Audit Report 4-09: Audit of SBA Purchase Cards
On January 26, 2004, the OIG issued Audit Report 4-09, Audit of SBA Purchase Cards. The objective of this limited scope audit was to determine if SBA purchase cardholders made any improper or potentially fraudulent purchases. The scope of the audit was limited to selected purchase card transactions by SBA cardholders posted from May 1, 2002 to June 30, 2003. The OIG also compared a list of active cardholder accounts to a list of current SBA employees as of May 20, 2003 and again as of October 16, 2003, to determine whether any cardholders that separated from the SBA still had open purchase cards in their name and whether any purchases had been made since the cardholder left the Agency.
The OIG did not identify any potentially fraudulent transactions; however, the review identified five purchases over $2,500 that did not comply with terms of the Federal Acquisition Regulation (FAR). These purchases were split into multiple charges to keep each charge under the $2,500 micro-purchase threshold, thus circumventing FAR requirements to set aside acquisitions over $2,500 for competition among small businesses. Additionally, the OIG found several weaknesses in the program’s internal controls. Forty-two requisition forms were unsigned by the approving official, more than half of the cardholder statements examined did not have the approving official’s certification, and four cardholder accounts remained open after the cardholders separated from service with the SBA. No purchases were made after these employees separated. The OIG made two findings and two recommendations. The first finding related to split purchases and the second related to weaknesses in the program’s internal controls.