Description of document: Library of Congress (LOC), Office of the Inspector General Semiannual Report to the Congress For 01-Apr-2006 - 30-Sep-2006
Released date: 28-February-2008 Posted date: 10-March-2008 Date/date range of document: 01-Apr-2006 - 30-Sep-2006 Source of document: The Library of Congress
Office of the Inspector General 101 Independence Ave, SE Washington, DC 20540
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COUNSEL TO THE IG
Vacant (Part-Time)
INSPECTOR GENERAL
Karl W. SchornagelCPA
ASSISTANTTO THE IG
Kathleen L. O'Neal
........................................................................................................
ASSISTANT INSPECTORGENERAL FORINVESTIGATIONS
Nicholas G. ChristopherEsq., CPA
.......................................................................................................
Kenneth R. Keeler
SENIOR AUDITOR
John W. Kane
SENIOR AUDITOR
John R. MechCPA
AUDITOR
Sherry D. AngwafoEsq.
Cover: U.S. Capitol Rotunda
\.
SENIOR AUDITOR
Patrick J. CunninghamCIA
AUDITOR
Cornelia E. Jones
AUDITOR
Douglas C. McLellanCPA
SENIOR AUDITOR
Judy M. FischerCISA, CIA
IT SPECIALIST
Vacant
AUDITOR
Mary A. HarmisonCPA
AUDITOR
Vacant
SPECIAL AGENT
Pamela D. Hawe(Part-Time)
INVESTIGATOR
Barbara A. Hennix
INVESTIGATOR
Vacant(Part-Time)
LEGAL ASSISTANT
Michael R. Peters
i. The LIBRARY of CONGRESS
Ocrober 31, 2006
A MESSAGE FROM THE INSPECTOR GENERAL
I am pleased ro presem our Semiannual Report ro the Congress for the period ending September 30, 2006.
In the last six momhs we prepared reports on performance-based budgeting, warehouse comrols, the "North Carolina
Telecommunications Project" grant, the fiscal year (FY) 2005 Library-wide and Cooperative Acquisitions Program Revolving
Fund financial statemems, the digital talking book program, the NEWSUNE fund, and indirect COSt rates related ro two of
the Library's gram programs. We also reviewed the initiative to acquire an asset managemem system and project plans for
the "New Visitors' Experience." In addition, we followed up on our FY 2004 audit of reading room space allocations and
FY 2005 audit of succession planning, and cominued to monitor visitor runnel preparation activities. Finally, we conducted
several investigations on tOpics ranging from copyright infringemem to personal information securiry.
In the next six momhs, we will report on in-progress reviews of the Library's collections acquisition program, human
resources policies, travel administration, managemem of the contracts office, financial disbursemems, research request
services, National Digital Information Infrastructure and Preservation Program grants, the Library's and Madison Council's
FY 2006 financial statements audits, the FY 2006 financial statements audit of the Open World Leadership Center, and
other topics.
We look forward to a continued harmonious relationship with Library management, and appreciate the support and
cooperation extended to our staff.
Karl W. Schornagel
Inspector General
TABLE OF CONTENTS
INTRODUcnON .
AUDITS 3
Performance-based Budgeting..................................................................................................... 3
Telecommunications Grant.......................................................................................................... 3
Warehouse Internal Controls....................................................................................................... 4
Library of Congress Financial Statements 5
Cooperative Acquisitions Program Financial Statements 6
INVESTIGATIONS..... 8
FOLLOW-UP ON PRlOR PERlOD RECO;\IMENDKflONS......................................................................................... 12
Visitor Tunnel Preparations.......................................................................................................... 12
Education and Research Consortium of the Western Carolinas............................................ 12
Succession Planning.. 13
Reading Room Utilization............................................................................................................. 13
UNI~[PLD[ENTED REC01\1MENDATIO<'..'S................................................................................................................ 14
FUNDS QUESTIONED OR PCT TO BElTER USE........................................... 17
INSTA.'.:CES WHERE INFORJvIATIO, OR ASSISTANCE REQCESTS \X/ERE RUCSED................................................ 18
STATCS OF RECOM1\'IFNDATIONS WITHOUT MANAGEMENT DECfSIONS.............................................................. 18
SIGNIFICA.'.:T REVISED MANAGEMENT DECISrONS.............................................................................................. 18
SIGNIFICANT MANAGOfENT DECISIONS WrrH WHICH OIG DiSAGREES......................................................... 18
OTHER ACflVITlES.................... 19
REVIEW OF LEGrSLATION AND REGULATIONS..................................................................................................... 21
INTRODUCTION
THh MI~SIO~ OF THI:. OFFICi'. OF THI:. INSPI:ClOR GENFRAI IS I'o PRO\10TI:. bCONOMY,
HFICIENCY, AND l-.FFECTIVl-.NESS BY DE'l H'TlNG AND PRl-Yl-.N l'ING \X'ASTr, FR.,\UD, AND
ABUSl-.
To accomplish our mission. we conducr audirs and invesrigarions. Our goals, objecrives, srraregies, and performance
indicarors can be found in our Srraregic Plan, available on our Web sire ar hrrp:llwww.loc.gov/abour/oig.
In addirion ro conducring audirs and invesrigarions, we lend our experrise on a consulring basis ro many Library offices
and exrernal organizarions. We are currenrly working wirh rhe Cenrer for Research Libraries in an advisory capacity ro
derermine an approach for audiring and cerrifying reposirories of digiral informarion.
Our philosophy is ro be proacrive rarher rhan audir "afrer rhe facr." We believe rhis approach resu!rs in a more efficienr use
of resources by derecring and prevenring problems early. Accordingly, we are following several key projecrs rhroughour rhe
Library and rendering assisrance and making recommendarions as needed.
Our highly qualified sraff of eighr audirors and cwo invesrigarors is educared and cerrified in various disciplines. We
are, collecrively. five cerrified public accounranrs, cwo arrorneys, cwo cerrified inrernal audirors, one certified informarion
sysrems audiror, and one librarian.
SEMIANNUAL REPORI ro I"HE CONGRrSS II
The U.S. Capito!: National Statuary Hall viewed from the south
II SEMIANNUAL R~.POR'J TO THE C()NC;Rt:SS
AUDITS
PERFORMANCE-BASED BUDGETING
\L1da Rcrort o. 211114 I ::;111
"~'r(cll1hl'f 2( JlI()
Congress has direcred me legislarive agencies
including rhe Library ro begin ro use performance
based budgering (PBB). PBB is designed ro improve
governmenral accounrabiliry by linking budger
decisions ro resulrs. This provides decision-makers
wirh rhe means ro objecrively evaluare and allocare
budgerary resources. We conduered a review of
rhe Library's currem budgering process wirh rhe
objecrive of evaluaring Library managemenr's
progress in moving roward PBB.
Our audir found rhar rhe Library has iniriared
rhe developmem of several componems of PBB,
including significam emphasis on revamping
irs srraregic planning process. We concluded
rhar rhe Library's developmem of PBB could be
improved wirh a plan of aerion and milesrones
rhar coordinares PBB developmem wirh orher
performance managemem funcrions. Specifically,
we made rhe following recommendarions for
improving and expediring rhe Library's rransirion
ro PBB:
Plan of Acrion and Milesrones - The Library
should develop a plan rhar idenrifies rhe roles of key
members ofsenior managemem as well as milesrones
for rhe complerion of key PBB elemenrs.
Adminisrrarive Officer - The Chief Financial Officer
should be appoimed as rhe PBB adminisrrarive
officer.
Policy Improvemems - The Library should
enhance irs policy for Planning, Sudgering, and
Program Performance Assessmem by designaring
responsibiliry for conducring exrernal environmenral
assessmems, idemifying duplicarions in programs
and services, and exempring areas from cerrain
elemems of PBS where irs use is impracrical.
Performance Managemenr Informarion Sysrem
- Planning should begin now for an auromared
emiry-wide performance managemem informarion
sysrem.
Coordinarion of Funcrions - Library managemem
should coordinare efforrs for workforce
rransformarion, performance managemem, and
PBB.
Library managemem generally disagreed wirh our
recommendarions. As a resulr, rhey are unresolved
ar rhis rime.
TELECOMMUNICATIONS GRANT
\L1L11l RL'j1I1J'1 1I.2111 1() ')\12
crtclllhn 21 JlI()
In December 200 1, rhe Library awarded rhe Norrh
Carolina Telecommunicarions Projecr (''rhe granr")
ro rhe Educarion and Research Consorrium of rhe
Wesrern Carolinas, Inc. (ERC). The gram's purpose
is ro provide a low-cosr, high-speed connecrion
berween rhe Library of Congress and educarional
faciliries, libraries, and nerworks serving rhe wesrern
Carolinas.
We performed an audir of rhe gram. Our objecrive
was ro derermine if ERC was adminisrering rhe
gram according ro irs rerms and condirions and
applicable laws and regularions. Overall. we found
rhar ERC was adequarely adminisrering rhe gram,
bur had some findings and recommendarions, as
follows:
Noncompliance wirh Cerrain Gram Provisions
ERC did nor comply wirh cerrain gram provisions.
FirsI', ir did nor maimain a separare gram bank
accoum for program income. As a resulr, ir may nO[
have been able ro disringuish berween gram funds
and program income. Second, ERC has neirher
acknowledged rhe Library in cerrain marerials
SEMIANNUAl RJ..l'ORI TO THE CON(.RJ-.SS II
publicizing the grant, nor obtained the Library's approval
prior to using its name in other materials. As a result,
the Library's abiliry to protect the goodwill and prestige
associared with its name is impaired and the general public
is denied rhe oppoerunity to know how its tax money is
being spent. We recommended that ERC immediately
establish a separate bank account for grant program income,
begin acknowledging the Library in the grant's publiciry
marerials, and stop using rhe Library's name wirhour prior
approval.
Lack of Adequate Policies and Procedures - ERe's
Operating Policies Manual did not contain procedures for
drawing down funds, derermining allowability of cosrs,
adminiStering program income, acknowledging and using
the Library's name, or for making key personnel changes.
As a result, adequate safeguards did not exist to control
ERe's program and financial management of rhe grant.
We recommended that ERC make appropriate revisions to
its policy manual to provide procedures to address these
important management areas.
Borh ERC and rhe Library's Grants Management Office
concurred with our findings, and have already begun
implementing our recommendations.
WAREHOUSE INTERNAL CONTROLS
\(r~~l,tll'1I1 R~I'{)rr ll.21111;:i \T ()fJ4
'Llne .21111(,
The Library's Logistics Section manages more than 100,000
assets valued ar over $200 million. Because of recem
rhefrs of Library compurers from the Landover Annex
Warehouse, we conducted a review of rhe internal concrol
system in place at the warehouse to derermine wherher
inventory controls, management oversight, and physical
securiry were comparable ro besr indusrry pracrices.
We derermined that rhe controls are nor comparable to
besr indusrry pracrices. However, management has taken
acrion in rhe pasr two years to address COntrol weaknesses.
If rhese acrions and our recommendations are properly
implemented and pursued continuously, improvements in
physical inventory controls and inventory record accuracy,
as well as physical security for the warehouse will result.
Our findings and recommendations are summarized as
follows:
The Logistics Secrion Has Not Maintained Physical
Accountability of its Inventory - For the two years prior to
thefts of computers, warehouse staff had neither performed
inventories ofassets stored at the warehouse, nor maintained
perpetual inventory records. During our field work,
Logistics was adding inventory dara into a new automated
inventory sYStem, "Intellicrack." We recommended
conducting periodic counts of rhe highly susceptible
assers and comparing rhe counts with inventory records.
We also recommended limiting access to the Intellicrack
system and assigning the Assistant Head of Logistics or a
designated alternate responsibility for recording inventory
adjustments.
Security Measures Did Not Sufficiendy Address the Threat
of Employee Theft - Overall security needs to be bener
targeted to address the threat of employee theft. Although
infrascructure security weaknesses are being addressed,
additional inspections are needed to fuerher improve
ovetall securi ty.
Bener Separation of Duties and Reconciliations Should
Improve Receiving and Shipping - To improve inventory
integrity, we recommended separating the functions
of entering information into the Intellicrack inventory
system and performing the custodial activities such as
receiving, shipping, and storing physical assets. We also
recommended thar Logisrics periodically reconcile all back
orders with rhe service units to determine if rhe vendors
filled the orders.
Grearer Separation of Duries Is Necessary To Ensure
Integrity of rhe "Computers for Learning" Program
Landoverwarehouse staffare responsible for borh processing
requests from charitable organizarions to participare in rhe
program and disposing of surplus propeery. Management
should assign someone nor working at rhe Landover
warehouse responsibility for processing and approving
SEMIANNUAL Rr.PORT 101 HE CONGRESS II
partiCipation requests. We also recommended considering
the surplus program operated by Dell Computers, Inc. as
a best practice.
The Library's warehousing and security officials generally
agreed with our findings.
LIBRARY OF CONGRESS
FISCAL YEAR 2005 FINANCIAL STATEMENTS
\udlt Rq'"l"f "\.11. 21 II I.:;
\ L1\ 2\ 111(\
Kearney & Company audited the Library's consolidated
balance sheets as of September 30, 2005 and 2004, and
the related consolidated statements of net COStS, changes in
net position, and financing, and the combined statements
of budgetary resources for the fiscal years then ended. In
the auditOrs' opinion, the financial statements, including
the accompanying notes, present fairly in all material
respects the financial position of the Library and its net
COStS, changes in net position, budgetary resources, and
financing in conformity with generally accepted accounting
principles. The Library's financial statements were delayed
because of the implementation of its new financial system
in FY 2005.
The auditors also performed tests of compliance with laws
and regulations; considered internal controls over financial
reporting and compliance; and in a separate report,
examined management's assertion about the effeCtiveness
of internal COntrols over safeguarding collections assets.
The auditOrs found one instance of non-compliance with
laws and regulations. The auditors performed tests of
compliance with certain provisions of laws and regulations
and determined that during FYs 2005 and 2004, the
Library was not in compliance with the CongreSSional
Accountability Act of 1995. In the Act, Congress made
its facilities and employees subject to the same safety laws
that apply outside the legislative branch. l1Je Office of
Compliance conducted a yearlong fire safety investigation
thaI culminated in a report issued in January 200 I thar
identified numerous safety hazards in the Library's three
Capitol Hill buildings. As of this semiannual period, the
Library has abated ninety-nine percent of the fire safety
hazards for which it is responsible, and has devised a plan
of action to abate the remaining open items.
Internal Controls Over Financial Reporting - The auditors
did not express an opinion on internal controls. However,
their evaluation of those controls revealed the following
repOrtable conditions:
Weaknesses in the General Support Systems (GSS)
(Modified Repeat Condition) - The General SuppOrt
Systems include hardware and supporting utility software
to maintain the overall system. Effectively applied, controls
in this area increase the likelihood that data confidentiality,
integrity, and availability are maintained in the application
systems.
The auditors identified control weaknesses in the
Library's GSS that affected the availability, integrity, and
confidentiality of all applications and data residing in the
processing environment. In order to address the control
concerns, the Library's Information Technology Services
(ITS) developed the Financial Hosting Environment
(FHE) to maintain only certified and accredited GSS and
applications. ITS completed the FHE in late June 2005.
While the FHE has appropriate risk assessments, security
plans, and security testing and evaluations, it was in place
for only three months of FY 2005, and therefore could not
be relied on for the nine months of activity prior to the
FHE's implementation.
Entity-Wide Security Program Not Fully Implemented
(Modified Repeat Condition) - The Library had not
implemented an entity-wide security program 10
compliance with Library of Congress Regulation 1620,
"Information Technology Security Policy of the Libtary of
Congress."
While the Library developed a plan and strategy for
an entity-wide security program (dated July 2005), the
program had not been implemented entity-wide. As of
SE.VlIANNUAI REPORt 10 tHE CONGRfSS II
January 2006, however, rhe Library esrablished a more
comprehensive enriry-wide securiry program.
Managemenr's AsserrionAbour rhe Effecriveness oflnrernaJ
Conrrols Over Safeguarding Collecrions Assets - Alrhough
the vaJuarion of rhe coJJecrions of herirage assers is nor
reporred in rhe Library's balance sheer, rhe assers represenr
an imporranr srewardship responsibiliry requiring a sysrem
of conrrols ro ensure accoumabiliry. To rhis exrem, rhe
Library includes in irs financial sraremems a srewardship
reporr and makes an asserrion abour rhe effecriveness of rhe
imernal comrols over collecrions assers.
The audirors evaluared imernal comrols over collecrions
assers by examining, on a resr basis, evidence supporring
managemenr's asserrion and by performing such orher
procedures as rhey considered necessary. The audirors
believe rhar because of inherem limirarions in inrernal
comrols as of Seprember 30, 2005, unaurhorized
acqulSl[lOnS, use, or disposirion of collecrions assers may
occur and may nor be derecred, and rhar rhe Library fairly
represems rhar ir cannor asserr rhar collecrions invemory
conrrols are fully implemenred when herirage assers are in
processing and in srorage.
COOPERATIVE ACQUISITIONS
PROGRAM REVOLVING FUND
FISCAL YEAR 2005 FINANCIAL STATEMENTS
\ud,' Rl PI 'I" t •• 21 Ill') I ')112
\u'U'! 21111(1
In 1958, rhe Congress approved Public Law 83-480,
aurhorizing rhe Library ro use foreign currencies rhat accrued
to rhe governmenr from sales of agriculrural commodiries
to finance rhe acquisirion of books, periodicals, and orher
marerials. The law led ro rhe formarion of rhe Library's
overseas offices and Cooperarive Acquisirions Program.
Kearney & Company audired rhe FY 2005 and 2004
balance sheers and rhe relared srarernenrs of ner cosrs,
changes in net position, budgerary resources, and financing
of the Cooperative Acquisitions Program Revolving Fund
(the Fund) and issued its Independenr Audiror's Report.
The audirors concluded that the financial sraremenrs,
including rhe accompanying notes, presenr fairly in all
marerial respects the financial posirion of rhe Fund as of
Seprember 30. 2005 and 2004. The audirors found no
mareriaJ weaknesses in inrernal conrrols over financial
reporring bur did find two insrances of noncompliance
reporrable under Governmem Audiring Srandards:
Noncompliance wirh rhe Congressional Accoumabiliry
Acr - This finding mirrors the Library's finding lisred on
page 5 regarding safery violations.
Noncompliance with Public Law 105-55 - This law requires
rhe Fund ro submit audited financial sraremems ro rhe
Congress no later than March 31 of each year for rhe prior
fiscal year. The audir of the Fund's financial sraremenrs
was delayed beyond irs srarurory due dare because of rhe
implememarion of rhe Library's new financial sysrem. The
Library advised rhe appropriare Congresional oversighr
commirrees of rhe delay in issuing the sraremems.
The Fund is a componenr of the Library's consolidared
financial sraremenrs. The Library processes all of rhe
Fund's financial uansaction. Therefore, rhe two reporrable
condirions related ro Information rechnology that were
idenrified in rhe Library's financial audir also affecred the
Fund's imernal conrrol structure.
SEMIANNUAL REPORT '10 THE CONl;R.hSS II
INVESTIGATIONS
During this reponing period we opened - and closed - 21 investigations. We referred four cases to
the U.S. Atwrney's Office; of those, three were declined and one is pending. We recovered $4,000 in
telephone credits, and prevented the illegal sale of29 National Library Service for the Blind and Physically
Handicapped (NLS) talking book players. We also forwarded four cases w Library management for
adminisuative action. Case and Hotline activity are detailed below:
TABLE 1: INVESTIGATION CASE ACTIVITY
CRI II \[ (1\11 \() I I I ~ I I
Beginning of period 8 20 28
Opened 7 14 21
Closed 3 18 21
End of Period 12 16 28
TABLE 2: HOTUNE ACTIVITY
(ll I
AJlegations received 2
Referred w management for action 4
Opened as investigations
Closed with no action
II SloMIANNUAI Rt.rORI TO lHE CONGRESS
SIGNIFICANT CRIMINAL AND
ADMINISTRATIVE INVESTIGATIONS
A Cataloging Disrribution Services (CDS) manager
complained ro the Office of me Inspecror General (OIG)
about hundreds of harassing telephone calls from Puerro
Rico to the CDS 1-800 Audix number. The calls incurred
significanr charges billed ro CDS and limited recording
space for legitimate calls. The manager also complained
that over several monrhs, AT&T had not resolved the
problem. OIG special agenrs documenred the offending
calls and worked successfully with AT&T's law enforcemenr
liaison ro obtain a credit for past and furure calls from the
Pueno Rico caller, including a $4,000 credit for prior
charges. Agenrs idenrified and conracted the caller in an
unsuccessful attempt ro srop the calls. We enlisted the
services of the ITS, who responded by setting up an Audix
accounr ro redirect the harassing calls. A local telephone
company in Puerro Rico is conremplating a civil aerion
against the caller. We may pursue criminal charges if the
problem persists.
(.()p\righllntnl1t:l·Il1Ull
A Library conrracror reponed that an audio book that was
narrated exclusively for NLS was for sale on eBay. OIG
agenrs determined that the seller, a convicted felon, had
sold 84 of the copyright-protected items afrer convening
them ro digital audio formar. An Assistanr U.S. Anorney
declined ro prosecute. The seller was banned from selling
on eBay and NLS removed the individual from its Talking
Books program.
[alsif~.Ing Illkr.tll.l11pll" Il11111 1);11.1
The Deparrmenr of Labor (DOL) OIG alerred us to
their arrest of a Library employee for stealing credit card
information from the DOL and making unauthorized
purchases while working there as a conrracror. OIG agenrs
determined that although fired from herconrracror position
at the DOL, she had failed ro disclose the terminarion
when applying at the Library. As a resule, her Library
employmenr was terminated.
l nauth()rl/ed l Sc ()t tbe I.ihl'.ln·~ ;llll(:
The OIG received a complainr alleging unauthorized use of
the Library's name for commercial purposes and solicitation
on Library property. Our investigation determined mat
represenratives of a company that marketed retail sales
discounrs had distributed coupons to Library staff in one
of the Library's buildings. The prinr on the coupons read:
"Complimenrs of the Library of Congress." We referred
the marrer ro the Library's Office of General Counsel,
who responded by enforcing existing Library regulations
disallowing commercial vendors on Library property.
Previously, vendors had been allowed ifa sponsoring Library
organization received a percenrage of sales receipts.
., i~t:ri,ln -Ill)" I I1ICrl1Ct ~C.1111
OIG agenrs acted on a tip from an external law enforcemenr
source that an employee was communicating via Library
e-mail with foreign nationals from Nigeria and Ghana
engaged in an Inrernet fraud known as the "Nigerian 419"
scam. The scammers promised ro send the employee a
large amounr of money after he paid some related expenses,
duping the employee into sending them approximately
$30,000. The employee also provided his Social Security
number, birrh date, and home address, thus exposing him
to idenrity theft and further loss. OIG agenrs coordinated
with the Library's Inrerpretive Services staff ro refer the
employee ro an organization that would help him protect
his remaining assets, and teferred information about the
employee's misuse of governmenr time and equipmenr
to Library managemenr. Disciplinary action is pending.
OIG agenrs also referred specific infotmation about the
scam to the U.S. Secret Service.
I t1SI I 1C;\1 I< '11 1>1 TlIllL IIld \lkl1d.l11l"l [{ce. >Ills
Library managemenr officials alleged that twO employees
had engaged in lime and ;}rrendance fraud. OIG agenrs
examined tecords, security surveillance video tapes, and
SE:I.1IANNUAI Rr.l'ORT 1'0 THE CONGRfSS II
electronic access files, which revealed significant
fraud. Faced with the evidence, both subjects
admitted to falsifying time and attendance records.
An Assistant U.S. Attorney declined prosecution.
One employee retired immediately following the
OIG interview; a removal action has been proposed
against the other.
An unattended trash bin in a public area containing a
large amount ofpersonal information was discovered
by OIG staff. Social Security numbers, credit card
receipts, and personal records were visible. OIG staff
prom pdy advised the responsible manager abou t
proper methods for disposal of personal information
and management immediately tightened security
procedures. The unsecured information may have
exposed individuals to identify theft.
(omputlT I ncidcnt
An automation liaison employee working for
NLS reported a key logger (a spyware tool)
installed on a computer used to process financial
and administrative information. An OIG agent
transported the computer to the Library's Security
Operations Center where it was examined by
a Computer Incident Response Team member.
Examination determined that the key logger had
been installed without malicious intent. Members
of the Security Operations Center and the Incident
Response Team, which includes the OIG, provided
several recommendations to Library management
to prevent a recurrence.
Pnl,lCri\l Inirlltl\c: Intlrnll ~lIt"\l'ill<lncc
We continue to monitor the Internet for stolen
Library property. During this reporting period, we
found 29 NLS cassette players and/or phonographs
for sale on eBay. The sellers were contacted and
directed to return the items to NLS.
Misuse of Government Equipment
We previously reported a case involving evidence
that a GS-14 employee had illegally accessed
another employee's e-mail account and forwarded
a derogatory message from the account to another
Library employee. Management suspended the
employee for 30 days.
Employee Attempts to Destroy Library Books
We previously reported a case involving a Library
employee who had intentionally placed 23 books in
a trash bin. Management removed the employee
from his position for misconduct.
SEMI NNUAI. RJiI'ORl TO rHE CONGtu-.SS II
FOLLOW-UP ON PRlOR PERlOD RECOMMENDATIONS
Effecring positive managemenr change in Library programs
and acrivities requires a four-phase approach: (I) idenrif}ring
areas rhar could benefir from OIG reviews, rhen planning
audirs, (2) conducting audirs and reponing rhe results,
(3) obraining agreemenr from Library managers ro rake
acrion ro resolve recommendations, and (4) following up ro
derermine rhar implementarion has occurred. Significanr
recommendarions from previous semiannual repons
on which correcrive acrion has nor been complered are
conrained in Table 3 on page 14.
We conducred rhree reviews rhis period ro follow up on
audirs reponed in prior semiannual repons:
VISITOR TUNNEL PREPARATIONS
"linn Report 0.21111') 1)\-1112
.I Ullt 21'"5
In FY 2005 we conducred an audir survey of prepararions
for opening rhe runnel berween rhe Jefferson Building and
rhe Capi£Ol Visiror Center (CVC). We found rhar acriviries
requiring long lead rimes had been planned and execured ro
prepare for opening rhe runnel ro rhe public. We followed
up on rhis survey in Seprember 2006. In our follow-up we
derermined rhar all consuucrion required ro accommodare
rhe runnel had been complered.
In anriciparion of rhe increased number of visirors ro
rhe Library due co rhe opening of rhe evc, rhe Library
is embarking on a program called rhe "New Visirors'
Experience" (NVE) rhar will reconfigure space in rheJefferson
building co add and significanrly enhance exhibirs and rhe
experience of visiring rhe Library. Projecr managemenr for
rhis program is under rhe Librarian's Chief of Sraff. The
projecr will be opened in phases, wirh rhe firsr expecred co
coincide wirh rhe opening of rhe CVC in 2007.
We conducred a survey of rhe sratus of prepararions for rhe
NVE. We imerviewed rhe Chief of Staff, key personnel in
Library Services, and Inregrated Suppon Services' Faciliry
DeSign and Conmuction (FD&C). We reviewed rhe
NVE operaring plan and derermined rhar Library Services
has planned for rhe expecred relocarion of Library sraff
due ro rhe reconfigured space. We found char FD&C has
worked wirh rhe NVE ream in developing scopes of work
and conuacring wirh archirecrural and engineering design
firms. The NVE ream has developed an inrraner Web sire
as a means ofcommunicaring currenr NVE news co rhe sraff
and inrroduced rhe NVE rheme "Bringing Knowledge Inro
Life:' ro Library sraff ar a Town Hall Meering in Augusr.
Based on our survey work, we believe char rhe planning
framework esrabJished by rhe NVE ream is effecrively
addressing rhe Library's plans for rhe NVE. We will
conrinue ro follow rhe Library's progress in FY 2007.
EDUCATION AND RESEARCH
CONSORTIUM OF THE WESTERN CAROLINAS
Rcpl'rl fl. 21J1)() (>1 -~()I
f i~c.t1 'r'L;\r 2111)') Illdirect Cost R,lte
In FYs 2000 and 2002, rhe Library awarded rhe "Advenrure
of rhe American Mind" and rhe "Nonh Carolina
Telecommunicarions Projecr" grams ro ERe. Borh grams
incorporare Office of Managemenr and Budger Circular
A-133 requiremenrs. These requirements, among orhers,
mandare rhar an enriry's Federal cognizam agency is
responsible for negoriaring and approving irs indirecr cosr
rares. As rhe cognizanr agency for ERC, rhe Library is
responsible for approving indirect cost rates on behalf of all
federal agencies providing funding co ERe.
We evaluated ERe's FY 2005 indirect rate proposal and
found errors in equipmenr classification and other issues.
ERC agreed wirh our findings and revised its FY 2005
indirecr rare proposal. We negoriated a rare .36 percenr
lower than rhe revised rare.
SI"flANNUAl RI'PORI ['()IHL C r ONCR~SS II
SUCCESSION PLANNING
Audit Report o. 200'+-PA-l 05 \larcb 2005
In March 2005, we issued an audit reporr on me Library's
succession planning efforrs. Our objective was ro
determine if the Library had a srrategy ro deal with the
emerging challenges of mainraining its workforce inro the
21 St cenrury.
We found that the Library's service units (aside from the
Congressional Research Service and Copyright Office)
did not have succession plans, and had not idenrined
critical posirions ro ensure continuiry of leadership and
knowledge. Therefore, we recommended that the Library,
with Human Resources Services at the helm, prepare a
formal succession planning program. This program would
provide guidance on succession planning ro Library offices.
We also recommended that Library offices link succession
planning ro their training and srrategic plans and also
identify mission-critical positions.
So far, the Library has resolved cwoofour recommendations.
The Srrategic Planning Office (SPO) recommended that
Library offices' FY 2007 Annual Program Performance
Plan objectives focus on workforce developmenr and
succession planning, and Library offices are now linking
some componenrs of succession planning to their rraining
and strategic plans. At the same time, Library offices are in
the process of idenrifying their mission-critical positions.
Nocwithstanding progress in those areas, the Library has srill
not implemented a formal succession planning program.
The Deputy Librarian has, however, agreed ro include key
succession planning componenrs - the idenrincation of
key skills, knowledge and training needs, and leadership
competencies - in the Library's Workforce Transformation
Iniriarive. We will evaluate the effect of these acrions once
that initiative is under way.
READING ROOM UTILIZATION
\udlt Rcrort '\Jo 2003-PA-lO.+
\1arch 200.+
In March 2004, we issued an audit reporr on the utilization
of the Library's reading rooms. Library Services has 20
reading rooms/information cenrers, the Congressional
Research Service (CRS) cwo, and the Law Library one.
The objecrive ofour audit was to determine whether reading
room space is utilized in the most efficienr way possible.
We found that, in general, Library Services and the Law
Library accumulated inconsistenr and inaccutate reference
statistics. Nocwithstanding the limited usefulness of the
statistics, we found that there was evidence of a substanrial
decline in the number of in-person visits ro the Library.
We recommended that Library Services and the Law
Library obtain more accurate and useful reading room
usage data. We believe the use of a uniform sampling
methodology would improve the reliability and efficiency
of reference counrs and create greater uniformity across
reading rooms. Furrhermore, we recommended that CRS,
the Law Library, and Library Services perform structured
requiremenrs analyses to determine reading room space
requiremenrs. For many years, most of the Library's
reading rooms have been in the same physical location and
connguration, bur their space requiremenrs had not been
formally evaluated. Finally, we recommended that Library
Services develop a decision model to help make decisions
about space usage. A standardized model would help
managemenr more objectively and consistently determine
the most appropriate use of space.
Since rhen, CRS and the Law Library have implemenred
the spirit of our recommendations. Library Services has
implemenred a system to better measure reading room
usage, however, more than cwo and a half years after we
issued our reporr, the remaining recommendations ro
Library Services remain open.
SEMIANNUAL REPOI<J 10 ['HI:. CONGR.I:.SS II
UNIMPLEMENTED RECOMMENDATIONS
TABLE 3: SIGNIFICANT RECOMMENDATIONS FROM PREVIOUS SEMIANNUAL
REpORTS FOR WHICH CORRECTIVE ACTION HAs NOT BEEN COMPLETED
R Vll I I !{[ • >.
I I) II
Office of the Librarian
Dispute Resolution Center
2002-PA-I04 September 2003
Office of Workforce Diversity
III Revise LCR 2020-7 to allow complainants to use dispute resolution during the formal EEO complaint process.
Learning at the Library 2001-PA-lOS
April 2003
Operations Management and Training
LG Provide training to new supervisors. I
Equal Employment Opportunity Complaints Office
2001-PA-I04 February 2003
Office of Workforce Diversity
Evaluate and revise LCR 2010-3.1.2
Succession Planning 2004-PA-lOS March 2005
Office of the Librarian
1.1 Mandate a Library-wide succession planning program that endows Human Resources Services with a strong leadership role. 3
Office of Strategic Initiatives"
FY 2004 Financial Sta tements/ Info. Technology
2004-FN-S02 February 2005
Information Technology
Services Fully implement an entiry-wide security program.
Integrated Support Services
Inventory and Equipment Management
2004-PA-I03 March 2005
ISS 1.2 Reevaluate space needs for the future warehouse planned at Ft. Meade.
Transportation Services 200S-PA-I01 March 2006
ISS LB Document policies and procedures and centralize transportation activities.
I The Library has implemented a new training program for new supervisors. Included are online training courses and instructor-led
training. Due to budgetary constraints, the instructor-led portion has been delayed until later in FY 2007. Once fully implemented,
this program will satisfy the intent of our recommendation.
2 LCR 201 0-3.1 is currently being revised .
.1 See page 13 for a discussion of this topic.
"(a) The Library's external auditors modified and consolidated current and prior year financial statements findings into the one
finding shown here. (b) Due to the implementation of the Library's new financial system, the auditors' opinion on the Library's
FY 2005 financial statements was not released until May 2006. (c) According to ITS, substantial progress was made during FY
2005 toward implementing this recommendation. The external auditors, conducting the FY 2006 audit of the Library's financial
statements, are currently reviewing documentation supporting this assertion.
II SEM[ANNUAL RhPORT [0 fHF CONGRESS
TABLE 3: SIGNIFICANT RECOMMENDATIONS FROM PREVIOUS SEMIANNUAL
REpORTS FOR WHICH CORRECTIVE ACTION HAs NOT BEEN COMPLETED (CONTINUED)
R
I. I
(l
I) J I ~I, \ If I I Rrc. R.
Office of the Chief Financial Officer
Management 2004-PA-I06 Strategic Revise the MCP Process to better identify Control Program March, 2006 Planning Office control weaknesses.
Management Control Program
2004-PA-I06 March, 2006
Strategic Planning Office
II Implement an automated tracking system.
Management Control Program
2004-PA-l 06 March, 2006
Strategic Planning Office
III Implement a verification review process.
Management Control Program
2004-PA-I06 March,2006
Strategic Planning Office
IV Improve the MCP communications mechanism.
Management Control Program
2004-PA-I06 March,2006
Strategic Planning Office
V Report implementation delays to the Librarian.
Office of Security and Emergency Preparedness
Management of Police 2003-PA-I05 August 2004
OSEP 53,545 Develop a mission statement and engage in a greater level of strategic planning.
Emergency Preparedness Program
2005-PA-l 04 March 2006
OSEP Develop a regulation defining and designating authoriry for the Emergency Preparedness Program.
Emergency Preparedness Program
2005-PA-I04 March 2006
OSEP III Develop or obtain a threat/risk assessment.
Emergency Preparedness Program
2005-PA-I04 March 2006
OSEP VI Develop an annual training plan and provide more emergency response training.
Emergency Preparedness Program
2005-PA-l 04 March 2006
OSEP VII Improve communications and training for disabled staff and disability monitors.
Emergency Preparedness Program
2005-PA-I04 March 2006
OSEP VIII,IX Develop an MOU with the Capitol Police and the Architect of the Capitol to clarify authority for direcring emergency situarions.
Library Services6
Utilization of Reading Rooms
2003-PA-I04 March 2004
Library Services II.l Develop a decision model for determining reading room space requirements.
Utilizarion of Reading Rooms
2003-PA-I04 March 2004
Library Services IL2 Use the model ro make decisions about reading room, office space, and storage requirements.
5 Recommendation numbers refer to an external consultant's report.
6 See page 13 for a discussion of this topic.
ShMJANNUAL. REPOR'1 fO fHE CONGIU.SS II
FUNDS QUESTIONED OR PUT TO BETTER USE
TABLE 4: AUDITS WITH RECOMMENDATIONS FOR BETTER USES OF FUNDS
R In
... for which no management decision was made by the starr of the period.
.. .issued during the period.
Subrotal
... for which a management decision was made during me reporring period:
Value of recommendations agreed [Q by managemenr. 1
HII \ I I
$4,000
Value of recommendations not agreed to by management.
· .. for which no management decision was made by the end of the reporting period.
... for which no management decision was made within six months of issuance.
TABLE 5:
R
AUDITS WITH QUESTIONED COSTS
· . Jor which no management decision was made by the start of the period.
.. .issued during the period.
· .. for which a management decision was made during the reporting period:
Value of recommendations agreed ro by management.
Subrotal
Value of recommendations nor agreed ro by managemenr.
... for which no management decision was made by the end of the reporting period.
.. .for which no management decision was made within six months of issuance.
I See "Telecomunications Abuse - 800 Number" on p. 9.
SEMIANNUAl. REpORT TO THE CONGRf.SS II
INSTANCES WHERE INFORMATION OR
ASSISTANCE REQUESTS WERE REFUSED
There were no instances during the period concerning the Library's unreasonable refUsal to provide
informacion or assistance, or any other refusal from a Federal, State, or local government agency.
STATUS OF RECOMMENDATIONS
WITHOUT MANAGEMENT DECISIONS
During the reponing period there were no recommendations more than six months old without management
decisions.
SIGNIFICANT REVISED MANAGEMENT DECISIONS
During the reponing period there were no significant revised management decisions.
SIGNIFICANT MANAGEMENT DECISIONS
WITH WHICH OIG DISAGREES
During the reponing period there were no significant disagreements with management about decisions
on OIG recommendations.
II S~.MIAN UAL REPOR[ 10 IHf CONGRESS
OTHER ACTIVlTIES
NEWSLINE FINANCIAL INFORMATION
~pL'(:ul RUlc\\" Rc:p"n 11.211(1(,-[
'ul~ 21I(J()
Pursuant to a request by the Chairman of the House
Appropriations Committee (Committee), the OIG
conducted a special review of financial information about
the NEWS LINE fund of the appropriation for the NLS.
The Chairman requested an explanation for the erroneous
information that the Library reponed to the Committee
in May 2006. The information involved $993,500 that
was made available for NEWS LINE's operation through
rhe FY 2003 appropriation. The Chairman specifically
asked whether rhe NEWSLINE account was properly
established in rhe Library's previous financial system and
properly convened ro irs new sysrem. He also requesred
rhar each rransaction be identified rhar should have been
recorded in rhe account, rhe locarions be identified where
rhose rransacrions were recorded in the financial sysrem,
and rhe reason for rheir erroneous recording.
We derermined rhar:
The NEWSLINE fund was nor properly esrablished in
rhe former financial sysrem, but a correction was made
prior ro conversion to rhe new financial sysrem.
Because of rhe way rhe correction was made, some of
NEWSLINE's financial informarion was nor properly
convened ro rhe Library's new financial sysrem.
Three NEWSLINE expenditures roraling $993,500 were
incorrecdy recorded.
As a resulr of rhese errors, rhe Library correcred rhe
NEWSLINE aCCount and enhanced irs procedures for
identifYing and correcring errors in irs financial sysrem. In
spire of rhe error in rhe conversion of rhis informarion, we
confirmed rhar the resulrs COntained in rhe OIG repon,
"Financial Sysrem Conversion Reconciliarion," reponed in
our March 2006 Semiannual Repon, are valid.
CONVERSION TO DIGITAL TALKING BOOKS
~Ul'\ \ Report '.,rl. 2111!(I-P\ Ill!
\UL,U't 21111()
We performed a survey of rhe NLS projecr ro conven and
replace rhe primary rechnology used in rhe narionallibrary
program that provides talking books, playback equipment,
and Braille marerials for blind and physically handicapped
patrons. NLS' plans call for digiral books and equipment
to begin replacing analog cassette books and machines in
FY 2008 and become rhe program's primary rechnology
by FY 20 II. Based on our survey, we derermined rhar an
audir of rhe projecr is nor necessary ar rhis time.
Informarion we collecred led us to conclude rhar NLS'
plans should enable ir to successfully converr rhe talking
book program's primary rechnology from analog to digital
formar over rhe currently planned transirion period.
Specifically, our survey revealed rhar NLS is effectively
managing irs plans ro:
· develop a digiral playback machine and relared
equipment,
· tesr and validare rhe new playback machine rhroughout
irs evolurion from design to full producrion, and
· produce 20,000 talking book tides in digital formal by
the time the new playback machine becomes available in
FY 2008.
Despite NLS' progress in these areas, we are concerned
rhal an acquisirion plan has nor been prepared for rhe
manufacturing phase of rhe digiral equipment. Acquisirion
planning is a requirement of the Federal Acquisirion
Regularion (FAR) for all acquisirions made by execurive
branch agencies. Moreover, il is Library policy [Q follow
rhe FAR in rhe procurement of goods and services unless
ir is formally derermined rhar following ir is nor in rhe
Library's besr interest. The Chief of rht: Library's Office
of Contracrs acknowledged rhar acquisirion plans are
required by the FAR, bur nored rhar because rhe Direcror
SEMIANNUAL REPORT TO tHE CONGlU-.SS II
posirion is vacam for rhe Office of Conrracrs and Grams
Managemenr, FAR-specified inrernal procedures have nor
been esrablished for rhe Library ro address rhe regularion's
requiremenrs.
Ir is clearly in me Library's besr inrerest ro have a wrinen
acquisition plan for the manufacturing phase of the digiral
equipmenr, and rhe lack of inrernal procedures should nor
prevenr me Library from preparing one. By preparing
an acquisirion plan for rhis major acquisirion of digiral
equipmenr - esrimared ro cosr $140 million over five years
- rhe Library would nor only be following the FAR and its
own policy, but would also be in line with standard federal
agency practice. Therefore, we recommended that NLS
work closely wirh rhe Chief of the Office of Conrracrs
ro promprly prepare a wrinen acquisirion plan for the
manufacruring phase of the digital playback equipmenr.
ACQUISITION OF MAxIMO
P1"I'1<'" <I 21111h .1' XIII
Pn 'i~cl 1>1111 RL \ I~\\
At the request of rhe Library's Chief Financial Officer, we
performed a review of the Maximo acquisition process.
Maximo, a sofrware package rhat inregrates with rhe
Library's new financial system, was inrended ro be the
Library's choice as an invenrory- and asset-managemenr
system. We began our review in December 2005 in
response LO the Chief Financial Officer's concern rhat the
Library's pace of assessing the possibility of implemenring
Maximo was stalling.
We determined that although the Library had acquired
Maximo in 2004, ir had not yet implemenred the sofrware.
In June 2006, we advised the Deputy Librarian that the
Library had not fully analyzed and compared its asset
managemenr requiremenrs ro Maximo's capabilities.
Subsequenrly, the Library's Executive Committee decided
that the Library needed ro renew anent ion to rhe Maximo
invesrmenr, and a project was initiared at the commirtee's
direction to analyze the Library's asset-managemenr
requirements.
ANNUAL FINANCIAL STATEMENTS AUDIT
I~~r/)rt /). 2011( I I ..,0")
RL ~ILlL 'I f"f PI"< '1" >'al
In FY 2006 we senr a Request for Proposal (RFP) to five
audit firms for bids on the next five-year conrract for
financial sratemenrs audits of the Library of Congress,
James Madison National Council Fund, and the Open
World Leadership Cenrer. The RFP was completely
rewrinen from prior years based on guidance from The
Presidenr's Council on Inregrity and Efficiency and the
Executive Council on Inregrity and Efficiency.
The primary changes were in the presenrarion of a more
detailed list of deliverables for each audit, with a suggested
rime line, in order to ensure timely delivery of a quality
audir. The paymenr schedule was changed from one based
on paymenr for hours worked, to one based on sarisfactory
acceptance of deliverables. The minimum conrract
deliverables and estimated due dates were described in
derail to enable the successful bidder to amici pare rhe
conrracr requiremenrs. We expecr rhis change in srrucrure
to allow us to more closely match rhe disbursement of
funds wirh rhe receipr of deliverables and rherefore bener
monitor the contractor.
The proposals received were evaluared by the Technical
Evaluation Panel, which scored each bidding firm by three
separare, weigh red facrors including relevanr experience
and past performance, corporare resources and staff
qualificarions, and technical approach. While COSt was a
subsranrial factor, it was considered along with rhe factors
lisred above. A conrraer was awarded to the successful
bidder, pending passage of rhe FY 2007 appropriarion
bill.
Sf.M1ANNUAI RFPOKI TO fHE CONGRESS II
REVIEW OF LEGISLATION AND REGULATIONS
TABLE 6: REVIEW OF LIBRARY OF CONGRESS REGULATIONS
II R R
LCR 1811 Employee Identification Cards
LCR 2013 Pay Administration
LCR 2010-7 Employment of Non-U.S. Cirizens Using Appropriared and Non-Appropriared Funds
(. , ,'I I I II () I" II I' 'I I (R I,
The Office of Security and Emergency Preparedness is proposing [Q updare the regulation on employee identificarion cards. We recommended against issuing the proposed draft because it did not vesr the Office of Security and Emergency Preparedness with enough authority to prorect the integrity of the badging function.
Human Resources Services is proposing [Q replace 30 regulations on pay administration with one comprehensive policy. We suggested adopting language contained in the Government Accoumability Office's pay administration policy [Q explain which federal statutes rhe Library musr follow. Additionally, we suggesred insening hyperlinks to federal pay regulations posred on rhe Federal Regisrer's Web sire.
We had no comments on rhis proposed regularion.
SEMIAN UAL RI:.I'ORT ro THE CONGRESS II
INSPECTOR GENERAL HOT INE
Help Promote Integrity, Economy, and Efficiency
Report Suspected Fraud, Waste, Abuse, or Mismanagement
Complaints May be Made Anonymously
Inspector Genera I
Library of Congress
101 Independence Avenue, S.E.
LM-630
Washington, DC 20540-1060
Main Telephone Number: (202) 707-6314
Fax Number: (202) 707-6032
Hotline Telephone Number: (202) 707-6306
Hotline E-mail: [email protected]
Any information you provide will be held in confidence.
However, providing your name and a means of communicating
with you may enhance our ability to investigate.