and responsibilities of staff
involved in the implementation of Compass, and to identify any problems encountered with the
migration.
Prior Reviews
We researched prior EPA Office of Inspector General (OIG) and GAO reports related to the
implementation of new financial systems. We noted two pertinent reports, as listed below:
• EPA OIG Report No. ll-P-0019, Improvements Needed in EPA's Efforts to Replace
Its Core Financial Systems, November 29,2010. We found that OCFO's management
control processes do not ensure compliance with EPA's System Life Cycle Management
policies and procedures necessary to provide reasonable assurance that efforts to replace
the Agency's core financial system achieve the desired results. OCFO proceeded with the
12-P-0559
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design sub-phase without obtaining executive management's approval of the revised
requirements or developing and obtaining required approval of the associated test plans,
as required by EPA's System Life Cycle Management procedure. Furthermore, OCFO
did not predetermine the acceptable product acceptance test script failure percentages to
be used as the basis of management's go/no-go decision on the project. These conditions
could result in a system that does not meet management's expectations and EPA's needs,
and/or does not comply with all applicable federal and EPA requirements.
• GAO Report No. GAO-08-1018, Persistent Financial Management Systems Issues
Remain for Many CFO Act Agencies, September 30, 2008. GAO found that agencies'
efforts to implement new systems far too often result in systems that do not meet cost,
schedule, and performance goals. Recent modernization efforts by some agencies have
been hampered by not following disciplined processes. To help avoid implementation
problems, OMB continues to make progress on its financial management line of business
initiative, which promotes business-driven, common solutions for agencies to enhance
federal financial management, but additional efforts are needed.
Internal Control Review
We reviewed and assessed the internal controls relevant to our audit objective of identifying
whether IFMS FY 2011 ending general ledger balances, and details of those balances, properly
migrated as FY 2012 beginning balances to Compass. To assess and determine the adequacy of
the controls over the migration, we gained an understanding of the financial system migration
process and reviewed relevant information or weaknesses identified. We gained an
understanding of the internal controls over the migration process through interviews of EPA's
OCFO personnel and reviews of applicable laws/regulations and EPA's policies and procedures.
In addition, we reviewed GAO reports, previous EPA OIG reports, other agency OIG reports, the
FY 2010 and 2011 management challenges identified by the OIG for the Agency, and EPA's
OMB Circular A-123 review.
To assess the reliability of the information systems used, we compared FY 2011 ending balances
in IFMS to FY 2012 beginning balances in Compass. We considered the IFMS data to be reliable
based on the EPA's FY 2011 audited financial statements. We determined that the Compass
system FY 2012 beginning balances were not reliable because the FY 2011 ending balances in
IFMS did not agree with the FY 2012 beginning balances in Compass. We verified any related
data in the Compass system by comparing it with the supporting documentation for beginning
balance corrections.
Based on results and conclusions, we found that EPA's internal controls over the data migration
from IFMS to Compass appeared inadequate. We found that general ledger balances did not
migrate properly from IFMS to Compass. The logic behind the migration from IFMS to
Compass was based on vendor type. However, the transactions in IFMS migrating to Compass
did not always list vendor type or a correct vendor type. Therefore, the general ledger accounts
were mapped incorrectly for the migration, which resulted in misstated and abnormal general
ledger beginning balances.
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Appendix B
Differences Between FY 2011 Ending Balances and
FY 2012 Beginning Balances
FY 11 00-1
File Post
7 Appended Journal
Close Trial Balance
Compass FY 12 Beginning
Balance from BBCNV Entries
GL Account
Dollar Amount
GL
Account
Dollar Amount
Difference
ASSETS
1010
$0.00
101000
$15,045,216,140.23
($15,045,216,140.23)
1011
$15,045,903,513.77
10100011
$0.00
$15,045,903,513.77
10P2
($15,193,407.06)
10100071
($14,506,033.52)
($687,373.54)
1340
$8,110,830.90
13400002
$93,808,531.02
($85,697,700.12)
1347
($84,740,219.85)
13470002
($84,741,112.07)
$892.22
134C
$1,158,770.29
13400001
$2,561,541.11
($1,402,770.82)
134G
$0.00
13400003
$4,174.82
($4,174.82)
134S
$87,104,645.76
13400001
$0.0
($87,104,645.76
13F1
$4,251,582.88
13100011
$4,739,397.24
($487,814.36)
13F2
$0.00
13100031
($383.99)
$383.99
13F3
$5,012,397.03
13100041
$4,564,468.30
$447,928.73
13F4
$26,005,263.63
13100051
$27,718,658.11
($1,713,394.48)
13F5
$143,196.54
13100031
$0.00
$143,196.54
13F6
$0.00
13100053
($1,434,466,124.86)
$1,434,466,124.86
13F9
$0.00
13190001
($197,648.44)
$197,648.44
13FA
$250.00
13100031
$0.00
$250.00
13G1
$0.00
13100013
$17,177.88
($17,177.88)
13P1
$1,492,042,533.75
13100012
$2,924,290,271.89
($1,432,247,738.14)
13P2
$21,776,221.64
13100032
$21,920,052.17
($143,830.53)
13P3
$551,173,249.47
13100042
$551,621,178.20
($447,928.73)
13P9
($1,722,301,531.94)
13190002
($1,722,103,883.50)
($197,648.44)
1411
$486,077.77
14100012
$490,270.78
($4,193.01)
1421
$3,117,232.66
14100011
$3,176,567.61
($59,334.95)
1432
$600,629.48
14100016
($14,201.51)
$614,830.99
1441
$1,237,700.97
14100018
$23,323,483.82
($22,085,782.85)
1445
$0.00
14100021
($13,651,046.82)
$13,651,046.82
1446
$154,027.25
14100023
($7,729,405.75)
$7,883,433.00
12-P-0559
12
-------
FY 11 00-17 Appended Journal
File Post Close Trial Balance
Compass FY 12 Beginning
Balance from BBCNV Entries
GL Account
Dollar Amount
GL
Account
Dollar Amount
Difference
LIABILITIES
2111
($61,756.25)
21100011
($3,508,526.86)
$3,446,770.61
2112
($69,505,037.17)
21100012
($66,058,266.56)
($3,446,770.61)
22F3
($25,495,147.36)
22130011
($25,495,027.49)
($119.87)
22P3
($4,008,456.78)
22130012
($4,008,576.65)
$119.87
2311
($840.00)
24000011
$5,094,159.74
($5,094,999.74)
2312
($69,791,395.31)
23100012
($308,158,066.54)
$238,366,671.23
2314
($292,270.30)
23100012
$0.00
($292,270.30)
2315
($38,980,203.20)
23100013
$0.00
($38,980,203.20)
2316
($34,978,779.73)
23100031
$60,622,056.15
($95,600,835.88)
2317
($653,999,156.25)
23100032
($749,599,992.13)
$95,600,835.88
2318
$0.00
23100021
$199,094,197.73
($199,094,197.73)
2326
$0.00
23200021
($1,163,379.49)
$1,163,379.49
2327
($136,069,973.29)
23200022
($134,906,593.80)
($1,163,379.49)
2400
$0.00
24000012
($14,289,234.53)
$14,289,234.53
240P
($914,581.57)
24000012
$0.00
($914,581.57)
24P0
($8,279,653.22)
24000012
$0.00
($8,279,653.22)
BUDGET
4222
$933,728,976.44
42220011
$1,798,389,553.91
($864,660,577.47)
42220012
($864,774,526.22)
$864,774,526.22
4921
($1,969,907.00)
49010012
($1,942,182.01)
($27,724.99)
49010011
($21,362.99)
$21,362.99
4923
($82,102,790.99)
49010013
($7,749,531.10)
($74,353,259.89)
49010014
($74,359,621.89)
$74,359,621.89
Source: OIG analysis based on 2011 ending balances in IFMS and 2012 beginning balances in Compass.
12-P-0559
13
-------
Appendix C
Differences Between FY 2011 Ending Balances and
FY 2012 Beginning Balances at the Treasury Symbol Level
IFMS
COMPASS
TRS SYM
GL
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
FUND BALANCE
WITH TREASURY
(41)681/20108
1011
($10,000.00)
($10,000.00)
6800/010108
1011
$16,067.44
$16,067.44
681/20108
1011
$3,173,744,710.71
6811/120108
#101000
$3,173,734,710.71
$10,000.00
683/40108
1011
$671,306.10
$671,306.10
6800/010108
10P2
($16,067.44)
($16,067.44)
683/40108
10P2
($671,306.10)
???
???
($671,306.10)
683229
1015
($4,597.32)
($4,597.32)
68322900
1015
$4,597.32
$4,597.32
FEDERAL RECEIVABLES
6800/010108
13F1
$0.00
#6800/010108
#13100011
$18,767.20
($18,767.20)
6801/020108
13F1
$0.00
#6801/020108
#13100011
$18,652.59
($18,652.59)
68-20X8145
13F1
$256,827.72
#68-68X8145
#13100011
$850,269.98
($593,442.26)
6880200
13F1
$0.00
#68880200
#13100011
($143,047.69)
$143,047.69
68-20X8145
13G1
$0.00
#68-68X8145
#13100013
$17,177.88
($17,177.88)
#68-68X8145
#13100031
($633.99)
$633.99
20X8145.4
13F3
$4,273,607.76
#20X8145.4
#13100041
$3,849,981.69
$423,626.07
681099
13F3
$0.00
#681099
#13100041
($24,302.66)
$24,302.66
680/10107
13F4
$243,303.54
#6810/110107
#13100051
$238,624.44
$4,679.10
680/10108
13F4
$3,720,500.54
#6810/110108
#13100051
$3,609,567.59
$110,932.95
6800/010108
13F4
$0.00
#6800/010108
#13100051
($18,776.96)
$18,776.96
6801/020108
13F4
$0.00
#6801/020108
#13100051
($18,501.82)
$18,501.82
681/20108
13F4
$1,418,532.86
#6811/120108
#13100051
$1,355,252.76
$63,280.10
682/30107
13F4
$0.00
#6802/030107
#13100051
($5,114.55)
$5,114.55
68-20X8145
13F4
$4,806,679.14
#68-68X8145
#13100051
$5,028,364.51
($221,685.37)
684/50108
13F4
$19,147.06
#6804/050108
#13100051
$58,276.98
($39,129.92)
685/60107
13F4
$5,461.45
#6805/060107
#13100051
($902.28)
$6,363.73
685/60108
13F4
$340,869.12
#6805/060108
#13100051
$954,639.29
($613,770.17)
686/70107
13F4
$216,567.76
#6806/070107
#13100051
$228,188.58
($11,620.82)
686/70108
13F4
$192,995.02
#6806/070108
#13100051
$190,310.50
$2,684.52
12-P-0559
14
-------
IFMS
COMPASS
TRS SYM
GL
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
688/90108
13F4
$196,075.82
#6808/090108
#13100051
$192,304.77
$3,771.05
68X8221
13F4
$12,964,440.01
#68X8221
#13100051
$14,025,732.99
($1,061,292.98)
68X4565
13F6
$12,810,001.08
#68X4565
#13100053
($1,421,656,123.78)
$1,434,466,124.86
20X8145.4
13F9
($0.00)
#20X8145.4
#13190001
$53,282.90
($53,282.90)
681099
13F9
($0.00)
#681099
#13190001
$5,238.64
($5,238.64)
683200
13F9
$0.00
#683200
#13190001
($257,989.05)
$257,989.05
683220
13F9
($0.00)
#683220
#13190001
$1,819.07
($1,819.07)
68110118
13F5
$143,196.54
$143,196.54
680/10108
13P1
$310,924.00
#6810/110108
#13100012
$421,856.95
($110,932.95)
681/20108
13P1
$3,056,680.25
#6811/120108
#13100012
$3,119,960.35
($63,280.10)
68-20X8145
13P1
$1,488,448,084.07
#68-68X8145
#13100012
$1,487,615,778.56
$832,305.51
#6800/010108
#13100012
$9.76
($9.76)
#6801/020108
#13100012
($150.77)
$150.77
#6802/030107
#13100012
$5,114.55
($5,114.55)
05
#6804/050108
#13100012
($39,129.92)
$39,129.92
LU
_1
#6805/060107
#13100012
$6,363.73
($6,363.73)
CO
<
#6805/060108
#13100012
($613,770.17)
$613,770.17
>
UJ
O
#6806/070107
#13100012
($11,620.82)
$11,620.82
#6806/070108
#13100012
$2,684.52
($2,684.52)
C£
#6808/090108
#13100012
$3,771.05
($3,771.05)
_J
<
C£
UJ
O
#6810/110107
#13100012
$4,679.10
($4,679.10)
#68880200
#13100012
$143,047.69
($143,047.69)
#68X4565
#13100012
$1,434,466,124.86
($1,434,466,124.86)
U_
#68X8221
#13100012
($1,061,292.98)
$1,061,292.98
z
O
68-20X8145
13P2
$7,315,384.15
#68-68X8145
#13100032
$7,316,018.14
($633.99)
z
#68110118
#13100032
$143,196.54
($143,196.54)
20X8145.4
13P3
$232,647,107.10
#20X8145.4
#13100042
$233,070,733.17
($423,626.07)
681099
13P3
$183,214,129.17
#681099
#13100042
$183,238,431.83
($24,302.66)
20X8145.4
13P9
($163,456,067.25)
#20X8145.4
#13190002
($163,509,350.15)
$53,282.90
681099
13P9
($149,175,789.70)
#681099
#13190002
($149,181,028.34)
$5,238.64
683200
13P9
($17,317,474.61)
#683200
#13190002
($17,059,485.56)
($257,989.05)
683220
13P9
($487,715.44)
#683220
#13190002
($489,534.51)
$1,819.07
12-P-0559 15
-------
IFMS
COMPASS
GL
TRS SYM
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
68-68X8145
1411
$281,662.62
68-68X8145
14100012
$283,341.06
($1,678.44)
683220
1411
$0.00
683220
14100012
$0.15
($0.15)
6804/050108
1411
$0.00
6804/050108
14100012
$633.82
($633.82)
68X4565
1411
$119,774.59
68X4565
14100012
$121,655.19
($1,880.60)
68-68X8145
1421
$70,455.49
68-68X8145
14100011
$129,790.44
($59,334.95)
68X0103
1432
$90,600.00
68X0103
14100016
$20,000.00
$70,600.00
68-68X8145
1432
$0.00
68-68X8145
14100016
($34,201.51)
$34,201.51
680/10107
1432
$96,433.28
14100016
$0.00
$96,433.28
681/20107
1432
$388,531.33
14100016
$0.00
$388,531.33
689/00107
1432
$20,800.04
14100016
$0.00
$20,800.04
681/20108
1432
$4,264.83
14100016
$0.00
$4,264.83
05
I—
68-20X8145
1441
$724,556.97
$724,556.97
684/50108
1441
$634.00
#6804/050108
#14100018
$11,446,674.21
($11,446,040.21)
LLJ
05
68X0103
1441
$20,000.00
#68X0103
#14100018
$90,600.00
($70,600.00)
05
<
68X4565
1441
$492,510.00
#68X4565
#14100018
$8,374,062.40
($7,881,552.40)
01
#6809/100107
#14100018
$20,800.04
($20,800.04)
LLJ
1
#6810/110107
#14100018
$96,433.28
($96,433.28)
I—
o
#6811/120107
#14100018
$388,531.33
($388,531.33)
#6811/120108
#14100018
$4,264.83
($4,264.83)
#683220
#14100018
($0.15)
$0.15
#68-68X8145
#14100018
$2,882,582.79
($2,882,582.79)
#68-68X8153
#14100018
$10,369.59
($10,369.59)
#68X8221
#14100018
$9,165.50
($9,165.50)
68-20X8145
1445
$5,505,748.56
$5,505,748.56
68-20X8153
1445
$65,491.25
$65,491.25
68X8221
1445
$11,819.19
#68X8221
#14100021
$2,653.69
$9,165.50
#6804/050108
#14100021
($11,446,674.03)
$11,446,674.03
#68-68X8145
#14100021
$3,320,910.86
($3,320,910.86)
#68-68X8153
#14100021
$55,121.66
($55,121.66)
68X4565
1446
$154,027.25
#68X4565
#14100023
($7,729,405.75)
$7,883,433.00
12-P-0559
16
-------
IFMS
COMPASS
TRS SYM
GL
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
68-20X8145
2312
($30,244,161.33)
#68-68X8145
#23100012
($250,743,163.77)
$220,499,002.44
680/10108
2312
($978,998.94)
#6810/110108
#23100012
($1,017,891.63)
$38,892.69
681/20108
2312
($17,082,237.52)
#6811/120108
#23100012
($17,083,326.51)
$1,088.99
684/50107
2312
($4,512.84)
#6804/050107
#23100012
$86,827.47
($91,340.31)
684/50108
2312
($531,141.61)
#6804/050108
#23100012
($722,168.38)
$191,026.77
685/60107
2312
($1,412.48)
#6805/060107
#23100012
($98,912.48)
$97,500.00
685/60108
2312
$271,578.61
#6805/060108
#23100012
$211,932.74
$59,645.87
686/70108
2312
($269,924.80)
#6806/070108
#23100012
$491,726.93
($761,651.73)
687/80107
2312
$338.86
#6807/080107
#23100012
($43,579.47)
$43,918.33
05
687/80108
2312
($184,856.09)
#6807/080108
#23100012
$2,289.73
($187,145.82)
<
C£
C£
688/90107
2312
($34,462.10)
#6808/090107
#23100012
$465,537.31
($499,999.41)
688/90108
2312
($4,525.25)
#6808/090108
#23100012
$519,815.00
($524,340.25)
LLJ
Ll
689/00107
2312
$535.95
#6809/100107
#23100012
$68,686.04
($68,150.09)
LLI
Q
689/00108
2312
($47,369.13)
#6809/100108
#23100012
$2,259,686.26
($2,307,055.39)
Q
68X0108
2312
$37,422.60
#68X0108
#23100012
$50,389.95
($12,967.35)
Z
<
68X4310
2312
($8,759,533.66)
#68X4310
#23100012
($28,942,198.68)
$20,182,665.02
05
UJ
O
68X5297
2312
($18,716.23)
#68X5297
#23100012
($82,761.75)
$64,045.52
68X5374
2312
($10,553,328.59)
#68X5374
#23100012
($15,694,176.54)
$5,140,847.95
z
<
#681099
#23100012
($291,729.60)
$291,729.60
>
Q
#683220
#23100012
($540.70)
$540.70
<
#68X4565
#23100012
$3,840,974.70
($3,840,974.70)
I—
D
#68X8221
#23100012
($49,392.40)
$49,392.40
o
n
68-20X8145
2314
$0.00
#68-68X8145
#23100012
($250,743,163.77)
$250,743,163.77
(0
<
o
#6804/050107
#23100012
$86,827.47
($86,827.47)
#6804/050108
#23100012
($722,168.38)
$722,168.38
#6805/060107
#23100012
($98,912.48)
$98,912.48
#6805/060108
#23100012
$211,932.74
($211,932.74)
#6806/070107
#23100012
($8,736.53)
$8,736.53
#6806/070108
#23100012
$491,726.93
($491,726.93)
#6807/080107
#23100012
($43,579.47)
$43,579.47
#6807/080108
#23100012
$2,289.73
($2,289.73)
#6808/090107
#23100012
$465,537.31
($465,537.31)
#6808/090108
#23100012
$519,815.00
($519,815.00)
#6809/100107
#23100012
$68,686.04
($68,686.04)
12-P-0559 17
-------
IFMS
COMPASS
GL
TRS SYM
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
#6809/100108
#23100012
$2,259,686.26
($2,259,686.26)
#6810/110107
#23100012
($294,536.70)
$294,536.70
#6810/110108
#23100012
($1,017,891.63)
$1,017,891.63
#6811/120107
#23100012
($1,042,172.42)
$1,042,172.42
#6811/120108
#23100012
($17,083,326.51)
$17,083,326.51
#68X0108
#23100012
$50,389.95
($50,389.95)
#68X4310
#23100012
($28,942,198.68)
$28,942,198.68
#68X4311
#23100012
($40,645.11)
$40,645.11
#68X4565
#23100012
$3,840,974.70
($3,840,974.70)
#68X5297
#23100012
($82,761.75)
$82,761.75
#68X5374
#23100012
($15,694,176.54)
$15,694,176.54
#68X8221
#23100012
($49,392.40)
$49,392.40
68-20X8145
2315
($290,446.22)
($290,446.22)
680/10107
2315
($2,432.05)
($2,432.05)
680/10108
2315
($8,853,064.08)
($8,853,064.08)
681/20108
2315
($6,916,784.01)
($6,916,784.01)
684/50108
2315
($3,018.35)
($3,018.35)
685/60108
2315
($57.00)
($57.00)
686/70108
2315
$13,429.59
$13,429.59
687/80108
2315
($20,584.03)
($20,584.03)
688/90107
2315
($1,025,058.50)
($1,025,058.50)
688/90108
2315
($156,753.44)
($156,753.44)
689/00107
2315
($503,054.08)
($503,054.08)
689/00108
2315
($1,435,669.36)
($1,435,669.36)
689/08195
2315
($19,636,961.89)
($19,636,961.89)
689/10108
2315
($3.09)
($3.09)
6890112
2315
($100,354.29)
($100,354.29)
68X8221
2315
($49,392.40)
($49,392.40)
68-20X8145
2316
($34,978,779.73)
#68-68X8145
#23100031
$60,622,056.15
($95,600,835.88)
68-20X8145
2317
($653,999,156.25)
68-68X8145
#23100032
($749,599,992.13)
$95,600,835.88
68X4565
2318
($32,389,558.32)
#68X4565
#23100021
($36,230,533.02)
$3,840,974.70
#6804/050107
#23100021
($91,340.31)
$91,340.31
#6804/050108
#23100021
$188,008.42
($188,008.42)
#6805/060107
#23100021
$97,500.00
($97,500.00)
12-P-0559
18
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IFMS
COMPASS
TRS SYM
GL
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
#6805/060108
#23100021
$59,588.87
($59,588.87)
#6806/070108
#23100021
($748,222.14)
$748,222.14
#6807/080107
#23100021
$43,918.33
($43,918.33)
#6807/080108
#23100021
($207,729.85)
$207,729.85
#6808/090107
#23100021
($1,525,057.91)
$1,525,057.91
#6808/090108
#23100021
($681,093.69)
$681,093.69
#6809/100107
#23100021
($571,204.17)
$571,204.17
#6809/100108
#23100021
($3,742,724.75)
$3,742,724.75
#6809/108195
#23100021
($19,636,961.89)
$19,636,961.89
#6809/110108
#23100021
($3.09)
$3.09
#68090112
#23100021
($100,354.29)
$100,354.29
#6810/110107
#23100021
($2,432.05)
$2,432.05
#6810/110108
#23100021
($8,814,171.39)
$8,814,171.39
#6811/120108
#23100021
($6,915,695.02)
$6,915,695.02
#68-68X8145
#23100021
$220,208,556.22
($220,208,556.22)
#68X0108
#23100021
($12,967.35)
$12,967.35
#68X4310
#23100021
$20,182,665.02
($20,182,665.02)
#68X5297
#23100021
$64,045.52
($64,045.52)
#68X5374
#23100021
$5,140,847.95
($5,140,847.95)
o
!j ^ CO
CQ CO LLl
< LLI p
2311
$0.00
#68F3875
#24000011
$5,032,399.65
($5,032,399.65)
2311
$0.00
#68X6275
#24000011
$62,600.09
($62,600.09)
24F0
#68F3875
#24000011
$5,032,399.65
($5,032,399.65)
24F0
#68X6275
#24000011
$62,600.09
($62,600.09)
< J ^
68F3875
240P
($1,178,057.47)
#24000012
$0.00
($1,178,057.47)
Ol ^ CQ
68F3880
240P
($1,018.25)
#24000012
$0.00
($1,018.25)
68X6275
240P
$256,221.26
#24000012
$0.00
$256,221.26
Z —1 C£
DQLU
68X6276
240P
$8,272.89
#24000012
$0.00
$8,272.89
OLUI
8 cc °
-------
IFMS
COMPASS
TRS SYM
GL
ACCT
AMOUNT
TRS SYM
GL ACCT
AMOUNT
DIFFERENCE
BUDGET
68-20X8145
4450
$133,908,093.60
#68-68X8145
#44500002
($47,866,115.18)
$181,774,208.78
68X5374
4450
($4,737,049.78)
No Activity
($4,737,049.78)
68X8221
4450
($2,436,712.12)
#68X8221
#44500002
($2,436,712.69)
$0.57
68X8741
4450
($75,608.95)
#68X8741
#44500002
$0.65
($75,609.60)
68-20X8145
4451
($2,167,441,125.83)
#68-68X8145
#44500001
($1,985,666,917.05)
($181,774,208.78)
68X8221
4451
($20,256,552.28)
#68X8221
#44500001
($20,256,551.71)
($0.57)
No Activity
#68X5374
#44500001
($4,737,049.78)
$4,737,049.78
No Activity
#68X8741
#44500001
($75,609.60)
$75,609.60
68-20X8145
4923
($32,552,143.75)
#68-68X8145
#48010013
$7,046,215.57
$372.89
68-20X8145
4923
($32,552,143.75)
#68-68X8145
#48010014
$25,506,301.07
$372.89
68X4310
4923
($463,167.74)
#68X4310
#48010013
$202,952.70
$2,751.97
68X4310
4923
($463,167.74)
#68X4310
#48010014
$262,967.01
$2,751.97
Source: OIG analysis based on 2011 ending balances in IFMS and 2012 beginning balances in Compass.
12-P-0559
20
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Appendix D
Abnormal Beginning Balances in Compass
Compass
A/C
Compass Account Description
Balance
133500
EXPENDITURE TRANSERS RECEIVABLE
($1,325,492.45)
13100031
BILLED REFUND FEDERAL
($383.99)
13100053
WCF ADVANCES TO BE APPLIED
($1,434,466,124.86)
14100016
GRANT ADVANCES
($14,201.51)
14100021
ADVANCE TO WCF
($13,651,046.82)
14100023
ADVANCES FOR POSTAGE, WCF
($7,729,405.75)
24000011
LIABILITY DEP/CI FDS CASH DIFFERENCE FEDERAL
$5,094,159.74
23100031
ADVANCES, HRSTS CASHOUTS, FEDERAL
$60,622,056.15
23100021
OTHER ADVANCES, FEDERAL
$199,094,197.73
298000
CUSTODIAL LIABILITY
$66,342,857.88
414900
BORROW AUTH CARRIED FORWARD
($256,122.00)
42210012
UNFILLED CUSTOMER ORDERS UNCOLLECTED, NONFEDERAL
($637,931,687.71)
42220012
UNFILLED CUSTOMER ORDERS COLLECTED, NONFEDERAL
($864,660,577.47)
48010021
UNDELIVERED ORDERS-OBLIG, UNPD FEDERAL
$125,416,478.38
48010011
UND ORDERS-OBLIG, REIMB UNPD FEDERAL
$28,849,767.02
48020011
UND ORD-OBLIG, REIMB PREPD/ ADVD FEDERAL
$4,217,485.31
49010021
DELIVERED ORDERS-OBLIG, UNPAID FEDERAL
$191,518,381.19
Source: OIG analysis of beginning balances provided by EPA.
12-P-0559
21
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Appendix E
Beginning Balance Adjustments Due to Migration,
Mapping Errors, and Budget Corrections
GL ACC7
BBCNV
BEGBALCORR
CARRYOVERBAL
CORRECT
2012-0
OB-2012
SUMMARY
10100011
($691,261.00)
$691,261.00
$0.00
13400001
$2,561,541.11
($1,402,770.82)
$1,158,770.29
13400002
$93,808,531.02
($6,703,885.26)
$87,104,645.76
13400003
$4,174.82
($4,174.82)
$0.00
13400004
$8,110,830.90
$8,110,830.90
13470002
($84,741,112.07)
$892.22
($84,740,219.85)
21100011
($3,508,526.86)
$3,446,770.61
($61,756.25)
21100012
($66,058,266.56)
($3,446,770.61)
($69,505,037.17)
22130011
($25,495,027.49)
($119.87)
($25,495,147.36)
22130012
($4,008,576.65)
$119.87
($4,008,456.78)
23200021
($1,163,379.49)
$1,163,379.49
$0.00
23200022
($134,906,593.80)
($1,163,379.49)
($136,069,973.29)
310000
($11,462,598,175.62)
$691,261.00
($18,283,860.99)
$18,216,740.74
($624,140.75)
($11,462,598,175.62)
331000
($7,681,691,194.36)
$18,283,860.99
($18,216,740.74)
($67,120.25)
($7,681,691,194.36)
420100
$11,698,735,441.88
($691,261.00)
$691,261.00
$11,698,735,441.88
44500001
($2,267,797,750.51)
$93,772,154.03
$67,014,267.62
$16,175,128.32
($2,090,836,200.54)
44500002
($1,033,864,255.30)
$624,140.18
($2,898,141,590.53)
$2,676,890,086.84
$43,665,813.54
($1,210,825,805.27)
TOTAL
($10,970,723,169.88)
($66,228.60)
($2,804,369,436.50)
$2,743,904,354.46
$60,532,202.86
($10,970,722,277.66)
Source: OIG analysis based on 2011 ending balances in IFMS and 2012 beginning balances in Compass.
12-P-0559
22
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Appendix F
General Ledger Crosswalk Errors
IFMS Description
IFMS
Compass
Default
Compass Name/Description
Int Receivable - Not Otherwise
1340
13400002
Interest Receivable Superfund Non-
Classified
Federal
Interest Rec Superfund Non-Fed
134S
13400001
Interest Receivable Federal Superfund
Other Geri Prop, Plant & Equip
1890
17500003
Federal Equipment at EPA
Accrued Funded Annual Leave
22FL
222500
Unfunded FECA Liability, Federal
Advance Collections Fed
2311
24000011
Liability Dep/CI Fds Cash Difference
Federal
Adv From Non-Fed AG O&M Act
2313
23100023
WCF Advances, Fed Non-EPA
Other Structures & Facilities
1740
173000
Buildings, Improvements, and
Renovations
Anticipated Transfers - Prior Year
4180
416000
Anticipated Transfers - Current-Year
Balance
Authority
Total Resources Adjustment
4211
421000
Anticipated Reimbursements and Other
Income
SF Spec Acct Rev Coll, Fed
427A
427300
Interest Collected From Treasury
Reduction in C/O - Contra Reim
445D
45900015
Allowances - Anticipated
Category B Apportionment
4513
45900015
Allowances - Anticipated
Funds Avail for Allot Reimb
4561
45900012
Suballocations - Anticipated
O/R Exp Auth, Reim No Budg Upd
465R
46100020
Allow Iss Non Bud Appr Ck Can
Tax Rev Coll Not Collected
5800
580400
Tax Revenue Collected - Excise
Postage Expense Federal Exc
62FE
671000
Depreciation, Amortization and
Depletion
Other Assets, Non Federal
199P
154100
Forfeitd Property Hold For Sale
Capitalization Exp, Non Ex
612N
61000012
Operating Expense Public Exc
Adjustment to Subsidy Expense
6199
61000032
Account Paid Pend Detail Nex
Future Funded Expense Fed N-E
68FN
68000022
Future Funded Expense Pub N-E
Source: OIG analysis of Agency-provided crosswalk.
12-P-0559
23
-------
Appendix G
Effect on Audit of Data Requests Not Received
Requested data not received
Date of
initial
request
Reason for the data
Potential effect if the OIG does not
receive the data
The details that support the
beginning and ending balances
(vendor, type, vendor number,
billing document, outstanding
billings, dates, amounts, etc.).
Beginning balance trans
code/type, all entries/in period
'00, balance by budget fiscal
year and treasury symbol. Any
adjustments to the beginning
balances and related support for
those adjustments.
12/8/2011
(arid
weekly
thereafter)
To determine the
appropriateness and
accuracy of those
adjustments.
Rely on the accuracy of the beginning
balances. We may not be able to render
a clean opinion on the financial
statements.
Journal File from Compass
12/8/2011
To review the beginning
balances, monthly post
close and year-end audit
data.
Perform audit sampling and audit the
financial statements. We may not be able
to render a clean opinion on the financial
statements.
Beginning balance details in
accounting period 00 from
Compass (exactly what migrated
from IFMS, what documents
make up the beginning balance,
etc.)
1/26/2012
To determine why the
2012 beginning balances
do not agree with the
2011 ending balances.
Review the transactional details of the
beginning balances to determine if they
beginning balances were adjusted and if
adjustments were supported and
reasonable. We may not be able to
render a clean opinion on the financial
statements.
Reconciliations of GL accounts
performed
2/8/2012
To Review
reconciliations to
determine if they are
timely prepared.
Determine if internal controls are
adequate. May not be able to rely on
internal controls over the financial
statements.
Compass migration strategy
questions
2/23/2012
To review the
reasonableness of the
migration strategy.
Determine if the ending balances
migrated properly to Compass. We may
not be able to rely on internal controls or
render a clean opinion on the financial
statements.
Source: OIG requests for data and data received as of March 23, 2012.
12-P-0559
24
-------
Appendix H
Distribution
Office of the Administrator
Agency Follow-Up Official (the CFO)
Deputy Chief Financial Officer
Agency Follow-Up Coordinator
General Counsel
Associate Administrator for Congressional and Intergovernmental Relations
Associate Administrator for External Affairs and Environmental Education
Director, Office of Budget, Office of the Chief Financial Officer
Director, Office of Financial Management, Office of the Chief Financial Officer
Director, Office of Financial Services, Office of the Chief Financial Officer
Director, Research Triangle Park Finance Center, Office of the Chief Financial Officer
Director, Cincinnati Finance Center, Office of the Chief Financial Officer
Director, Las Vegas Finance Center, Office of the Chief Financial Officer
Director, Office of Planning, Analysis, and Accountability, Office of the Chief Financial Officer
Director, Reporting and Analysis Staff, Office of the Chief Financial Officer
Director, Office of Technology Solutions, Office of the Chief Financial Officer
Director, Financial Policy and Planning Staff, Office of the Chief Financial Officer
Director, Accountability and Control Staff, Office of the Chief Financial Officer
Director, Payroll Management and Outreach Staff, Office of the Chief Financial Officer
Audit Follow-Up Coordinator, Office of the Chief Financial Officer
Audit Follow-Up Coordinator, Office of Financial Management, Office of the
Chief Financial Officer
Audit Follow-Up Coordinator, Office of Financial Services, Office of the Chief Financial Officer
12-P-0559
25
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