The Government Accountability Office has issued a report containing dozens of recommendations for ways the Internal Revenue Service should improve its internal controls.
Among the problems identified by the GAO were that summary information reported in the IRS's general ledger system for tax-related transactions could not be traced to the underlying detailed transaction records. The GAO also found that supervisory review procedures for the IRS's unpaid assessments estimation process were not effective in preventing or detecting errors.
Controls over computer programs affecting penalty assessments did not ensure that the programs always functioned in accordance with the IRS's policies and procedures. Key controls over the IRS's purchase card program were inadequate, and information on new assets was not always recorded in the IRS's property and equipment inventory system within required time frames.
The GAO recommended that the IRS document and implement the specific procedures to be performed by the statistician in each step of the unpaid assessments estimation process. It said the IRS should require that a detailed supervisory review be performed to ensure the statistical validity of the sampling plans, and that data entered into the sample selection programs agree with the sampling plans, among other recommendations.
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