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US Department of Education Principal Office Functional Statements
Office of the Chief Financial Officer

Functional Statements > Office of the Chief Financial Officer

FINANCIAL IMPROVEMENT OPERATIONS

Financial Improvement Operations (FIO) provides leadership and direction in the areas of internal control assessment, financial management training, post audit activities and indirect cost determination.

In carrying out its responsibilities, FIO:

  • Develops and implements Departmental policies related to audit follow-up
  • Oversees the Department's audit resolution operations.
  • Resolves discretionary grant audits and various formula grant audits for the Department.
  • Negotiates indirect cost rates on behalf of the Federal Government for all State Education Agencies and other entities in which the Department holds a predominate financial interest.
  • Develops and implements indirect cost policy.
  • Coordinates non-FSA improper payment risk assessment.
  • Designs and implements internal audit initiatives to reduce risks in the Department’s lines of business
  • Develops and directs the Department's implementation of the requirements for the Federal Managers' Financial Integrity Act of 1982 and OMB Circular A-123, Internal Control Systems

FIO's Director reports to the CFO. The Director provides overall leadership and coordination to the immediate office staff of FIO and to the following components:

Post Audit Group

The Post Audit Group (PAG) is responsible for policy development, implementation and oversight for the Department's response to the Inspector General Act of 1988 (P.L. 100-504) and OMB Circulars A-50, Audit Follow-up; and A-133, Audits of States, Local Governments, and Non-Profit Organizations. The office also resolves A-133 discretionary grant audit findings and various formula grant audit findings. PAG leads the Department's triage activities.
In carrying out its responsibilities, PAG:

  • Prepares and publishes the Department's Semiannual Report to Congress on Audit Follow-up.
  • Develops and issues Departmental external audit status reports.
  • Oversees revisions to the Handbook for the Post Audit Process and the Users’ Manual for the Audit Accountability and Resolution Tracking System (AARTS).
  • Resolves discretionary grant audit findings and prepares Program Determination Letters (PDLs) and Audit Clearance Documents (ACDs).
  • Processes single audits of state and local governments and non-profit organizations.
  • Analyzes, reports, and forecasts non-recoverable funds related to audit resolution due to statute of limitations.
  • Manages the enhancement and maintenance of the agency’s Audit Accountability and Resolution Tracking System (AARTS).
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Indirect Costs Group

The Indirect Cost Group (ICG) is responsible for developing, implementing and managing the Department’s indirect cost policy in accordance with OMB Circulars A-87, Costs Principles for State, Local, and Indian Tribal Governments, and A-122, Cost Principles for Non-Profit Organizations.
In carrying out its responsibilities, the Group:

  • Negotiates and establishes indirect cost rates on behalf of the Federal Government for all State Education Agencies; and negotiates and establishes indirect cost rates for other State agencies where the Department holds a predominant financial interest.
  • Negotiates and establishes indirect cost rates on behalf of the Federal Government for Institutions of Higher Education, nonprofits, and commercial firms where the Department holds a predominant financial interest.
  • Negotiates and settles liabilities resulting from excessive indirect cost reimbursement, resolves audits on indirect cost issues, and administers any related appeals.
  • Provides technical advice to external and internal customers on cost allocation issues under grants and contracts.
  • Serves as the Department's liaison with OMB on fulfilling the cognizant agency responsibilities for cost policy and oversight.
  • Oversees the program where States may receive delegations of authority to administer indirect cost oversight for their Local Education Agencies.
  • Develops and implements indirect cost policy.

Internal Control and Operations Group

The Department of Education (like all federal agencies) is required to have procedures and controls in place to ensure that the agency’s mission is accomplished and to minimize fraud, waste and abuse.

The Internal Control and Operations Group (ICOG) is responsible for assuring that the Department assesses and addresses risks inherent in its operations that would prevent it from accomplishing its mission in an effective and efficient manner. ICOG’s main functions are to lead internal control reviews, assess operational risks, monitor financial reporting procedures, conduct performance analyses, and lead internal controls and financial management trainings. To carry out its responsibilities, ICOG:

  • Assesses the procedures and systems used by ED’s Principal Offices
  • Reports on the Department’s compliance with the Federal Managers’ Financial Integrity Act of 1982 and OMB Circular A-123, Internal Control Systems
  • Reviews and identifies programs and activities that may be susceptible to violations of the Improper Payments Information Act of 2002
  • Develops and maintains audit resolution dashboards for Department management
  • Monitors the progress of remediating deficiencies identified by the Office of the Inspector General (OIG) and the Government Accountability Office (GAO)
  • Conducts Department-wide financial management and internal controls training

For more information about ICOG and/or to talk to a staff member, please contact the director, April Bolton-Smith, at (202) 245-6345.

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Last Modified: 08/07/2017