BUREAU OF LAND MANAGEMENT ACCOUNTING SYSTEM (FROM CASES IN ACCOUNTABILITY, P 155-161, 1979, BY ERASMUS H KLOMAN - SEE NCJ-69444)

• NCJ Number: 69451
• Author(s): T C PERRY
• Date Published: 1979
• Length: 7 pages
• Sale Source: Westview Press, Inc
• Language: English
• Country: United States of America

Annotation

THE BUREAU OF LAND MANAGEMENT'S (BLM) ACCOUNTING PRINCIPLES AND STANDARDS, SYSTEM DESIGN, AND SYSTEM IN OPERATION WERE AMONG THE FIRST TO BE APPROVED BY THE GENERAL ACCOUNTING OFFICE (GAO) IN 1975.

Abstract

THE FINANCIAL MANAGEMENT GROUP OF THE GAO EXAMINED BLM'S ACCOUNTING MANUALS CONTAINING BLM'S PRINCIPLES AND STANDARDS TO DETERMINE ITS CONFORMITY TO GAO SPECIFICATIONS IN 1968; THE MANUAL, AFTER REVISIONS TO CLARIFY ITS STATEMENTS, WAS APPROVED IN 1969. IN 1970, AFTER EXAMINING THE ACCOUNTING MANUALS DEPICTING BLM'S ACCOUNTING SYSTEM DESIGN, ACCOUNTANTS STATED THAT BLM'S ACCOUNTING PRINCIPLES AND STANDARDS DID NOT APPEAR TO BE INCORPORATED IN THE ACCOUNTING MANUALS. MOST CRITICAL WERE RECORDING DEPRECIATION AND ACCOUNTING FOR RECEIPTS ON A DEFERRED BASIS. FURTHER EXAMINATION OF BLM'S ACCOUNTING MANUALS INDICATED THE ABSENCE OF ADEQUATE DOCUMENTATION OF DATA PROCESSING FUNCTIONS (ADP). BLM WAS INFORMED THAT ADP DOCUMENTATION COULD BE SUBMITTED TO THE GAO AS A SUPPLEMENT TO THE SYSTEM DESIGN DOCUMENTATION. THE GENERAL DESIGN WAS APPROVED IN 1969. IN 1974 AN AUDIT WAS PERFOMED OF THE AUDITING SYSTEM IN OPERATION. THE GAO AUDIT GROUP, CONCLUDING THAT THE BASIC ELEMENTS MANIFEST IN THE BUREAU'S ACCOUNTING SYSTEM WERE OPERATING IN ACCORDANCE WITH THE APPROVED SYSTEMS DESIGN, GAVE FINAL APPROVAL IN 1975. YET BLM, IN SUBMITTING A REPORT ON THE PROGRESS OF IMPLEMENTING THE FEW GAO RECOMMENDATIONS THAT WERE MADE IN THE FINAL APPROVAL, REJECTED PERIODIC DETERMINATION OF RATES USED TO RECOVER OVERHEAD COSTS FOR REIMBURSABLE SERVICES BECAUSE OF THE LACK OF ESTABLISHED GUIDELINES FOR THE CLASSIFICATION OF INDIRECT COSTS. MOREOVER, BLM REJECTED DEALING WITH ACCOUNTING FOR DEPRECIATION, MAINTAINING THAT IT SERVED NO MANAGEMENT PURPOSE AND WAS PERFORMED SOLELY TO COMPLY WITH GAO REQUIREMENTS. GAO FELT THAT TO REBUT THESE REJECTIONS WOULD REQUIRE UNNECESSARILY LARGE RESOURCES AND CONSIDERED THE APPROVAL STATUS CLOSED. THREE STUDY QUESTIONS AND FIFTEEN NOTES ARE PROVIDED.