WPCz 2BJZ Courier3|sBx6X@`7X@HP LaserJet 4 on LPT2:HPLAS4.PRS 4x  @\9EX@2 6 ZF v3|sHP LaserJet 4 on LPT2:HPLAS4.PRS 4x  @\9EX@a8DocumentgDocument Style StyleXX` `  ` 2=pRkk-a4DocumentgDocument Style Style . a6DocumentgDocument Style Style GX  a5DocumentgDocument Style Style }X(# a2DocumentgDocument Style Style<o   ?  A.  2votY a7DocumentgDocument Style StyleyXX` ` (#` BibliogrphyBibliography:X (# a1Right ParRight-Aligned Paragraph Numbers:`S@ I.  X(# a2Right ParRight-Aligned Paragraph Numbers C @` A. ` ` (#` 2  o  a3DocumentgDocument Style Style B b  ?  1.  a3Right ParRight-Aligned Paragraph Numbers L! ` ` @P 1. ` `  (# a4Right ParRight-Aligned Paragraph Numbers Uj` `  @ a. ` (# a5Right ParRight-Aligned Paragraph Numbers _o` `  @h(1)  hh#(#h 2   Y 2 a6Right ParRight-Aligned Paragraph Numbersh` `  hh#@$(a) hh#((# a7Right ParRight-Aligned Paragraph NumberspfJ` `  hh#(@*i) (h-(# a8Right ParRight-Aligned Paragraph NumbersyW"3!` `  hh#(-@p/a) -pp2(#p a1DocumentgDocument Style StyleXqq   l ^) I. ׃  2i+0 [[Doc InitInitialize Document Style  0*0*  I. A. 1. a.(1)(a) i) a) I. 1. A. a.(1)(a) i) a)DocumentgTech InitInitialize Technical Style. k I. A. 1. a.(1)(a) i) a) 1 .1 .1 .1 .1 .1 .1 .1 Technicala5TechnicalTechnical Document Style)WD (1) . a6TechnicalTechnical Document Style)D (a) . 2XIa2TechnicalTechnical Document Style<6  ?  A.   a3TechnicalTechnical Document Style9Wg  2  1.   a4TechnicalTechnical Document Style8bv{ 2  a.   a1TechnicalTechnical Document StyleF!<  ?  I.   2ea7TechnicalTechnical Document Style(@D i) . a8TechnicalTechnical Document Style(D a) . PleadingHeader for numbered pleading paperP@n   $] X X` hp x (#%'0*,.8135@8:R>CxxxxxxxxxxCCjݭR[ӭ⭭RCRnxRjxjxjRxxCCxCxxxxR[Cxxxxjs0sR>nRRR>RRRRRRRRxCjjjjjӜjjjjjRCRCRCRCxxxxxxxxxxjxvxxxxjjjjjjjjjjxxxxxRCRxRRRxxC`RRCxxxxxӭRRR[[[eCnxxxxxx⭭jjjxRx[Rx>xxP+PWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNVVnxRjxxxxxCMxHMxHRRjjxRRxx듶VVȆRjxH"x𐋂x됐x",^Wf,fffNfNTffr,fTfffTfTrfxBxfNfffNfffffffT,oToToToTrTrrfrTfxT)rrrf,frfNdQdWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNllf ZfZfZff,gg,,,l,l,f,Z",,,&,2\zt1hl l!KxFZ",^WrfffNfNTffrfTfffTTTrrTrfBffNfffNfffffffTrTrTrTrTrTrrfrTfrTrrrrrrTrrrfrfNdTdWddddddddddddddddddddddddddddddddddddddddNllr NZZfZff,gg,,,l,l,f,Z",,,&,<?xxx,2x6X@`7X@ <[*PPP,MP6X@`7@<r5ddd,Oed6X@`7@s4ddd,鑡d `7 r5ddd,d6Nhez7H4 s4ddd,$;dhM7 [*PPP,nMP6Nhez7H4 [*PPP,$¹MPhM7 ?xxx,Mx6Nhez7XH 4 ?xxx,$BlxhM7X?xxx,)x `7XO;sH?,8hs\  P6G;P P;wH?,Hيw4  pG;\S9qH?,]Pq*f9 xr G;XQ;sH?,teފs9 xOG;cYl^,8\  P6G;P\]Vl^,]ͱ*f9 xr G;XRXl^,t519 xOG;^GWK,8 \  P6G; P\_EWK,]" *f9 xr G; X`GWK,t 9 xOG; aGWK,Hķ 4  pG; bYl^,H4  pG;7jC:,8Xj\  P6G;XP #mt,8\  P6G;P\'it,]:K*f9 xr G;X\5hC:,]Xh*f9 xr G;XXRdW,8R\  P6G;P\OdW,]}*f9 xr G;X7nC:,H4Xn4  pG;XRdW,HDc4  pG;QdW,t9 xOG;APF,8/\  P6G;P!\?}PF,]=}*f9 xr G;X"i~'^FRexxʻRRRx>R>CxxxxxxxxxxRRxݕRjʞxʕ[C[exRxxjxjCxxCCjCxxxx[[Cxjjj[`C`R>eRRR>RRRRRRxRxCxxxxxӞjjjjjRCRCRCRCxxxxxxxxxjxxxxjxxxxxjjjjjjjxxxxxRCRxRRRxxjCVRMCxxxxx➕[[[x[x[x[VCexxxxxxʞ[[[xRxx[Rx>xxP5PWddddddddddddddddddddddddddddddddddddddddNVV}x[xxxxxxCMxHMxHRRxRRxx듶VVxxRxH"x𐋂x됐x2z ?<Lo s4-#MP6X@`7@##d6X@`7Oe@# S#MP6X@`7@#EMIANNUAL #d6X@`7Oe@#R#MP6X@`7@#EPORT OF THE #d6X@`7Oe@#I#MP6X@`7@#NSPECTOR #d6X@`7Oe@#G#MP6X@`7@#ENERAL #d6X@`7Oe@#F#MP6X@`7@#EDERAL #d6X@`7Oe@#C#MP6X@`7@#OMMUNICATIONS #d6X@`7Oe@#C#MP6X@`7@#O#MP6X@`7@#MMISSION#x6X@`72X@#  ?< LouS_________________________________________________________________  s4-#d6X@`7Oe@# April 1, 1996 September 30, 1996#MP6X@`7@#` (#(#d6X@`7Oe@#P#MP6X@`7@#AGE #d6X@`7Oe@##x6X@`72X@# ă #s\  P6G; hP#  y,K TABLE OF CONTENTS   \.-   \(-     \-I.x` ` INTRODUCTIONp,"(#I 2  \-II.x` ` AUDITSp,"(#I 5  \ -III.x x` ` INVESTIGATIONSp,"(#I 9  \ -IV.x` ` MANAGEMENT AND ADMINISTRATION. . . . . . . . . . . . . . . . . . 12  \ -V.x` ` SPECIFIC REPORTING REQUIREMENTS OF SECTION 5(a) x` ` OF THE INSPECTOR GENERAL ACTpP"(#J14 ATTACHMENTS  \-A.x` ` TABLE I: OIG AUDIT REPORTS WITH QUESTIONED COSTSp"(#F 17  \-B.x` ` TABLE II: OIG AUDIT REPORTS WITH RECOMMENDATIONS  \-x ` ` THAT FUNDS BE PUT TO BETTER USEp"(#F 18 "0*%%"  y,K INTRODUCTION   \`- lx   \Z-  xz# s\  P6G; hP#The Federal Communications Commission (FCC) is an independent regulatory agency  xexercising authority delegated to it by Congress under the Communications Act of 1934  xAas amended. The FCC is charged with regulating interstate and international  x/communications by radio, television, wire, satellite and cable. The FCC's jurisdiction  xcovers the fifty states, the District of Columbia, and U.S. possessions. The mandate of  xthe FCC under the Communications Act is to make available to all people of the United  x-States a rapid, efficient, nationwide, and worldwide wire and radio communication service. The FCC performs four major functions to fulfill this charge: x spectrum allocation; x creating rules to promote fair competition and protect consumers where x required by market conditions; x authorization of service; and x enforcement.  x.The FCC was authorized 2,145 fulltime equivalent employees (FTEs) for FY 1996, this  xincluded 40 FTEs to support the implementation of the Telecommunications Act of 1996.  \- xzAs of September 30, 1996, the FCC actually used 2,046 FTEs. The majority of FCC  xemployees are located in Washington, DC. FCC field offices are located throughout the United States.  x[The Chairman and four Commissioners are appointed by the President and confirmed by  xthe Senate. Reed E. Hundt has been the Chairman of the FCC since November 1993. As  x>of the time of this report, the FCC has three sitting Commissioners; James H. Quello,  xRachelle B. Chong, and Susan P. Ness. The fourth Commission seat has not been filled  \- x.since former Commissioner Andrew C. Barrett left the Commission effective March 30, 1996.  x.On February 8, 1996, President Clinton signed into law the Telecommunications Act of  x1996, (Pub. L. No. 104104). This signing of this Act represented the first major overhaul  xof telecommunication law in almost 62 years. The Act is geared towards promoting  xcompetition, reducing regulation, and encouraging the rapid development of new  xMtechnologies. The Act also includes a provision calling for the installation of a Vchip  x\in every new television. Over the six months covered by this report, the Commission"$0*%%F#"  xworked in an aggressive manner to develop the rules necessary to implement this new law.  x.In testimony to the House of Representatives on July 18, 1996, the Chairman stated that  xthe Commission had either met or beat the 29 statutory deadlines imposed on the FCC by the Act. In concluding his testimony the Chairman stated: xThe Telecommunications Act of 1996 creates a mechanism, whether xthrough agreement or through arbitration, for connecting complex xtelecommunications networks plug to plug. As we work to write xrules implementing the Act's local competition and other provisions, xwe will continue to be flexible, creative, reasonable, and open. We xwill also continue to work with our state and local colleagues, the xindustry, consumers, and this Subcommittee to fulfill the Act's xpromise of open and competitive markets and the benefits of xcommunications for all Americans.  x[As identified in our previous semiannual report, the Chairman had proposed a field office  x=restructuring plan that would result in the closure of nine attended frequency monitoring  x"stations and three additional monitoring sites located at FCC field offices. This  xstreamlining initiative has been implemented during this reporting period. In place of  xthese previously manned stations, a national automated monitoring network has been  xestablished and will be controlled from an existing facility in Columbia, Maryland.  xAdditionally, the planned closure of nine of the 25 existing field offices as well as three  xof the six regional offices has been effected. Two technical staff members continue to be  xlassigned as resident agents in the nine locations in which field offices were closed.  xOverall, authorized staffing within the effected Bureau, the Compliance & Information  xBureau (CIB), will decrease by about onethird, from 384 to 254 positions as a result of  x[the restructuring of field operations. The plan was reviewed and approved by the House and Senate Appropriations Committees prior to implementation.  xAs a component of the reorganization, which is projected to result in annual savings of  x[eight million dollars, the Commission opened on a regional basis, the National Call Center  x(NCC) housed in the existing FCC facility located in Gettysburg, Pennsylvania. The  xNCC, when fully operational later this year, will serve as the Commission's nationwide  x?contact point for those parties seeking information about the FCC and all facets of  xNCommission operations. The overall goal of this clearinghouse operation is for the  x=Commission to better serve the needs of the public in an economical and efficient mode.  xNormal hours of NCC operation are Monday through Friday 8:00am to 4:30pm EST. The  xNCC can be reached toll free by calling 1888CALL FCC (18882255322). Initial""$0*%%""  xfeedback received by the OIG from the Chief, Compliance and Information Bureau is that the system is operating in a manner beyond preimplementation projections.  xThe Commission continues to auction spectrum as authorized by the U.S. Congress in the  xOmnibus Budget Reconciliation Act of 1993. On April 5, 1996, the Commission  xjannounced that "the FCC has reached the $20 billion mark in total auction revenues to be  xdeposited with the U.S. Treasury." As of the date of this semiannual report, the revenues  x>had risen to over $22 billion dollars. This figure can be equated to $11 million dollars per FCC employee, or $87 dollars per U.S. citizen.  xMThe Office of Inspector General has dedicated itself to assisting the Commission as it  x/continues to improve its efficiency and effectiveness. The Inspector General reports  xdirectly to the Chairman. The OIG is located in Room 752 in the FCC headquarters  x[building at 1919 M Street, N.W., Washington, D.C. 20554. The office is staffed by the  xInspector General, Mr. H. Walker Feaster III and six staff members. Mr. Paul Brachfeld  xycontinues to serve as the Director of Audits. On May 28, 1996, Mr. Edward W. Hosken  xJr. assumed the dual post of Counsel to the Inspector General and Director of  x{Investigations. Mr. Hosken came to the FCC from the Committee on Standards of  xOfficial Conduct, U.S. House of Representatives, where he was counsel since 1990. Prior  xto his work with the House Ethics Committee, Mr. Hosken spent twentyfour years in the  xkNavy Judge Advocate General's Corps, including three years with the Navy Inspector  xGeneral, retiring as a Captain in 1990. He holds a B.A. in Political Science from St. Louis University and a J.D. from Wayne State University.  x=This report includes the major accomplishments and general activities of the OIG during  xthe period April 1, 1996, through September 30, 1996, in accordance with Section 5 of the Inspector General Act of 1978, as amended 5 U.S.C. App. 3,  5.  yR,K "R0*%%0w" AUDITS  y,K   \2-  h,K OVERVIEW   xOne Special Review Report and three Audit Reports were issued by the Inspector General  \E- x.during this reporting period. On August 1, 1996, the OIG issued the Special Review of  \? - x.Auction Site Information Technology (IT) Security (OIG 966). The report reflects the  x.ongoing efforts of the OIG to support the conduct of successful spectrum auctions and  xencourage the development and implementation of strong controls over information  \- - xtechnology within the Commission. On August 14, 1996, the OIG issued the Report on  \' - xLthe Audit of Employee Use of American Express Government Credit Cards (OIG 963).  xThis audit was undertaken in response to a request from the Chairman, House Committee  xon Government Reform and Oversight. One day later, on August 15, 1996, the OIG  \- xyissued the Report on Cellular Telephone Utilization (OIG 962). On September 30, 1996,  \- xthe OIG issued its first contract audit report entitled Report on Audit of Proposal for  \ - xInitial Pricing Under RFP No. 9637 (OIG 9611). This audit of a contract proposal  xkresulted in the OIG questioning approximately $1.78 million of a proposed contract of $7.71 million for computer support services.  xDuring this reporting period, OIG auditors also continued to provide significant input  x.towards the successful discharge of investigative case activity which resided within this  xLoffice. Audit staff is working as a part of a multidisciplinary team with the Director of Investigations towards addressing potential criminal and ethical violations of the law.  \- x  The   auditors continued to serve as a reference tool for agency personnel in a myriad of  xLareas to include: financial operations; security and integrity over automated systems; and matters pertaining to ethics and potential ethical violations.  x"Audit reports can generally be obtained via the internet at the following address  xMwww.fcc.gov. However, special review and audit reports which contain sensitive or  xproprietary information will be restricted to specific individuals and organizations with a need to know. "$0*%%#"Ԍ  Z-x` `  SIGNIFICANT AUDIT ACTIVITY  \-1.XxSpecial Review of Auction Site Information Technology (IT) Security (OIG 966)(# x xThe report was issued August 1, 1996  xAs part of the OIG's effort to ensure both the protection of the Commission's information  xresources and the integrity of the spectrum auction program, the OIG performed audit  x/work at the auction site located at 2 Massachusetts Avenue in Washington, DC. The  xoverall objective was to assess security on the various information technology systems supporting the Commission's auction process.  xIn general, results of audit fieldwork indicated that an acceptable security posture had been  x?established across the various hardware platforms supporting the auction process.  xlHowever, a number of weaknesses were identified. Those weaknesses which we  xjdetermined to be critical in nature were directed to responsible personnel during the audit engagement and corrective measures were instituted prior to final report issuance.  xIn FY 1997 the OIG will perform additional security reviews over the Commission's  x-information resources. It should be noted that management has continued to be supportive  xof audit activity in this area and has reacted aggressively to address audit findings as identified by the OIG.  \^-  "2. xReport on the Audit of Employee Use of American Express Government Credit  \X-xCards (OIG 963) xThe report was issued August 14, 1996  \F-  \@- x  In response to a request to the Chairman from William F. Clinger Jr., Chairman House  xCommittee on Government Reform and Oversight, dated February 6, 1996, the OIG  xconducted an audit of Commission employee use of American Express Government credit cards.  xSpecific objectives of the audit included: (1) determining if Commission employees were""$0*%%""  xusing the account for personal purposes; (2) examining the controls in place to manage  xthe account; (3) determining if management controls were identifying inappropriate  xcharges made to the account; and (4) examining the steps taken to discipline employees who were using the account for personal purposes.  xThe auditors identified that although there was no evidence of adverse financial impact  xto the Commission, a significant number of charges made to the American Express  x.Government account by a small number of employees were not related to official travel.  xFor example, there were instances where employees used their American Express  x\Government account cards for charges to local restaurants and merchants, as well as  x{inappropriate retail purchases, gasoline charges, and charges for airlines. Although  xmonthly reports were reviewed by the Agency Program Coordinator, and forwarded to senior management officials, there was no process to followup on misuse.  xMThe Managing Director and General Counsel concurred with the recommendation for corrective action and has instituted appropriate corrective action.  \-3.xReport on Cellular Telephone Utilization (OIG 962) xThe report was issued on August 15, 1996  xjThe OIG identified that inadequate internal controls existed within the FCC to discourage  xemployees from abusing their FCC provided cellular phones. The cost of cellular phones  x[versus wired ISDN phones is significant. Local cellular phone usage is billed at a rate of  x35 per peak minute and 15 per minute off peak and carries an additional 10 per call land line fee, versus the ISDN flat rate of 9 per call.  x^In FY 1993, the FCC maintained a cellular phone inventory of 6 telephones. By  xSeptember 1993, this number had grown to over 130 telephones. Consistent with this  x[growth, the average monthly cellular phone bill of the FCC went from $1,731 per month in FY 1994 to $7,580 per month in FY 1995.  x=A sample of judgementally selected phone bills for FCC employees whose cellular phone  xbills consistently exceeded $100 per month over a six month period from January through  x>July 1995, was reviewed by the auditors. Using a PhoneDisc CDROM package, the  xauditors found a pattern of phone calls being placed to personal residences, restaurants,  xzautomobile dealerships, etc. Subsequently, the employees who had placed these calls  x]were interviewed and requested to review their individual telephone bills and notate""$0*%%""  xwhether the calls were personal or business related. The results of our analysis and  xsubsequent feedback from the employees questioned, clearly pointed to a pattern of  xcellular phone abuse within the agency with resulting adverse financial impact upon the government.  x The audit report contained three recommendations for corrective action to which the Managing Director indicated concurrence.  \-4.xReport on Audit of Proposal for Initial Pricing Under RFP No. 9637 (OIG 9611) xThe report was issued on September 30, 1996  x=As requested by the Office of the Managing Director, Acquisitions Branch, an audit was  xconducted of a Time and Material, Indefinite Delivery and Quantity (T&M, IDIQ) pricing  x[proposal submitted to the FCC by a vendor. The objective of the audit was to determine  xand report on whether the proposed direct labor rates are acceptable as a basis to negotiate a fair and reasonable contract price.  xThe auditors questioned direct labor rates proposed for each labor category proposed in  xzthe base year and four option years. Of the total direct labor costs (based upon direct  xklabor rates multiplied by estimated direct labor hours) proposed of approximately $7.7 million dollars, the auditors questioned a total of $1,780,646.  x!The Contracting Officer will use the audit report as a basis of negotiation with the  x.proposed vendor. At the conclusion of the negotiation, the OIG will be provided a copy of the price negotiation memorandum. "d0*%%`"  y,K INVESTIGATIONS   `yxG ddd y  Zp-  hjK OVERVIEW   xInvestigative matters pursued by this office are generally initiated as a result of allegations  xreceived from parties external to this office or matters referred by the Director of Audits.  xReferrals are based upon findings of potential fraud, waste, abuse, corruption, or misman x/agement by FCC employees, contractors, and/or subcontractors. Upon receipt of an  xallegation of an administrative or criminal violation, the OIG usually conducts a prelimi x/nary inquiry to determine if an investigation is warranted. Investigations may involve  xpossible violations of regulations regarding employee responsibilities and conduct, Federal  xcriminal law, or other regulations and statutes pertaining to the activities of the  xCommission. Investigative findings may lead to criminal or civil prosecution, or administrative action.  xThe OIG also receives complaints from the general public, both private citizens and com xmercial enterprises, about the manner in which the FCC executes its program and  xoversight responsibilities. These complaints are examined to determine whether there is  xany allegation of employee wrongdoing or that the process was not followed or is inef xfective. If none of the enumerated factors are present, then the complaint is referred to  x!the appropriate bureau for response directly to the complainant with a copy of the response provided to the Inspector General.  \-INVESTIGATIVE ACTIVITYă  \ -Cases pending as of March 31, 1996 .......................................  xx4  \-Plus: New cases .........................................................................   +21  \-Minus: Cases closed ....................................................................   16  \-Cases pending as of September 30, 1996 ......................................  xx9 X# 0*%%"3G '#V G <=XԌ  Z-@ INVESTIGATIVE CASE SUMMARIESă  xzDuring this reporting period, OIG investigative activity continued to focus on a matter  xzfirst referred to the Department of Justice on March 5, 1996. The Inspector General,  xDirector of Investigations, and OIG audit staff have continued to work with agents of the  xFederal Bureau of Investigation (FBI), the U.S. Attorney's Office for the District of  xLColumbia, and a grand jury. Federal Rule of Criminal Procedure 6 precludes any further discussion pertaining to this investigation.  xAnother case remaining open from the last report relates to an investigation referred to  x=the Public Integrity Section, Criminal Division, Department of Justice for prosecution of  xja potential violation of 18 U.S.C.  207(a)(2), post employment restrictions. This matter has not been brought to closure as of the conclusion of this reporting period.  \-Opened this reporting period and remaining open.  xTwo of the cases opened this reporting period have been referred to the FBI. One is open  xpending the development of further evidence by this office. No more details can be  xpresented since the target is unaware of our interest. In the other case, which involves  xpossibly illegal attempts to manipulate Commission decisions, the FBI is actively investigating while this office stands ready to assist.  xEmployees are involved in three of the open cases. In one an employee is under suspicion  x=of misusing government property. In the other two, the employees have alleged that the  xFCC through its supervisors has not followed established procedures. One case involves selection to a higher grade and the other involves a performance appraisal.  \X- xAnother pending case involves a complaint by a citizen that an improper ex parte contact  xhad been made in a restricted case and that this improperly affected the decision maker.  xThe second outside complaint involves an allegation that a field office has been unresponsive.  \< -Opened and closed this reporting period.  xThe largest number of cases closed this reporting period (12) involve complaints from the  x<public regarding the performance or nonperformance of official functions by headquarters  xand field office staff. The substantive issues ranged from failing to enforce Emergency"$$ 0*%%""  xBroadcast System rules to the improper cancellation of licenses and failure to enforce the obscenity standards.  \- xTwo complaints from the public involved the area of ex parte submissions contrary to  \- xFCC rules. There were admittedly ex parte communications made, however, neither was  xfound to have been done intentionally to obtain a specific outcome. Further, neither affected the integrity of the process or outcome.  xThe last two cases closed involved potential employee misconduct. The first appeared to  x{be the improper use of official mail for unofficial business. However, investigation  xdetermined the mailings were in support of official business. The second case involved  x\an attempt to break into a computer system. This investigation was closed due to the  xinability to develop any investigative leads after learning that a power failure  xcompromised the facility's security system and may have even caused the software program to indicate an attempted login on the computer in question.  Z- HOTLINE CALLSă  x\During this reporting period there were 73 calls to the published hotline number (202) 4180473. These calls can be divided into 7 broad categories:  \z-x1. Calls seeking information@hpp  20xx 0(#(#X \t-x2. Calls complaining about interferencepp   3xx 0  \n-x3. Calls complaining about local cable provider   3xx  \h-x4. Calls complaining about fraud/scamspp   4  \b-x5. Calls complaining about phone service/slamming/bills  16  \\-x6. Calls in reference to complaint against FCC employee   1  \V-x7. Calls miscellaneous@hpp  26xx 0(#(#Xx "P 0*%% "  y,K MANAGEMENT AND ADMINISTRATION   \`-   \Z- x During the sixmonth reporting period covered by this report, the Inspector General has  x[continued in his efforts to focus the work of this office towards addressing the needs of  xthe Agency. That is, to ensure the integrity and efficiency of FCC operations during a  xperiod in which our mission is rapidly expanding and our fiscal and staffing resources are significantly constrained.  xThe FCC is an organization that is continuously striving to better meet the needs of our  xLcustomers while addressing the laws established by the Congress. The Commission has  xaggressively acted to increase its' accessibility to the public via the internet and the new  xltoll free call center located in Gettysburg, Pennsylvania. The Commission has also  xrecently established customer service standards which communicate to our users what  xservices they can expect from the Commission, and provides a methodology to evaluate  x!whether we are meeting these self imposed standards. Likewise, the Commission  xcontinues to be active in the area of identifying spectrum which can, at the direction of  x=Congress, be auctioned off to the private sector, thus generating revenue for the Federal  xgovernment. The agency has also geared up in its' efforts to implement the provisions of the 1996 Telecommunications Act.  xAs previously identified, the Commission is in the process of implementing additional  xautomated systems to speed customer service through electronic filings, callcenter  x[operations, internet access to core FCC data bases and numerous other facets of agency  xjoperations. In formatting our FY 1997 Audit Plan, the OIG has tracked this trend within  xthe agency and is moving to commit audit resources towards ensuring the integrity,  xeffectiveness and efficiency of these new programs and functions. One example is in the  xarea of automation security. The OIG has worked aggressively with agency personnel to  x<provide the highest level of assurance that FCC automated systems are protected from data  xloss and unauthorized access. In the coming months we will continue to focus upon this  xobjective and serve as both an upfront partner, and proactive reference tool in the design,  xprocurement and implementation of new systems within the automated architecture of the Commission.  xLWe have also bolstered our inhouse expertise in the area of contract auditing. This was  xpartially accomplished by having a contract auditor detailed from the Wireless  xTelecommunications Bureau (WTB) to the OIG for 120 days. The Inspector General will  xseek to make this temporary personnel action permanent. This office recognizes that a"$ 0*%%F#"  xsignificant outlay of FCC funds are directed to vendors in consideration for their  xperformance of services and delivery of goods to the agency. Accordingly, the OIG is  xnow working in an extremely constructive manner with the Office of the Managing  x Director to provide the Acquisitions Branch full contract audit services to include the  xperformance of preaward, postaward and contract closeout audits. Through the  xjperformance of such work, the OIG can make a positive impact upon agency operations  xand assist management in getting the best deliverables possible at the most economical cost to the taxpayer.  xOIG staff will also reinstate the Field Inspection Program (FIP) in the coming months.  xThis program, initiated in 1995, represented the first time an independent entity within the  xFCC traveled to field offices to perform a comprehensive inspection. The inspection team  x=completes a detailed checklist, developed to assess compliance with Federal government  xand internal FCC rules and regulations. Additionally, the OIG staff conducts interviews  xwith FCC staff and persons/organizations serviced by the field office (to include law  x<enforcement and government agencies) to obtain feedback on operational effectiveness and  xefficiency and identify impediments which may exist to the realization of optimal  xperformance. The FIP also searches for best practices which may be transportable to other field locations.  xThe Inspector General will be the subject of a peer review in the coming reporting period.  xThis review has been requested in order that we might ensure that this office is operating in full compliance with applicable regulations and laws. "| 0*%%"  y,K x- SPECIFIC REPORTING REQUIREMENTS OF  y`,KSECTION 5(a) OF THE INSPECTOR GENERAL ACT  \- Zx^  \-   !xThe following summarizes the Office of Inspector General response to the twelve  xspecific reporting requirements set forth in Section 5(a) of the Inspector General Act of 1978, as amended.  Z - x1. A description of significant problems, abuses, and deficiencies relating to the  x{administration of programs and operations of such establishment disclosed by such  Z -activities during the reporting period.   xNo such problems, abuses, or deficiencies were disclosed during the reporting period. x  Zx- x2. A description of the recommendations for corrective action made by the Office during  xthe reporting period with respect to significant problems, abuses, or deficiencies identified  Zl-pursuant to paragraph (1). xNo recommendations were made. See the response to paragraph (1).  ZT- x3. An identification of each significant recommendation described in previous semiannual reports on which corrective action has not been completed.  \H-  \B- xNo significant recommendations remain outstanding.  Z<-  x\4. A summary of matters referred to prosecutive authorities and the prosecutions and  Z0-convictions which have resulted.  x?On August 29, 1996, a matter pertaining to potential criminal activity related to the  xlicensing of four radio stations in Vero Beach, Florida, was referred to the FBI. The investigation remains in an open status at this date.  x\A second matter was referred to the U.S. Department of Justice in the prior reporting  xperiod. The investigation remains in an open status. Specific issues related to this matter will be addressed in this forum in subsequent reporting periods as warranted."$0*%%""Ԍ xԙAn investigation which was opened during a previous reporting period and referred to the  xU.S. Department of Justice pursuant to section 4(d) of the Inspector General Act remains  xMin an open status. The investigation involves a potential violation of postemployment restriction of 18 U.S.C.  207 (a) (2).  \-  5.xA summary of each report made to the head of the establishment under section  Z-(6)(b)(2) during the reporting period.   xNo report was made to the Chairman of the FCC under section (6)(b)(2) during the reporting period.  Z - x6. A listing, subdivided according to subject matter, of each audit report issued by the  xOffice during the reporting period, and for each audit report, where applicable, the total  xdollar value of questioned costs (including a separate category for the dollar value of  xunsupported costs) and the dollar value of recommendations that funds be put to better use.  \-   xEach audit report issued during the reporting period is listed according to subject matter and described in part III, above.  Z-7. A summary of each particularly significant report.   xEach audit report issued during the reporting period is summarized in part III, above.  Zl-  x=8. Statistical tables showing the total number of audit reports with questioned costs and  Z`-the total dollar value of questioned costs.  \Z-  \T- x The required statistical table can be found at Attachment A to this report.  ZH- x9. Statistical tables showing the total number of audit reports with recommendations that  ZB-funds be put to better use and the dollar value of such recommendations.  \6!- x The required statistical table can be found at Attachment B to this report.  Z*#- x10. A summary of each audit report issued before the commencement of the reporting  xperiod for which no management decision has been made by the end of the reporting"$$0*%%""  xperiod (including the date and title of each such report), an explanation of the reasons  xsuch management decision has not been made, and a statement concerning the desired  Z-timetable for achieving a management decision on each such report. xNo management decisions fall within this category.  Z-  x11. A description and explanation of the reasons for any significant revised management  Z-decision made during the reporting period.  \- x No management decisions fall within this category.  Z - x-12. Information concerning any significant management decision with which the Inspector  Z -General is in disagreement. xNo management decisions fall within this category.