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Fiscal Year 2013 Performance and Accountability Report

Inspector General's Statement

Summary of Significant Management Challenges

Three of the most significant management challenges facing the U.S. Equal Employment Opportunity Commission (EEOC) in FY 2014 are in strategic performance management, reduction of the private-sector charge inventory, and strategic management of human capital.

Strategic Performance Management

In FY 2012, the EEOC finalized its 2012-2016 Strategic Plan, which contains three strategic objectives. In FY 2013, the EEOC adopted both a Strategic Enforcement Plan and continued developing a Quality Control Plan for Investigations and Conciliations in pursuit of achieving its objective to: "Combat employment discrimination through strategic law enforcement." However, in light of its financial and human resource limitations, the EEOC will be challenged in its efforts to sustain continuous progress in achieving this objective, while pursuing efforts to address the remaining objectives to: 1) Prevent employment discrimination through education and outreach; and 2) Deliver excellent and consistent service through a skilled and diverse workforce and effective systems.

In September 2012, the OIG commissioned an evaluation of the strategic plan's performance measures (Evaluation of EEOC's Performance Measures, 2012-10-PMEV). Noteworthy areas of the evaluation included whether: 1) There are performance measures for its key strategic goals and objectives; 2) The measures are effective gauges of the agency's progress in achieving its strategic goals and objectives; and 3) The performance measures are objective, understandable (to all stakeholders), and outcome-based. In March 2013, the OIG issued its report, which concluded, in part, that "the current measures do not cover the nation's progress towards achieving the [EEOC's] overarching goal: to reduce employment discrimination in the United States." The report also concluded that these measures were not outcome-based.

In our view, the EEOC can meet this challenge by adopting outcome measures for each of EEOC's three strategic objectives and track progress towards reducing employment discrimination in the United States. Developing and tracking such measures may be daunting, but worth the investment so that EEOC can continually pursue the highest and best use of its resources in reducing employment discrimination.

Reduction of the Private-Sector Charge Inventory

The EEOC again faces a major challenge in attacking the pending inventory of the private-sector discrimination charges, while improving the quality of charge processing. After reducing the inventory an aggregate 18.6 percent in FY 2011-2012, the inventory increased by less than one percent in FY 2013. At the end of FY 2013, the inventory stood at 70,781.

It is axiomatic that any substantial and sustainable effort to significantly reduce the charge inventory requires adequate numbers of staff (investigators in particular). However, in FY 2013, the EEOC's total workforce dropped from 2,346 to 2,147, a decline of 199 (8.5%). Indeed, the investigative staff, the primary staff responsible for handling private sector charges of discrimination, decreased from 726 to 656, a decline of 70 (9.6%). The combination of these net staff reductions and the impact of the FY 2013 furloughs resulting from the affects of the Budget Control Act of 2011 (i.e., BCA or sequestration), undoubtedly contributed to the EEOC's inability to sustain significant charge inventory reductions in FY 2013. If these conditions continue in FY 2014, and beyond, the EEOC will be faced with major challenges in managing this critical component of its operations.

A recent EEOC study concluded, in part, that it needs to improve its knowledge management to better administer its primary charge data system (i.e., IMS). The OIG completed an evaluation (Review of Evaluations, 2012-09-REV) in FY 2013, which was designed to provide EEOC with recommendations to improve the efficiency and effectiveness of private sector enforcement activities. Among its findings, the evaluation concludes that EEOC should undertake efforts to continue to review and assess its management of the IMS to ensure that information obtained from charging parties is essential, complete, and more effectively stored. In our view, this would enable the EEOC to leverage its existing technology to provide internal and external stakeholders with more accurate and complete data.

In addition, as noted under above, in FY 2014, the EEOC needs to successfully implement the Strategic Enforcement and Quality Control Plans. If both are successfully implemented, it could bring about more effective and efficient charge processing, which should result in a significant improvement in reducing the discrimination charge inventory.

Strategic Management of Human Capital Management

Without a high-caliber workforce, the EEOC cannot accomplish its work effectively or efficiently. A continuation of Sequestration and other factors will challenge the EEOC in developing its workforce in FY 2014. The EEOC's management must be creative and conscientious in maintaining morale, and improving recruitment and retention in light of pay freezes and other fiscal impediments that affect its management of human capital.

The EEOC also needs to act promptly on recommendations in the recent OPM review of the EEOC's Office of Human Resource's strategic and other activities. Two key actions for the EEOC to consider as high priorities are: 1) The development of an accountability system for managing Human Capital; and 2) Conducting a competency gap analysis of mission-critical occupations so that staff recruitment is based on data-driven needs.

Office of the Inspector General to the Chair

December 11, 2013

MEMORANDUM

TO: Jacqueline A. Berrien, Chair

FROM: Milton A. Mayo, Jr., Inspector General

SUBJECT: FY 2013 Agency Compliance with the Federal Managers' Financial Integrity Act(OIG Report No. 2013-07-AIC)

The Federal Managers' Financial Integrity Act (FMFIA), P.L. 97-255, as well as the Office of Management and Budget's (OMB) Circular A-123, Management Accountability and Control, establish specific requirements for management controls. Each agency head must establish controls to reasonably ensure that: (1) obligations and costs are in compliance with applicable laws; (2) funds, property and other assets are safeguarded against waste, loss, unauthorized use, or misappropriation; and (3) revenues and expenditures applicable to agency operations are properly recorded and accounted for in order to permit the preparation of reliable financial and statistical reports, as well as to maintain accountability over the assets. FMFIA further requires each executive agency head, on the basis of an evaluation conducted in accordance with applicable guidelines, to prepare and submit a signed statement to the President disclosing that agency's system of internal accounting and administrative control fully comply with requirements established in FMFIA.

EEOC Order 195.001, Internal Control Systems requires the Office of Inspector General (OIG) to annually provide a written advisory to the Chair on whether the management control evaluation process complied with OMB guidelines. On November 29, 2013, the Office of Research, Information and Planning (ORIP) submitted EEOC's Fiscal Year 2013 FMFIA Assurance Statement to the Chair and to the OIG for review. The OIG reviewed: (1) assurance statements submitted by headquarters and district directors attesting that their systems of management accountability and control were effective and that resources under their control were used consistent with the agency's mission and complied with FMFIA; (2) all functional area summary tables, and functional area reports; and (3) ORIP's Fiscal year 2013 Federal Managers' Financial Integrity Act Assurance Statement, and Assurance Statement Letter, and attachments. Based on our limited independent assessment of this year's process, OIG is pleased to advise you that the Agency's management control evaluation was conducted in accordance with OMB and FMFIA regulations.

Further, based on the results of audits, evaluations, and investigations conducted by OIG during Fiscal Year 2013, OIG concurs with ORIP's assertion that the Agency had no material weaknesses during this reporting cycle.

OIG concurs with ORIP's reporting of 8 instances of financial non-conformances. Of the 8 financial non-conformances, corrective action plans have been implemented to resolve them in FY 2014.