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Circular No. A-50

September 29, 1982


SUBJECT:   Audit Followup

1. Purpose. This circular provides the policies and procedures for use by executive agencies when considering reports issued by the Inspectors General (IGs), other executive branch audit organizations, the General Accounting Office (GAO), and non-Federal auditors where followup is necessary.

2. Rescissions. This revision replaces and rescinds Circular No. A-50, "Executive branch action on General Accounting Office reports," Revised, dated January 15, 1979, and incorporates certain provisions previously set forth in Circular A-73, "Audit of Federal operations and programs," Revised, dated November 27, 1979.

3. Authority.

4. Background. The principal objectives of this revision are:

5. Policy. Audit followup is an integral part of good management, and is a shared responsibility of agency management officials and auditors. Corrective action taken by management on resolved findings and recommendations is essential to improving the effectiveness and efficiency of Government operations. Each agency shall establish systems to assure the prompt and proper resolution and implementation of audit recommendations. These systems shall provide for a complete record of action taken on both monetary and non-monetary findings and recommendations.

6. Definitions.

7. Responsibilities.

8. Action Requirements.

9. Applicability to Regulatory Audits. The requirements for resolution and corrective action contained paragraph 8.a. shall be applied to those reports of agency units responsible for regulatory or inspection activities involving the review of financial matters that may result in:

The agency audit followup official shall ensure that appropriate followup systems are in place for these units. Separate subsystems may be used.

10. Applicability to Preaward Contract Audits. Audit reports involving recommendations on contractor estimates of future costs are subject to the provisions of this Circular. However, since such reports generally are resolved by negotiation of a contract price, they are not subject to the time limits or reporting requirements set forth in paragraphs 8.a.(2), (5), and (8). The requirement for records on the status of reports set forth in paragraph 8.a.(4) may be met by records maintained in official contract files.

11. Accounting and Collection Controls. In order to ensure effective recovery action, each agency will establish accounting and collection controls for amounts due the Government as a result of resolved audit findings and recommendations. Unless otherwise required by statute, all claims arising from audit disallowances shall be collected in accordance with Federal Claims Collection Standards.

12. OMB Responsibility. OMB will continue to work with agency audit followup officials and Inspectors General to ensure that the provisions of this Circular are implemented.

13. Information Contact. Inquiries should be directed to the OMB Financial Management Division at 395-3993 or to the OMB Debt Collection Staff at 395-3967.

14. Sunset Review Date. This Circular shall have an independent policy review to ascertain its effectiveness three years from the date of issue.

David A. Stockman

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