The Government Accountability Office (GAO) recently released a study of the FCC’s e-rate program controls. The GAO study recommended that the FCC conduct a "robust risk assessment" of its e-rate program and revise the internal control structure of the program. What caught our eye, however, was the commentary on USAC’s e-rate beneficiary audits.
The GAO criticized USAC’s beneficiary audits as lacking documented and approved policies and procedures. As a result, "[USAC] management may not have the assurance that control activities are appropriate and properly applied." It specifically criticized USAC for not using information gathered from the audits to assess and modify the e-rate program’s internal controls. As an example, the GAO noted that of 64 beneficiaries that were audited multiple times over a three year period, 56 percent of the beneficiaries (36 of 64) had the same audit finding in multiple years.
The full GAO report is available here.