More--And Better--Audits Needed of CETA Grant Recipients

The Department of Labor relies on the audit as a basic tool for preventing unauthorized expenditures and seeing that Comprehensive Employment and Training Act (CETA) programs are carried out as Congress intended.

Labor has fallen far short of its goal of auditing all organizations receiving CETA funds every 2 years; some sponsors have not yet been audited even once. Fewer than half the required audits of CETA funds have been performed, and the quality of completed audits is uneven. The audit function could accomplish more if it had additional resources. Labor did not have adequate information on the extent to which subsponsor's funds are being audited. For audits of prime sponsors, Labor has not required an analysis of the grantee's controls over funds subgranted or contracted. Although Labor has subsponsor audit requirements, such audits are performed separately and are the grantee's responsibility. If controls are weak at the subsponsor level, the fragmented audit process makes it difficult for Labor to identify and correct such weaknesses. Labor's difficulty in controlling the audit process stems largely from a shortage of staff in the Inspector General's Office and a historic lack of commitment to the audit process on the part of Labor. Audits performed did not always conform to required audit standards. The audit function has nevertheless benefited the CETA program and Labor. Auditors have recommended that grantees establish better internal controls and better management of cash transactions.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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