Risk Assessment of Fiscal Year 2016 HUD Charge Card Programs

Date Issued: 
Monday, February 5, 2018
Publication/Report Type: 
Memorandums
Memorandum Number: 
2018-KC-0801
Program Area(s): 
Chief Procurement Officer, Chief Financial Officer
State: 
District of Columbia
Summary: 

The U.S. Department of Housing and Urban Development, Office of Inspector General (HUD OIG), has completed its annual risk assessment of HUD’s charge cards as required by the Government Charge Card Abuse Prevention Act of 2012, Public Law 112-194, and Office of Management and Budget (OMB) Memorandum M-13-21.  Our objective was to analyze the risks of illegal, improper, or erroneous purchases in HUD’s fiscal year 2016 travel and purchase card programs.  We found that a moderate risk remained in HUD’s travel card program and a low risk was associated with HUD’s purchase card program.

HUD’s travel card program had a moderate risk of susceptibility to illegal, improper, or erroneous purchases.  Risk-increasing factors included a continuation of identified potentially unauthorized travel transactions from the prior year’s OIG audit, unclear program guidance, and an increase in travel card use from fiscal year 2015.  Risk-decreasing factors included HUD’s timeliness in closing open travel card recommendations.

HUD’s purchase card program had a low risk of susceptibility to illegal, improper, or erroneous purchases.  Risk-increasing factors included noted difficulties with ARC’s ability to properly block certain restricted merchant category codes.  Risk-decreasing factors included fewer identified transactions with control issues from the prior year’s OIG audit, HUD’s timeliness in closing open purchase card recommendations, and a decrease in purchase card use from fiscal year 2015. 

This memorandum does not contain recommendations.  We will use the risk assessment to determine the scope, frequency, and number of periodic audits or reviews of charge card programs.

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