Review of Department of Education FY 1980 Interagency Fund Transfer Agreements

GAO examined selected Department of Education fiscal year 1980 transfers to determine whether any of those agreements violated any laws. GAO discussed the procedures for developing the fund transfer agreements with Education officials and reviewed their written guidelines. GAO examined most of the agreement documents and related accounting records to: (1) determine the purpose of the transfers; (2) verify the amounts that were transferred; and (3) evaluate the legal authority cited as permitting the transfers.

Education officials could not find 14 of the 83 agreements shown on the fiscal year 1980 list. Only three of the missing agreements, totaling $89,500, were shown to be obligated or paid in the accounting system, so it is possible that the other missing agreements were canceled. Agencies that were to receive the funds from the missing agreements could not locate them either. The most common purpose of the agreements in question was to reimburse other Government agencies for goods and services to be provided to Education. Such transactions are sanctioned by the Economy Act and other laws in various circumstances. The purpose of the Economy Act is to allow agencies to acquire goods and services from other agencies whenever it is more convenient or whenever it is less expensive than obtaining them from non-Government sources. The procedures to be followed in making interagency agreements require standard written agreements to be developed before the funds can be transferred. The agreement must contain a description of the goods or services being acquired, the amount to be transferred, and the legal authority for making the transfer. Each agreement must be reviewed by the contracting or legal staff before being approved. GAO found that Education had adequate legal authority to enter into the agreements which were reviewed. The agreements generally complied with the departmental instructions as well as applicable laws. Four agreements which cited no specific authority were not questioned because the transfers would have been permissible under existing laws.