Posts Tagged ‘audit letters’

What to Expect in a GAO Audit

Wednesday, January 5th, 2011 by Brittany

January marks the beginning of the new year, and the beginning of the sending out of audit letters by the Government Accountability Office. Below are some tips that organizations should keep in mind if they happen to receive an audit letter.

The GAO sought documentation for the following information on the LD-2 reports:

  • Lobbying income/expenses
  • Specific issues worked on and the lobbyists working on those issues
  • Disclosure of “active participants” in lobbying activities of a coalition or association
  • Disclosure of foreign organizations with a financial stake in an organization
  • Lobbyists who are no longer affiliated with client/issue
  • The congressional house or executive branch agency lobbied on each issue
  • Disclosure of “prior government service” for individual lobbyists listed on the reports

It is imperative to provide additional evidence to show how the numbers, names and other information contained in the reports were collected and that the correct information was submitted.

In addition to the previously mentioned findings of the GAO, the report also mentions some of the bad habits that were reflected on the LD-2 reports. Some of the reports contained dollar amounts that were not correctly rounded to the right number. An example of this would be that if an association spent $23,000 on lobbying activities during a reporting period, instead of reporting that $20,000 was allocated to lobbying expenditures by rounding to the nearest $10,000, as required by the LDA, the association may have rounded up to $30,000 and report that figure on the LD-2.

Another common mistake seen by the GAO was reporting the same people and lobbying figures on their reports for consecutive quarters, even if the information had changed. A related problem that the GAO discovered is that organizations would “over-report” the lobbying figures and the lobbyists working on issues to cover all of their bases. Although the GAO accepted verbal explanations for these, written documentations of these decisions should be kept in the future.

With these possible inconsistencies in mind, it would be mindful to keep accurate records of the items reported on the LD-2. The following are some methods to ensure that lobbying activities are correctly reported:

  1. Explain the decision process for what will be reported.
  2. Standardize the review process for the information in the reports.
  3. Keep any documents related to any of the lobbying reports.

For more information or to purchase the Lobbying Compliance Handbook click here.