Reps. Stupak, Terry, Colleagues Offer Solutions for Improving FCC Audit Process

Dozens of Congressional reps call process burdensome, inefficient

October 6, 2008, Arlington, Va. - In a letter to FCC chairman Kevin Martin, 46 members of the House of Representatives expressed concern over the way universal service audits are currently being conducted by the Universal Service Administrative Company at the direction of the FCC's Office of the Inspector General. To help improve the process, they also offered solutions for easing the unnecessary burden and costs on the universal service program, rural communications carriers and ultimately rural consumers.

Noting that the audits are useful in ensuring the integrity of the universal service program, the representatives stressed their concern is with the audit process, not the audits themselves.

"We do not question the need for audits," the letter said. "In fact, our local telecom providers are confident that their compliance with federal rules is exemplary."

The letter's signatories state they've heard many examples from their constituents about how the audit process seems inefficient and unduly burdensome. They outlined several problems with the current auditing practices and offered solutions for addressing each issue, including:

  • The extraordinary amount of documents and data that are demanded of audited companies over unreasonably short timeframes (usually 10 days). Small companies typically have fewer than 10 employees [say] a turn around window of 30 days them produce the records and detail the auditors seek.

  • Inexperienced contract auditors.lacking basic knowledge of the industry and the USF program.a lack of commitment on the part of [those] auditors to spend adequate time in the field to work on areas of misunderstanding rather than through multiple e-mails and phone calls that wastes the time of everyone involved. The OIG should [ensure] auditors are trained properly. which will yield more accurate audit reports and less cost.

  • The failure to employ a reasonable level of materiality in identifying and noting potential erroneous payments. The auditors need to have de minimis defaults in place under which plus or minus errors are simply statistically insignificant. To help identify the degree in which real fraud and abuse is taking place there should be a difference of "failing" an audit for a hundred dollars and "failing" an audit for several thousands of dollars. Contact Caitlin Colligan at 703-351-2086

View letter


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