GAO Finds Internal Controls at IRS's Exempt Org Unit Wanting
"There are several areas where EO’s control system could be strengthened, as noted by the control deficiencies identified in this report. Many of these deficiencies pose a risk that could lead to returns being selected, or not selected, for examination based on criteria or practices that fall short of TE/GE’s mission of ensuring fairness and integrity. For example, internal controls monitoring is one way to help reduce risk, but
without consistent monitoring, there is the possibility returns could be selected for unfair reasons," said the GAO in its conclusion.
The GAO recommended several improvements to internal control design and implementation, such as a system of annual reviews to make sure procedures are accurate and up to date, install monitoring procedures to ensure already existing case selection controls are being followed, and working to ensure the referral committee membership rotates as it should.
The IRS, in its response, agreed on the importance of internal controls, and said that the Exempt Organizations unit will continue to review and improve its efforts to effectively oversee the sector.
The GAO recommended several improvements to internal control design and implementation, such as a system of annual reviews to make sure procedures are accurate and up to date, install monitoring procedures to ensure already existing case selection controls are being followed, and working to ensure the referral committee membership rotates as it should.
The IRS, in its response, agreed on the importance of internal controls, and said that the Exempt Organizations unit will continue to review and improve its efforts to effectively oversee the sector.