Auditing Communications Act, Accounting, & NFFS Requirements O ffice of I nspector G eneral PMBA Presentation May 2016
Background Station audits routinely identify non-compliance issues with Communications Act, accounting, & Non-Federal Financial Support (NFFS) reporting requirements. Findings include : • Inadequate advance notice of public meetings; • Financial records not available for public inspection; • Community Advisory Board issues; • EEO (Employment Statistical Report) not available to public; • Lack of discrete accounting for CSG funds; and • Over-reporting NFFS.
Auditing Communications Act Requirements Audit Criteria - Certification Requirements for Station Grant Recipients • open meetings; • open financial records; • Community Advisory Board (CAB); • EEO information (employment statistics); and • donor lists and political activities.
Advance Notice of Public Meetings • Meetings announced but not by a method specified in CPB guidance (e.g., posted at station offices, station magazine, or announced on-air) • Meetings announced but less than 7 days • Meetings not announced • Meetings not open to public
Financial Records Not Available to the Public • CPB Annual Financial Report (AFR) • financial statement audit report • other CPB grant financial reports • or any combination of these reports
CAB Not Operating • CAB established but did not hold meetings • CAB not established • CAB discontinued during audit period • Group formed for other purposes but had some responsibilities similar to a CAB
EEO Information • FCC EEO information available at station • CPB SAS Employment Statistical Report not available to public
Annual Certification of Compliance with General Provisions CPB’s Radio & Television Community Service Grant Legal Agreement : – Requires grantees to certify its compliance with grant General Provisions and Eligibility Criteria annually to receive a new grant. – A station’s compliance is subject to audit by the Inspector General, and improper certifications may result in penalties under the Federal False Claims Act. – Grantee represents and warrants: “That Applicant recognizes any false information provided may subject Applicant to penalties under the Federal False Claims Act, 31 U.S.C. §3729-3733.”
Documenting Compliance • Open Meetings – 7 days advance notice of meetings of governing board, committees of the board, and the Community Advisory Board. • Web posting announcement of public meetings (retain hard copy or electronic copy of screen shot of announcement with date posted to web to evidence 7 days advance notice). – Copy of open meeting minutes to evidence quorum & deliberations. – Closed meeting notice requirement. • Written explanation of why meeting was closed citing reasons allowed under the Act for closing a specific meeting.
Documenting Compliance • Open financial records – Audited financial statements. – AFR or Financial Summary Report (FSR). • CAB – Meetings were held and a quorum was present. – Right to review programming, services, and significant policy decisions. – Advised governing board whether programming was meeting the specialized educational and cultural needs of the communities.
Documenting Compliance • EEO Information – Make available the employment portion of the annual Station Activity Survey (SAS), Employment Statistical Report. – EEO information must be made available to the public at every station location with six or more employees. • Donor List – Station practice (controls) for not sharing member or donors names with political parties. – Station practice (controls) for sharing membership or donors names with any nonaffiliated third parties.
Documenting Compli ance • Donor Lists (continued) – Opt-out practices (controls) if station shares information, did the station: • Disclose to members/donors beforehand that personal information may be shared and give members/donors the option not to have their personal information shared? • Periodically remind members/donors that personal information may be shared and they have the option not to continue to share this information?
Auditing Accounting Requirements Audit Criteria: CSG General Provisions & Eligibility Criteria requires discrete accounting of CPB revenues & expenditures. Discrete accounting requires a unique code that identifies CPB • revenues & expenses (restricted & unrestricted), so grantor & auditor can discretely track those funds in accounting system. No requirement to segregate CSG funds in separate bank • accounts. Co-mingling is allowable as long as accounting system can • easily identify transactions associated with CSG grant.
Auditing NFFS Requirements Audit Criteria: CPB Financial Reporting Guidelines address reporting NFFS on the Annual Financial Report (AFR) or Financial Summary Report (FSR) Contributions vs. payments, • NFFS criteria (i.e., recipient, form, source, purpose), • Federal funds, • Revenues that do not qualify due to policy restrictions, • Restrictions on TV digital capital investments, • Underwriting, • In-kind contributions, and • Indirect administrative support. •
NFFS Compliance • In-kind Contributions – no evidence that goods and services were received from donor & some types of trades are excluded because of policy restrictions • Exchange Transactions – payments in exchange for services provided by public broadcasting (source & purpose) • Federal or Public Broadcasting Revenues – unallowable source of revenues
NFFS Compliance Other exceptions to NFFS criteria: • Auction/Special fundraising cost offset • TV digital capital investments • Institutional indirect administrative support • Uncollectible underwriting • Presenting fees
OIG Contact Information • Bill Richardson, Deputy Inspector General brichardson@cpb.org, (202) 879-9661 • OIG Office: (202) 879-9669 • OIG Hotline: (202) 879-9728 or (800) 599-2170, (202) 879- 9699 (fax), http://www.cpb.org/oig/contact.php online complaint form • OIG Email: oigemail@cpb.org
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