Statement of James J. Cornell, Inspector General Office of the Inspector General U.S. House of Representatives Before the House Subcommittee on Legislative Branch Appropriations Chairwoman Wasserman Schultz, Ranking Member Latham and Members of the Subcommittee, I am both pleased and honored to appear before you today in my capacity as the Inspector General of the House. Our office plays a vital role in helping to ensure integrity and identify opportunities for improvement in our House financial and administrative processes. As we enter this second session of the 110th Congress, we have over 19 reviews in progress that have been carefully scoped with the assistance of the Committee on House Administration (CHA) to further address the security and integrity of House information systems, the accuracy and reliability of the House financial information or the efficiency and effectiveness of House administrative processes and functions. In all of our reviews, we work closely with the House Officer or Official responsible for management of the area under review to ensure our recommendations are on target and add value. We have also developed the skill-sets and flexibility necessary to quickly respond to any urgent audit, process improvement or investigative need that our House customers may face. Highlights during the First Session of the 110th Congress During the first session of the 110th Congress, we issued 16 reports with 46 recommendations and 18 opportunities for improvement; all of which received House Officers’ concurrence. Twenty recommendations were closed and 8 of the opportunities for improvement were implemented during 2007. Below are highlights of the reviews that were completed in 2007. In the financial area, we continue to supervise the annual financial statement audit of the House. For the ninth year, the House received an unqualified opinion on its financial statements and compliance with laws and regulations. An “unqualified opinion� means that the financial statements fairly present, in all material respects, the financial position of the House and the results of its operations and cash flows in conformity with generally accepted accounting principles. The House continues to have two reportable conditions: (1) Weaknesses in the financial information system reduced the integrity of financial data and reporting; and (2) Procedures used to ensure the completeness and accuracy of estimates, accruals, and other adjustments included in year-end financial statements were inadequate. In other financial and compliance audit work, we completed fieldwork on a review of duplicate payment identification processes and are working with the Chief Administrative Officer (CAO) to develop solutions that will enhance their prevention and detection methodologies.
In the information technology area, we completed a review of general controls over Committee Web Pages and Servers and we reviewed Emergency Preparedness & Business Continuity Planning for Information Technology. In both of these reviews we identified areas of risk and corresponding corrective actions. We then worked with the House as they developed and implemented appropriate action plans. The OIG also issued approximately 30 White Papers to various Committees detailing the vulnerabilities we identified on their web servers. In addition, we provided assistance on how to best mitigate the vulnerabilities to the Committees that requested assistance. In the administrative area, during this past year we focused on life safety and security issues and the efficiency of administrative processes and procedures. Our reviews in this area included a review of evacuation procedures. Specifically, the review focused on the development and implementation of the individual Member office evacuation plans. We offered our assistance to all Member offices; met with representatives of 431 offices, analyzed their current plans and identified any of their concerns. Our life safety work also included a review of the progress the Architect of the Capitol has made to improve the fire protection systems in the Library of Congress since 2002. During the past year, we issued reports on the operations of the Clerk and the Sergeant of Arms offices. Both of these reviews were designed to provide a high-level assessment of operational risks and were planned and executed to provide our customers with the continued audit support needed to ensure the effective and efficient continuity of House operations. Finally, during the first session of Congress, we restructured our OIG to allow us to provide expanded advisory services while maintaining auditor independence. Our advisory work has contributed greatly to increased efficiency in the financial and administrative operations of the House. Through the application of Lean Management and Six-Sigma – two process improvement methodologies – we have provided in-depth analyses targeted at identifying waste and eliminating variation in business processes. Our advisory reviews are almost exclusively House Officer requested and are pursued with the approval and support of the CHA. Examples of our work in this area during 2007 include a management advisory review of the Payroll Counselor’s Spreadsheet to determine the number of payroll errors reported monthly and to determine if there are better, more efficient ways to perform balancing and error checking duties. This review led the CAO to launch a study of the payroll and benefits paperwork flow to address the inefficiencies we identified. We also did a management advisory review of the Paylinks Year-end Transition activities to identify payroll and benefits risks that may have prevented the CAO from meeting its year-end and Congressional transitional objectives. We made specific recommendations that will assist the Paylinks Transition Team in meeting its year-end and transition goals in subsequent years. In our more traditional advisory work, we evaluated the implementation of Phase III of the Capitol Heights Digital Mail Program and identified opportunities for the CAO to achieve improved project results in the areas of cost, performance, and timeliness. We also made specific recommendations to the CAO to address the system development and security risks identified. Throughout the 110th Congress, we are also performing a Systems Development Life
Cycle (SDLC) advisory review of the new PeopleSoft integrated financial management system (Atlas) being implemented by the House. Our review is evaluating the CAO-led team’s employment of industry best practices at each phase of the planning and implementation process. We have provided several recommendations to date that reduce the risk of a flawed system implementation. Once fully implemented, Atlas will provide users with a single financial system to simplify budgeting, requesting, tracking, and managing expenditures for all goods and services and provide desktop access to accurate, comprehensive and timely financial information. Focus for the 111th Congress During the first session of the 111th Congress, the OIG will finalize the work currently in progress and initiate new projects in accordance with our approved audit plan. In coordination with the CHA, House Officers, and joint entities, we will continue to focus on improving Member support services, life safety and security issues, and assuring the accuracy and integrity of the House financial and administrative systems. We will look at a wide range of technology issues including the efficient and effective development and implementation of new information systems, the security and integrity of House information systems and networks, and potential applications of emerging technologies to the House. We will continue to place emphasis on ensuring that the House and joint entities have sound internal controls to promote efficiency and effectiveness of operations; reduce risks of asset loss; and ensure compliance with House policies, laws, and regulations. The primary objective of all our efforts is to assist the CHA and House Officers in their efforts to continuously improve the administrative and financial functions of the House. FY 2009 Budget Request The OIG’s FY 2009 budget request calls for total funding of $4.945 million--a total increase of $588,000 over our FY 2008 appropriation. This total budget request is comprised of $2.947 million in mandatory items, including overall price level changes of $32,000 due to inflation, as well as $1.998 million needed to sustain non-personnel program services. Most of the requested increase is due to increased contractual support costs. Our recent reorganization will allow us to offer an expanded array of high value support services to our customers at a cost to the House that is far below market rates. The request reflects the offset of mandatory personnel compensation increases, which are not under the control of the OIG. The following is a detailed explanation of our personnel budget request. Relative to personnel compensation, I am requesting $2.947 million in FY 2009. This request represents an increase of $156,000 over the FY 2008 enacted level. These personnel compensation increases are requested to fund mandatory benefit levels and increases associated with the current staff for (i) annualized FY 2008 cost of living adjustment, (ii) anticipated FY
2009 cost of living adjustment, (iii) anticipated FY 2009 longevity and career ladder promotions, and (iv) anticipated FY 2009 merit increases. In addition, I am requesting $1.998 million in FY 2009 for non-personnel programs. This request represents an increase of $400,000 in program changes over the FY 2008 enacted level. Of this requested $1.998 million, $1.779 million is to perform our primary mission through our audit program. This program includes contracts for the annual independent audit of the House Financial Statements, continued oversight of the House Greening Initiative, security and other specialized information systems expertise, and LEAN/Six-Sigma consultant support. Additionally, audit–specific training, supplies, and travel are funded in this program. The remaining $187,000 funds the OIG’s administration and general training programs. Madam Chairwoman, I wish to thank you, Congressman Latham and the Members of the Subcommittee for this opportunity to present my FY 2009 budget. We look forward to continuing our role of providing value-added advice and counsel to the CHA, House Officers, and joint entities of the House, as we focus on issues of strategic importance to the House and its ability to efficiently and effectively conduct its operations in accordance with best business practices. At this time, I would be happy to answer any questions you may have.
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