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Accountability & Transparency in the TARP & ARRA: GAO’s Role. Susan Offutt Chief Economist 15 October 2009 Society of Government Economists. Types of supreme audit institutions. Napoleonic Westminster Board. Audit responsibilities. - PowerPoint PPT Presentation
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Accountability & Transparency in the TARP & ARRA: GAO’s RoleSusan OffuttChief Economist
15 October 2009Society of Government Economists
Types of supreme audit institutions
Napoleonic Westminster Board
Audit responsibilities
Financial audits assess accuracy and fairness of financial statements
Compliance audits review gov’t taxing and spending for conformance with law
Performance audits aim to establish whether taxpayers have gotten what they paid for
Performance audits
Performance measurement entails regular assessment of progress made toward goals
Program evaluation judges effectiveness of a program Process or implementation Outcome Impact Cost-benefit
American Recovery & Reinvestment Act
Signed February 17, 2009 Total cost (tax and spending): $787 billion Purposes
Preserve and create jobs and promote recovery
Assist those most impacted by recession Invest in science and health care
technology Invest in infrastructure Stabilize state and local gov’t budgets
GAO responsibilities under the Recovery Act Conducting bimonthly reviews of selected
states’ and localities’ use of funds Commenting on recipient reports on the
numbers of jobs created or preserved Reviewing areas such as trade adjustment
assistance, new education incentive grants, and efforts to increase small business lending
Monitoring downturn’s long term effect on states (primarily in change in health care costs)
State & local reporting for bimonthly reviews Longitudinal study of 16 states and DC Represents about 2/3rds of US population
and 2/3rds of intergovernmental assistance funds
Localities sampled within selected states
Describe use of funds Assess up-front safeguards and ongoing
monitoring, audits, and evaluations Review plans to evaluate impact of funds
American Recovery & Reinvestment Act1. Arizona
2. California
3. Colorado
4. Florida
5. Georgia
6. Illinois
7. Iowa
8. Massachusetts
9. Michigan
10. Mississippi
11. New Jersey
12. New York
13. North Carolina
14. Ohio
15. Pennsylvania
16. Texas
17. Washington, D.C.
Programs in GAO Review: 87% of estimated Fiscal Year 2009 Recovery Act Outlays to States and Localities
Source: GAO analysis of data from CBO and Federal Funds Information for States.
Projected versus Actual Federal Outlays to States and Localities under the Recovery Act
Source: GAO analysis of data from CBO, Recovery.gov and Federal Funds Information for States.
0
20
40
60
80
100
120
2009 2010 2011 2012 2013 2014 2015 2016Fiscal year
Estimated
$51.1 billion in Actual Federal Outlaysas of September 25, 2009
Outlays in billions of dollars
Comparison of State and Local Recovery Act Funding
Source: GAO analysis of CBO and FFIS data.
GAO recommendations
Accountability and transparency
Reporting on impact
Communications and guidance
Implementing and overseeing the Recovery Act Expectations for “an unprecedented level
of transparency and accountability” Qualified personnel need to implement
proper controls and accountability at all levels of gov’t
Close and ongoing coordination needed among federal, state, and local gov’ts
Accountability community has special responsbility to ensure collective efforts are coordinated well
GAO’s work onfinancial markets and institutions Oversight of Troubled Asset Relief
Program (TARP) Audits of FDIC Deposit Insurance Fund,
FHFA, TARP, and US Gov’t Financial Statements
Evaluation of financial regulatory system Participate in INTOSAI task force on the
global financial crisis
TARP components
$700 billion in TARP funds As of September, $364 billion disbursed
Capital purchase program ($200b) Targeted investment program ($40b) Systemically significant failing institutions
($43b) Automotive industry financing ($76b) Consumer & business lending ($.1b)
Anticipated Home affordable mortgage program Public-private investment program
GAO oversight
Must report to Congress every 60 days Reports address range of management
and program concerns Recommendations to date
Better monitoring of use of TARP funds Better articulation of purposes of programs Improve management structure