PERFORMANCE AND ACCOUNTABILITY REPORT: Fiscal Year 2004

APPENDIX 3
OIG AUDIT FOLLOW-UP

DETAIL OF FINAL ACTION ACTIVITY

Disallowed / Questioned Costs
Report #0ö29, Minority Business Enterprise Legal Defense and Education Fund (MBELDEF)
Summary: The audit objectives were to determine whether the payments made to MBELDEF for services related to the cosponsorship were justified, to determine MBELDEFās compliance with the terms of the cosponsorship agreement and determine whether MBELDEF properly accounted for the fee income it collected. The audit recommended that Government Contracting and Minority Enterprise Development require MBELDEF to reimburse SBA $121,394.0 for unsupported expenses, duplicate payments, unrelated expenses and for claimed expenses not incurred.

Final Action: $24,000.0 collected/$97,394.0 written off

Report #3ö31, Early Defaulted Loan To A&S Business, Inc.
Summary: The audit objective was to determine if the lender and borrower materially complied with SBAās requirements when originating, closing and liquidating the loan. The audit recommended SBA seek recovery of $225,324.0 from a lender, less any subsequent recoveries for the loan. The district office negotiated a 50% repair of the guaranty in return for the lender releasing SBA from liability of $153,000.0 for a related loan.

Final Action: $107,937.0 collected / $117.387.0 written off

Report #3ö35, National Womenās Business Council
Summary: The audit objective was to determine if whether the National Womenās Business Council (NWBC) expenditures and activities were appropriate and complied with laws and regulations. The audit recommended the current Executive Director determine whether SBA should seek recovery for the awards made to the Executive Director and NWBC staff that were improperly approved. If the determination was that SBA should seek recovery, ensure the Chief Financial Officer recover the funds.

Final Action: $0.0 collected / $0.0 written off

Report #4ö01, Early Defaulted Loan To Mandarin Country Day Preschool of North Florida, Inc.
Summary: The audit objective was to determine if the lender and borrower materially complied with SBAās requirements when originating, closing and liquidating the loan. The audit recommended the Office of Financial Assistance annotate SBAās loan accounting system to reflect the lenderās release of the loan guaranty of $692,250.0.

Final Action: $692,250.0 collected

Report #4ö04, SBA Guaranteed Loan To Concord Wire Company
Summary: The audit objective was to determine if the early loan default was caused by lender or borrower noncompliance with SBA requirements. The audit recommended SBA seek a repair of $78,750.0 from the lender for an improper payment made by the borrower to a standby creditor for the loan.

Final Action: $78,750.0 collected

Report #4ö06, SBA Guaranteed Loan To Himalayan Enterprises, Inc., dba Conoco Food Mart
Summary: The objective of this audit was to determine if the lender originated, disbursed and liquidated the loan in accordance with SBA rules and regulations. The audit recommended the SBA seek recovery of $519,754.87, less any subsequent recoveries, from the lender on the guaranty paid for the loan.

Final Action: $519,754.87 collected

Funds Put To Better Use
Report #2ö21, SBA Guaranteed Loan To Giordanoās Of Logan Square
Summary: The objective of this audit was to determine if the lender originated, disbursed and liquidated the loan purchased by SBA in accordance with SBA rules and regulations. The audit recommended SBA seek recovery of $93,688.82 from General Electric Capital Corporation on the guaranty paid, less any subsequent recoveries, for the loan.

Final Action: $93,688.82 implemented

Report #2ö30, SBA Guaranteed Loan To Earth Treasures, Inc.
Summary: The objective of this audit was to determine if the lender originated, disbursed and liquidated the loan purchased by SBA in accordance with SBA rules and regulations. The audit recommended SBA seek recovery of $84,911.0 from General Electric Capital Corporation on the guaranty paid, less any subsequent recoveries, for the loan.

Final Action: $5,000.0 implemented / $79,911.0 not implemented

Report #2ö32, SBA Guaranteed Loan To R.L.B. Vending, Inc. dba Break Time Vending
Summary: The objective of this audit was to determine if the lender originated, disbursed and liquidated the loan purchased by SBA in accordance with SBA rules and regulations. The audit recommended SBA see recovery of $370,309.0 from the General Electric Capital Corporation on the guaranty paid, less any subsequent recoveries, for the loan.

Final Action: $370,309.0 implemented

Report #3ö40, Early Defaulted Loan To Stickney & Poor Spice Company
Summary: The audit objective was to determine if the early loan default was caused by lender or borrower noncompliance with SBAās requirements. The audit recommended SBA seek recovery of the SBA repair guaranty of $316,165.0 for the loan.

Final Action: $335,640.21 implemented

TABLE III

Final Action On Audit Recommendations Not Completed Within 1 Year October 1, 2003 ö September 30, 2004

Long-Term Objective 2.2. Maximize the sustainability and growth of existing small business assisted by SBA.

Report #43H006021, 8(a) Continuing Eligibility Reviews
Program: 8(a)
Date Issued: 09/30/94
Management Decision Date: 10/30/94
Explanation: The recommendation is to the Associate Deputy Administrator for Government Contracting and Minority Enterprise Development to establish procedures for determining whether 8(a) participants should no longer be considered economically disadvantaged based on their ownership interest in their 8(a) firms. Proposed success and graduation criteria have been proposed and are in clearance. These criteria will be implemented in FY2005. In addition, new criteria defining excessive withdrawals of company revenue by the owner will be proposed during FY2005. The target date for final action has passed, a new target date has not yet been determined.

Report #87H002017, NOAA Computer Workstation Contracts
Program: 8(a)
Date Issued: 06/18/98
Management Decision Date: 03/1/99
Explanation: The recommendation is to the Associate Deputy Administrator for Government Contracting and Minority Enterprise Development to provide definitive guidance and definitions to evaluate the manufacturing criteria in 13 CFR 121.206. A final rule regarding ćInformation Technology Value Addedä became effective on January 28, 2004. Additionally, a final rule redefining the definition of ćmanufacturingä became effective on June 21, 2004. This change was part of a general rulemaking effect on technical and procedural changes to 13 CFR Part 121. The target date for final action has passed, a new target date has not yet been determined.

Report #9ö23, Survey of Electronic Records Management
Program:M&A
Date Issued:09/15/99
Management Decision Date:11/30/99
Explanation:This recommendation is to the Associate Deputy Administrator for Management and Administration to implement an electronic records management program that meets the requirements of 36 CFR 1222, 36 CFR 1228 and 36 CFR 1234. The implementation of an electronic records management program is underway. No timeline is provided in 36 CFR for the establishment of the e-systems element. The program office is currently at an impasse with the OIG audit report and a new target date for final action has not been established.

Report #A1-06, Evaluation Of SBAās Computer Security Program
Program:OCIO
Date Issued:09/28/01
Management Decision Date:01/09/02
Explanation:There are two recommendations. To correct, mitigate or accept vulnerabilities identified in SBAās risk assessments, and to update SOP 90-47, ćAutomated Information Systems Security Program.ä The OCIO purchased a software tool and entered into contracts to mitigate weaknesses at the general support system level. This recommendation is expected to be finalized by 12/31/04. For the second recommendation, the OCIO reviewed comments from the OGC and is revising the SOP to add SBAās position on peer to peer technology. After this review, the document will be returned to OGC for another review. The target date for this final action has passed and a new target date has not yet been determined.

Report #0ö14, 7(a) Service Fee Collections
Program:OCFO
Date Issued:03/30/00
Management Decision Date:08/22/00
Explanation:The recommendation is to establish receivable accounts for 7(a) loan service fees. The OIG agreed in January 2004 to remove this recommendation subject to its review of the process to collect delinquent 7(a) servicing fees. The OCFO is working with OIG to determine what documents are needed for its review. The target date for final action is 12/31/04.

Report #0ö19, Small Disadvantaged Business Certification Program Obligations and Expenditures
Program:GC/BD
Date Issued:06/30/00
Management Decision Date:03/30/01
Explanation:The recommendation is to seek a basis to require mandatory reimbursement from other agencies to fund the Small Disadvantaged Business Certification (SDB) program through an Executive Order or amendments to the Federal Acquisition Regulations. GC/BD proposes to continue use of the Economy Act for reimbursement from other agencies for SDB. Federal agencies have volunteered to pay early in the calendar year versus near year end. GC/BD has chosen to work collaboratively with the Federal agencies for SDB certification reimbursement rather than to divisively mandate payment through an Executive Order or amendments to the FAR. The target date for final action has passed, a new target date has not yet been determined.

Report #0ö30, SBAās Administration of the MBELDEF Cosponsorship
Program:SDB
Date Issued:09/30/00
Management Decision Date:03/26/01
Explanation:Five recommendations remain open to the Associate Administrator for Business Initiatives (AA/BI) to incorporate safeguards into cosponsorships, require the cosponsorship program official to obtain appropriate training, determine the pro rata share of food costs for non-government attendees versus the amount collected, and ensure the responsible program officials report cosponsorship performance problems to the AA/BI, in accordance with SOP 90 75 2. Additionally, the audit recommends the Associate Deputy Administrator for Government Contracting and Minority Enterprise Development (GC/MED) take steps to ensure that GC/ MED employees enforce the terms of cosponsorship agreements. The Office of Strategic Alliances is revising SOP 90 75 to include cosponsorship guidance and has completed a series of trainings for all Headquarters, regional and field offices. The Office of Business Development is working with the Office of General Council to collect monies owed by MBELDEF and also issuing an Information Notice regarding cosponsorship agreements. The target dates for final action have passed, new target dates have not yet been determined.

Report #ö31, Boscart Construction, Inc.
Program:SDB
Date Issued:09/30/00
Management Decision Dates: 02/26/01 & 03/26/01
Explanation:The recommendation is for the designated Agency Ethics Official to review the Agencyās policies and procedures, ensuring compliance with the Agencyās Standard of Conduct Regulations. This is not an ethics issue, but actually internal policy. The OGC issued a draft proposal outlining what this internal policy might encompass and provided a copy to the IG. Creating vetting procedures for the Agency is one of the responsibilities of the recently created Office of Strategic Alliances. OSA is drafting a policy Notice and SOP. The target date for final action is 10/22/04.

Report #1ö09, SBAās Planning and Assessment For Implementing Presidential Decision Directive 63
Program:OCIO
Date Issued:03/26/01
Management Decision Date:09/27/01
Explanation:The recommendation is to ensure the Chief Infrastructure Assurance Officer (CIAO) revises the Critical Infrastructure Protection Plan to address protection of the Agencyās physical minimum essential infrastructure. The OCIO will meet with the Deputy CIAO to address audit findings relating to field office physical security, establish duties and responsibilities of the Deputy CIAO. The target date for final action has passed and a new target date has not yet been determined.

Report #1ö11, Results Act Performance Measurement For The Minority Small Business and Capital Ownership Development Program
Program:8(a)
Date Issued:03/27/01
Management Decision Date:09/28/01
Explanation:There are three recommendations to the Associate Deputy Administrator for Government Contracting and Business Development (GC/BD) to 1) ensure SBA measures the success of the 8(a) Business Development program in accordance with the measure of success prescribed in P.L. 100-656, 2) the Performance Plans include indicators for determining how effectively and efficiently the 8(a) program is operating, and 3) the Performance Plans accurately describe and report performance indicators and data. For the first recommendation, GC/BD recently completed an analysis of the SACS/MEDCOR system and found ways to improve the system to provide more reliable data on 8(a) participants. Regarding the second recommendation, GC/BD established indicators to measure the number of contracts to 8(a) program participants; training to participants for specific criteria within participantās business plans; and for defining success and graduation. And, for the final recommendation, GC/BD will ensure that its next Results Act Annual Report will accurately describe and report performance indicators and data. The target dates for final action have passed and new target dates have not yet been determined.

Report #1ö12, SBAās Information Systems Controls ö FY2000
Program:OCIO
Date Issued:03/27/01
Management Decision Dates: 07/3/01 & 07/24/01
Explanation:The two recommendations are to the Office of the Chief Information Officer (OCIO). These recommendations are to develop quality control program procedures to periodically review existing applications to assure documentation is kept current and accurately reflects the cumulative effects of program changes made over time, and continue its efforts to identify and eliminate incompatible duties, responsibilities and functions. The change management and quality assurance procedures have been finalized. The CIO has instituted Project Health Checks for major projects. These health checks will be performed quarterly by the new Project Management Officer. The OCIO is developing reports for the program office representatives and security administrators to review and for monitoring the access accounts and privilege levels. The target dates for final action have passed and new target dates have not yet been determined.

Report #1ö16, SBAās Follow-Up On SBLC Examinations
Program:CA
Date Issued:08/17/01
Management Decision Date:09/25/01
Explanation:There are two recommendations to Capital Access to develop and implement formal procedures for the Small Business Lending Companies (SBLC) examination follow-up process and ensure appropriate corrective actions are taken in a timely manner, and to develop and promulgate internal control standards for the SBLC program similar to those required for non-SBLC lenders subject to financial institution regulators. On September 30, 2004, the Administrator approved the establishment of a Lender Oversight Committee. The Office of Lender Oversight (OLO) will report to the committee on SBLC examination schedules, examination results and followup actions. The committee process provides a formal structure for SBLC examination follow-up. This committee will also provide the supervisory oversight recommended in the audit report. The target dates for final action for these recommendations have passed and new target dates have not yet been determined.

Report #1ö19, PLP Oversight Process
Program:7(a)
Date Issued:09/27/01
Management Decision Date:08/27/02
Explanation:The recommendation is to revise the scoring for the annual review process to ensure the volume and weighting of point values of other questions does not offset low scores for eligibility and credit quality. The Office of Lender Oversight (OLO) completely redesigned the review process eliminating the scoring approach and implementing a risk based approach to oversight for SBAās largest lenders. Additionally, with the implementation of the loan monitoring system, all lenders are risk rated based on their performance and credit quality. This method of oversight is the primary means of reviewing SBA lenders. The SOPs for risk based reviews and off-site monitoring will be in clearance during the first quarter of FY2005. A formal document approving the overall approach for OLO was cleared on September 30, 2004. The SOPs implementing this new approach will follow. The target date for final action has passed and a new target date has not yet been determined.

Report #1ö20, Agreed-upon Procedures Report on Sensitive Payments
Program:OCFO
Date Issued:09/28/01
Management Decision Date:12/18/01
Explanation:The recommendation is to issue a Procedural Notice to remind SBA offices of the need to follow SOP 20 11 regarding the use and requirements for completion of SBA form 1179. A revision to this SOP has been in clearance with the OIG since May 2004. It includes an update to SBAās policy on conference meetings that will satisfy this audit recommendation. The final action is expected to be completed by 12/31/04.

Report #2ö12, Improvements In The SBLC Oversight Process
Program:OLO
Date Issued:03/20/02
Management Decision Date:08/27/02
Explanation:The two recommendations are to develop a formal policy regarding effective supervisory and enforcement actions, and to implement a system similar to that used by bank oversight organizations to assist in establishing lines of authority between the Office of Lender Oversight (OLO) and the Office of Financial Assistance (OFA). On September 30, 2004, the Administrator signed a document which clearly established OLOās roles and responsibilities. It includes defining responsibilities with regard to supervision and enforcement actions for SBLCs and a Lender Oversight Committee. The committee will provide the supervisory and enforcement oversight recommended in the audit report and is similar to that used by bank regulatory agencies. The target dates for final action have passed and new target dates have not yet been determined.

Report #2ö17, SBAās FY2001 Financial Statements ö Management Letter
Program:OCFO
Date Issued:04/12/02
Management Decision Date:09/18/02
Explanation:There are three recommendations. One recommendation is for the OCFO, in conjunction with Capital Access, to evaluate SBAās Loan Accounting System to determine whether it provides adequate access to the borrower contact information necessary for servicing PERFORMANCE AND ACCOUNTABILITY REPORT FISCAL YEAR 2004 APPENDIX 3 401 loans and financial reporting. All loans processed electronically, via e-Tran (approximately 30% of 7(a) volume) feed the Sybase database with additional borrower location and contact data. This final action is expected to be completed by 9/30/05. The remaining two recommendations are to the Office of the Chief Information Officer to determine if other information systems containing confidential sensitive information are protected from unauthorized access, and to establish procedures to periodically monitor software installed at workstations to assure proper licensing and authorized access to data. The OCIO has verified that the C&A process identifies sensitive information and is testing access controls that protect sensitive information from unauthorized access. There were several problems identified with the Track It inventory function. The latest version of this software will reportedly correct these problems. When it is installed, procedures will be developed to collect the data and review procedures will be put into effect. The final action target dates for the two OCIO recommendations have passed and new target dates have not yet been determined.

Report # 2-18, SBAās Information Systems Controls Fiscal Year 2001
Program:COO
Date Issued:05/06/02
Management Decision Dates: 06/28/02 & 08/15/02
Explanation:There are three open recommendations. Two are for the Chief Operating Officer, in conjunction with Office of the Chief Information Officer (OCIO), Office of Human Resources and appropriate program offices to develop an Agency-wide security plan and to provide adequate funding and resources to allow OCIO to develop and implement technical training for security staff and network and application security administrators. The remaining recommendation is to the OCIO, in conjunction with appropriate program offices, to develop and implement standard operating procedures for network system and security administrators. The Compensation and Benefit Board has approved additional resources for OCIO IT Security. In addition, SBAās FY2005 budget will reflect additional funding for specialize technical IT security training and professional certifications. The Network Integration Branch receives a listing of new and departed individuals on a bi-weekly schedule. All departed personnel accounts are deactivated and deleted after 6 months. Contractor personnel losses are provided by IT Security or the COTR, and accounts are deleted immediately. The OCIO is setting up a Vulnerability Assessment team to enhance the monitoring capability for compliance to policies. The target dates for final action have passed and new target dates have not yet been determined.

Report #2ö22, Travel Of SBAās Former Region VI Regional Administrator
Program:OCFO
Date Issued:08/07/02
Management Decision Date:09/26/02
Explanation:There are two open recommendations: One is confidential and therefore not being detailed in this report, the other is for the CFO to provide training on relevant travel rules and regulations to all newly appointed authorizing and approving officials within 30 days of their appointment. The first recommendation is expected to be finalized by 9/30/05. The second recommendation concerns SBAās eTravel training which will be based on travel SOP 20 11. This SOP is expected to be published by 12/31/04. After SOP publication, the training requirements will be defined and materials prepared. This recommendation is expected to be finalized by 6/30/05.

Report # 2ö27, SBAās Experience With Defaulted Franchise Loans
Program:OFA
Date Issued:9/16/02
Management Decision Date:12/9/02
Explanation:There are two open recommendations for the Office of Financial Assistance (OFA), They should ensure that the Agencyās printed and electronic information on franchises no longer state that franchise-based businesses are significantly more successful than independent businesses, and should clearly define what constitutes a franchise loan. An Information Notice is in clearance to satisfy the first recommendation. OFA management is reviewing additional comments received from the OIG regarding the second recommendation. The target dates have passed for both recommendations and new target dates have not yet been determined.

Report #2ö29, Internal Control Over Colson Services Corporationās Contract As Central Servicing Agent For SBAās CDC Program
Program:OFA
Date Issued:9/16/02
Management Decision Date:12/12/02
Explanation:The recommendation is for the Chief Financial Officer to use the Certified Development Company program trial balance to record items on SBAās financial statements. Extensive research is required to resolve SBAās reporting of these balances, SBA is still reviewing this issue for financial reporting. This recommendation is expected to be finalized by 6/30/05.

Report #2ö34, SBAās Controls Over The Access, Disclosure And Use Of Social Security Numbers By Third Parties
Program:OA
Date Issued:9/30/02
Management Decision Date:7/23/03
Explanation:The recommendation is for the Office of Administration to direct the development and implementation of management controls over contracting activities involving Privacy Act information. We have identified the appropriate nondisclosure contract clause and are reviewing the appropriate contract files to ensure that they are included. This recommendation is expected to be finalized by 10/31/04.

Report #3ö02, SBAās Federal And State Technology Partnership (FAST) Program
Program:FAST
Date Issued:1/6/03
Management Decision Date:9/30/03
Explanation:There are two recommendations for the Office of Technology (OT) to refine its guidance to better assist prospective FAST applicants and to develop clear guidance for recipients on how performance measurement reporting should be linked to indicators included in the technical proposals. OT addressed these issues in the FY2004 Program Announcement. But this approach did not fully address the audit finding. The OT will revisit these issues in the FY2005 Program Announcement, if funds are appropriated. The target dates for final action have passed, new target dates have not yet been determined.

Report #3ö05, Eligibility Of 15 HUBZone Companies And A Review Of The HUBZone Empowerment Contracting Programās Internal Controls
Program:HUBZone
Date Issued:1/22/03
Management Decision Date:7/10/03
Explanation:The recommendation is for the Office of HUBZone Empowerment (HUBZone) to develop a plan to conduct an adequate number of program examinations each year to protect program integrity and lessen opportunities for contracting fraud. The Office of HUBZone Program has developed and implemented a plan to conduct program examinations on 5% of its portfolio, annually, to protect program integrity and lessen fraud. This plan is now under review by the Chief Operating Officer. The target date for final action has passed and a new target date has not yet been determined.

Report #3ö13, Economic Injury Disaster Loans
Program:ODA
Date Issued:3/14/03
Management Decision Date:3/14/03
Explanation:Three recommendations remained open at the end of FY2004, to define the term ćavailable net assets,ä to establish a ratio that identifies reasonable available net assets relative to the economic injury loan amount, and to use empirical data to determine the appropriateness of using the $750,000.0 threshold of total net available assets and the blanket application of the 50% equity rule. The final actions for all three of these recommendations were completed in early October 2004 and these recommendations are now closed.

Report #3ö14, TEP Consulting Inc.
Program:OVBD
Date Issued:3/14/03
Management Decision Date:4/10/03
Explanation:The open recommendation is to the Office of Administration (OA) to recover, from TEP Consulting, the unallowable and unsupported costs charged to the cooperative agreement. OA exhausted all avenues for collecting money and is awaiting the opinion of the Agencyās Office of General Council for concurrence on debarment and suspension. The target date for final action has passed, a new target date has not yet been determined.

Report #3ö18, Grants To The Texas Center For Womenās Business Enterprise
Program:WBO
Date Issued:3/20/03
Management Decision Date:6/4/03
Explanation:The two remaining recommendations are for the Office of Administration (OA) to require The Texas Center For Womenās Business Enterprise to refund unsupported costs and to refund the costs of the vehicle furnished to the former Executive Director for personal use. OA exhausted all avenues for collecting money and is awaiting the opinion of the Agencyās Office of General Council for concurrence on debarment and suspension. The target dates for these final actions have passed, new target dates have not yet been determined.

Report # 3ö20, SBAās Information System Controls For FY-2002
Program:Agency Management
Date Issued:3/31/03
Management Decision Date:5/12/03 through 7/15/03
Explanation:There are eight open recommendations. One recommendation is to the Office of Human Capital Management, in conjunction with OCIO, to designate the NFC payroll/personnel system as a critical system and proceed to develop an application systems security plan. The CIOās Security Staff conducted an on-site visit to the National Finance Center to investigate the SBAās Personnel/Payroll System. They developed a systems security plan and implemented a time table to correct deficiencies. The Acting Chief Human Capital Officer and the Chief Information Officer certified and accredited the Personnel/Payroll System. The OCIO also added the Personnel/Payroll System to the SBAās Critical Application List. Another recommendation is to the CFO, in conjunction with OCIO, to update the systematic password and log-in controls in JAAMS so that it is consistent with SBA standard password policy. The current version of Oracle Federal Financials will not allow us to take any corrective action. As application upgrades occur to the software, SBA will re-assess the situation. Currently, we anticipate upgrading Oracle in early FY2005.

The six remaining recommendations are directed to the CIO. To fully implement the planned upgraded intrusion detection system and reporting monitoring tools. The OCIO is awaiting contract approval to have an independent vendor evaluation of the network and to make a recommendation on sensor placements. We expect to have these activities during the first quarter of FY2005. Recommend the CIO develop and implement policies and procedures regarding its access and password policies. All network administration accounts now require passwords for activation. Accounts are checked monthly to ensure passwords are required. The target date for final action has passed, a new target date has not yet been determined. Recommend the CIO enforce the procedures currently in place and remove all unauthorized remote desktop software from workstations. There is currently no comprehensive list of Agency approved software. However, users do not have the administrative rights (ifie., access) to install any software on SBA computers. The target date for final action has passed, a new target date has not yet been determined. Recommend the CIO provide a standard configuration for Windows 2000 consistent with NIST and NSA guidelines, and further recommend the CIO complete the implementation of Windows 2000. Windows 2000 is configured in accordance with NIST standards. The completion of full implementation of Windows 2000 is contingent upon the Sacramento Loan Servicing Center upgrade to Windows 2000 which is scheduled for the first quarter of FY2005. Recommend the CIO require the JAAMS security administrator to perform an annual review of users to ensure no user has excessive access and all users are currently authorized JAAMS users. The OCIO developed account managing procedures to address this issue. The target date for final action has passed and a new target date has not yet been determined. Recommend the CIO provide adequate training and periodic retraining to enable JAAMS security administrators to effectively perform their duties. The OCIO has scheduled a meeting with the CFO to discuss this periodic training for JAAMs Administrators. This recommendation is expected to be finalized by 11/14/04.

Report #3ö23, Selected Aspects Of The Service Corps Of Retired Executives (SCORE) Program
Program:ED Date Issued:4/11/03 Management Decision Date:9/30/03 Explanation:The one remaining open recommendation is for the Office of Business and Community Initiatives to determine the source of authority that permits SBA to provide funding for National SCORE Office paid staff. This recommendation cannot be finalized until Congress passes the final SBA reauthorization authorizing a paid SCORE headquarters staff. This recommendation is expected to be finalized by 9/30/05.

Report #3ö24, SBAās FY2002 Financial Statements Management Letter
Program:OCFO Date Issued:4/14/03 Management Decision Date:6/25/03 through 8/7/03 Explanation:There are four recommendations. They are for the CFO to: strengthen financial reporting internal controls to ensure proper year-end cut-off, maintain transactional detail for all prior year obligation adjustment transactions, perform an analysis of contra balance undelivered orders to determine how to properly remove them from the general ledger detail, and ensure every undelivered order transaction is processed in accordance with SGL criteria and has sufficient supporting transactional detail. The Oracle 11i system upgrade implementation is planned for October 12, 2004, followed by an evaluation of its functionality for undelivered orders processing. This final action is expected to be finalized during the first quarter of FY2005.

Report #3ö26, MicroLoan Program:Moving Toward Performance Management
Program:MicroLoan Date Issued:5/13/03 Management Decision Date:8/28/03 Explanation:There are five recommendations to the Office of Financial Assistance. 1) Ensure the development of a comprehensive MicroLoan program SOP, 2) ensure the current MicroLoan production minimum for intermediaries is raised, 3) ensure that a standardized manual template for reporting technical assistance quantitative data be developed, 4) ensure that the MicroLoan Program develops comparative cost data to manage the program, and 5) ensure program staff encourage individual program participants to collect outcome measures that focus on business sustainability and job creation over the long term. The FY2005 budget request included zero funding for the MicroLoan Program. As the program was slated to be discontinued, OFA ceased concentrating on completion of an SOP. Based on Congressional activity, it now appears that funding for the MicroLoan Program will be made available and work on the SOP has resumed. This final action is expected to be completed 12/31/04. OFA agrees that the production minimum should be raised, but this requires a regulatory change. OFA has begun working with OGC on a revision of the regulation. We estimate this recommendation cannot be fully implemented until late FY2005. OFA has been working with the field of NTAP organizations to develop a clear range of appropriate data collection fields for a standardized manual template. Based on the budget, competition and selection calendars, actual reporting will probably begin during the first quarter of FY2006. OFA has implemented a cost based system for funding intermediary lenders and NTAP organizations. Beginning with awards made in FY2004, cost averages were integrated into the mandated debt percentage calculations for all MicroLoan Program grants. As a result, all intermediary lender grants allocated under the statutory basis of percentage of debt were further delineated based on the comparative costs of providing technical assistance to both existing and potential MicroLoan clients. NTAP grants awarded in FY2004 were also allocated based on the costs of providing technical assistance to clients seeking private sector funding. The target date for this final action has passed, a new target date has not yet been determined. Following internal discussions with the OIG, it was agreed that the Agency could/should not, at the present time, mandate collection of long term sustainability and job creation data from MicroLoan participants. However, OFA did agree that the MicroLoan program and industry would benefit from the collection of this data within available resources. The target date for this final action has passed, a new target date has not yet been determined. Final action on recommendations four and five have been accepted by the OIG as of the end of FY2004.

Report #3ö32, SBAās Acquisition, Development And Implementation Of The Joint Accounting And Administrative Management System
Program:OCFO Date Issued:6/30/03 Management Decision Date:9/11/03 Explanation:The recommendation is for the CFO to seek monetary recovery from World Wide Technology, Inc. or an in-kind contribution of additional Oracle Discoverer licenses to compensate for the unusable Financial Analyzer software. OCFO has been working with OCIO and GSA on the Governmentās enterprisewide initiative. GSA has not issued clear direction yet. Therefore, OCFO will await the GSA decision before determining final resolution for this recommendation. A final action is not anticipated until 4/30/05.

Report #3ö34, SBAās Compliance With JFMIP Property Management System Requirements
Program:Agency Management Date Issued:7/23/03 Management Decision Date:9/11/03 Explanation:There are two recommendations to the CFO. To either establish and implement an interface for the FAAS and the AAP with JAAMS, or consolidate the reporting of all property management functions in JAAMS. The SBA currently uses manual processing to record new property in its property and general ledger systems. Recently the OCFO issued a procedural notice to improve the compliance with existing procedures to record new property and inventory old property. An improvement to the financial systems managing property will be reconsidered as part of FY2005 financial management priorities. The second recommendation is to revise and update SOP 20 13 to reflect changes in policies and processes required for managing property. A draft notice was developed, but is now being reworked to include changes regarding capitalized property thresholds. These recommendations are expected to be completed during the first quarter of FY2005.

Report #3ö35, National Womenās Business Council
Program:Agency Management Date Issued:7/28/03 Management Decision Date:9/03/03 Explanation:This recommendation is to the NWBC Executive Director to require Springboard 2000 Enterprises, Inc. (SBE) and Forum for Women Entrepreneurs (FEW) to provide justification for receiving $579,368.0 based on expenses incurred. Upon review of the opinions provided by the SBAās Associate General Counsel for Litigation, the program office recommended that no further action be taken. It did not appear to be in the best interests of the Government to pursue this item further. A final action was submitted to the OIG, but not approved, because the program office did not present a compelling reason not to follow through on the audit recommendation that required SBE and FWE to provide justification for receiving monies from the various forums based on estimated expenses incurred. The target date for this final action has passed and a new target date has not yet been determined.