The document provides an update on the activities and focus areas of the National Science Foundation (NSF) Office of Inspector General (OIG) as of February 2018, detailing changes in audit practices, ongoing and planned audits, significant findings, and outcomes of recent investigative actions. The OIG has shifted its audit process to concentrate more on risk areas, increasing both the number and depth of external audits, and enhancing its own direct involvement. Audit selection is driven primarily by risk assessment and resource availability, with a significant portion of audit work being OIG-initiated. Current external audits encompass higher education institutions, non-profit organizations, and large facilities, highlighting common issues such as unsubstantiated allocability of costs, improper application of indirect cost rates, and the inappropriate charging of direct costs.
The document also covers internal audits focused on subrecipient monitoring and the NSF’s internal controls regarding the allocation of funds for major facilities. Communication with awardees during audits follows a structured process allowing for feedback and formal resolution. Recent OIG reports reveal persistent challenges, such as gaps in responsible conduct of research training, and issues with conflict of interest procedures relating to IPA assignments. Investigative outcomes have included significant financial recoveries, disciplinary actions, and the implementation of compliance plans where fraud or improper expense documentation was identified. The OIG stresses the importance of reporting potential fraud or misconduct and assures protections for whistleblowers. Multiple channels are provided for confidential reporting, and recent improvements have been made to ensure the security of these communications. Overall, the update underscores the OIG’s proactive approach in ensuring accountability, regulatory compliance, and the responsible stewardship of NSF funds.
