Audit Reports

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September 26, 2017

OSDBU Lacks Effective Processes for Establishing, Overseeing, and Managing Its Small Business Transportation Resource Centers

Self-Initiated
Project ID: 
ZA2017106
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The mission of the Department of Transportation’s (DOT) Office of Small and Disadvantaged Business Utilization (OSDBU) is to provide opportunities, technical assistance, and financial services to the small business community. OSDBU maintains 13 Centers nationwide that serve as stewards for OSDBU’s Bonding Education Program and the Women and Girls in Transportation Initiative. In addition, the Centers provide assistance to applicants seeking to participate in OSDBU’s Short Term Lending Program and offer free business coaching, technical workshops, and information on procurement opportunities. Given the important role the Centers play in helping the Department meet its mission, we initiated this audit to assess OSDBU’s oversight of its Centers. Accordingly, our audit objectives were to assess OSDBU’s (1) processes for establishing the Centers and (2) oversight of the Centers’ compliance with cooperative agreements and achievement of program objectives.
 
Overall, we found that OSDBU lacks a defined framework for establishing, renewing, and managing its Centers. In addition, OSDBU lacks effective processes for overseeing and managing Center performance and financial resources; we found $69,312 in questioned costs and $1,168,907 in funds put to better use. OSDBU concurred with our 10 recommendations to improve OSDBU’s management and oversight of its Centers.

Recommendations

Open

Closed

Closed on 09.24.2018
No. 1 to OST

Develop and implement written policies and procedures for establishing new Centers or making adjustments to existing ones—including determining each Center's initial financial resource needs, changes to funding levels, locations, geographic areas of coverage, and small business/client populations.

Closed on 06.01.2018
No. 2 to OST

Conduct a baseline program needs assessment of current funding levels, locations, geographic areas of coverage, and small business/client populations to be served—and take corrective actions as needed to meet determined needs.

Closed on 06.01.2018
No. 3 to OST

Develop and implement an action plan for increasing future competition for Center operation.

Closed on 02.08.2019
No. 4 to OST

Develop and implement performance measures for cooperative agreement requirements that assess how well the Centers achieve program objectives and desired outcomes

Closed on 09.24.2018
No. 5 to OST

Implement policies and procedures to ensure OSDBU personnel comply with existing monitoring requirements for conducting annual performance evaluations and site visits

$69,312
No. 6 to OST

Recover the $69,312.00 in improper payments for unallowable labor charges

Closed on 09.24.2018
$1,168,907
No. 7 to OST

Implement policies and procedures to ensure that OSDBU's financial management practices comply with appropriation law, Federal regulations, and the Department's Financial Assistance Guidance Manual. Implementing this recommendation could potentially put $1,168,907 in funds to better use.

Closed on 06.01.2018
No. 8 to OST

Take action to correct the $346,927 in improper payments related to OSDBU's financial management practices identified in this report.

Closed on 09.24.2018
No. 9 to OST

Deobligate the $57,758 remaining on cooperative agreements that have ended, as identified by this audit as funds that could have been put to better use

Closed on 12.19.2019
No. 10 to OST

Develop and implement a process to perform periodic financial assistance management reviews of OSDBU to ensure that OSDBU is informed about and complies with existing financial management assistance laws, regulations, and guidance.