Senator BYRD. You could report it to Congress, and how long do you think it would take to get action? Of course, if they were in session they could have a meeting. Would you report it to a committee of Congress? Mr. ELLIOTT. I think a special committee is set up in the bill. Mr. DENIT. Without meaning to be unfair to the committees of Congress, I think the answer to that question would be that we probably never would get action on some of those things. The CHAIRMAN. How prompt have you been in certifying things to the Congress? Mr. DENIT. I do not know just what things you have in mind. The CHAIRMAN. What reports have you made to the Congress? Mr. DENIT. We have made reports every year. Senator O'Mahoney raised that question this morning with Judge Elliott. I, for one, in the General Accounting Office, feel very much like a son whose father, when he reached the age of majority, fixed upon him certain responsibilities, gave him certain things to do, told him to go ahead and do them and report to him from time to time as to how he was doing them, and then when that was done the father paid no attention whatever to the reports, and the son finally came to the conclusion that it was not worth while reporting. There are contained in the reports of the Comptroller General a great many recommendations for really noteworthy improvements in the fiscal administration of the Government. You will find back as far as 1926 a very strong and worthy recommendation for a change of the disbursing procedure of the Government. The Comptroller General has no power to direct a thing like that, but we did recommend to the Congress that there should be a change, to take the disbursing officers from under administrative supervision. It was not until the present administration that any action was taken, and that was accomplished through Executive Order No. 6166, that is to say, the disbursing activities of the Government were centralized. You will find in every printed report of the Comptroller General certain worth-while recommendations and reports to the Congress on what the office has done with respect to prescribing accounting systems, the number of vouchers and transactions which we have handled, or comments on the difficulties which we have had in undertaking to do our work. I remember one instance specifically which occurred here in the municipal government of the District. We reported to the Congress not only that the office had failed to install prescribed systems but that the court, one of the courts in the District, was short, and that we had not been able to bring about a proper adjustment. Senator O'MAHONEY. Let us bring this thing to a head. How long would it take to have prepared an index of the various recommendations which have been made to Congress by the General Accounting Office since the passage of the present law, in its various reports, giving citation to each one? Mr. DENIT. I think we could do that in 2 days. Senator O'MAHONEY. Would you be good enough to do that? Senator O'MAHONEY. And send it to the committee? Mr. DENIT. Yes, sir. (The statement requested appears at the end of the day's testimony.) The CHAIRMAN. May I return one moment to something? Before you got on to the reports, you stated that if you find an irregular transaction, that there would be no remedy under this bill. You would report it to the Director of the Budget, would you not? If you find a voucher irregular now, you would probably notify the official to suspend further expenditures of that kind. That is what you do under existing practice, is it not? Mr. DENIT. Under existing practice I said we would disallow it. The CHAIRMAN. First? Mr. DENIT. That is right. The CHAIRMAN. What else would you do? Mr. DENIT. There would be no further action for us to take. The CHAIRMAN. But he could go on and make the same expenditure the following day? Mr. DENIT. And it would be disallowed. The CHAIRMAN. It would be disallowed? Mr. DENIT. Yes, sir. The CHAIRMAN. You would notify the officer, however, of the suspension? Mr. DENIT. Yes, sir. The CHAIRMAN. Under this bill you would notify the Director of the Budget. Mr. DENIT. Yes, sir. The CHAIRMAN. Assuming that you would notify the official that it was suspended, you would have the same situation. The official would know that the transaction had been disapproved, would he not? Mr. DENIT. That is right. The CHAIRMAN. Then if the Director of the Budget did not notify him, he would be in this position: That the Auditor General would be required to notify the Joint Committee of Congress? Mr. DENIT. That is right. The CHAIRMAN. And if the Director of the Budget did not agree with you, he would have to justify his action before the committee? Mr. DENIT. Yes, sir. The CHAIRMAN. Now, you would just disallow it? Mr. DENIT. Yes, sir. The CHAIRMAN. And that is all? Mr. DENIT. Yes, sir. The CHAIRMAN. Would you report that to a committee of Congress? Mr. ELLIOTT. I would suggest that is a case of that kind it would be reported to the Attorney General for suit, and a suit on the official's bond or whoever is responsible could be filed. The CHAIRMAN. That should be done. Mr. ELLIOTT. That is the final remedy. The CHAIRMAN. We agree with you that in either case that would be true. When you disallow that, you would not have any tribunal, such as this bill contemplates in the joint committee, to whom this transaction would be reported at such time? Mr. DENIT. We do not have that now; no, sir. The CHAIRMAN. When last did you print a report and send it to the Congress? Mr. DENIT. 1932. 9757-37-22 The CHAIRMAN. Five years ago? Mr. DENIT. Yes, sir. Mr. ELLIOTT. The reason that it was not printed after that was because of the economy wave which hit us. Mr. DENIT. We have no funds. The CHAIRMAN. What were your appropriations in 1932? Mr. ELLIOTT. Mr. McFarland, can you give that, that is, that which directed them not to print the report? Mr. MCFARLAND. Just a direction to not print matters which they found not necessary. The CHAIRMAN. If you found it not necessary? Mr. MCFARLAND. Yes, sir. The CHAIRMAN. And you determined it was not necessary? The CHAIRMAN. You made the report but you did not print it. What was your printing fund in 1932, and what was it this year? Mr. ELLIOTT. I could not tell you offhand on that. The CHAIRMAN. I can find out. Mr. ELLIOTT. That has nothing to do with this question. The CHAIRMAN. The witness stated that there was a lack of funds. You say it was because, as Mr. McFarland says, the discretion was left with you as to whether it would be printed, and you exercised that discretion, and it was not the failure on the part of Congress to provide funds. Mr. ELLIOTT. The report was made, but it was not printed. The CHAIRMAN. I did not want you to say that it was because of lack of funds, if it was not. Mr. ELLIOTT. I do not want to lay anything on the Congress, but either the Congress or an Executive order was what gave the authority for not printing, to save money. The CHAIRMAN. It gave discretion to you and saved money? The CHAIRMAN. Your printing appropriation for the last 2 or 3 years would be large enough to print it, if it was thought wise or necessary to print it? Senator O'MAHONEY. What did you do with the report iself? Mr. ELLIOTT. The report is on file, where it is provided. I furnished the Congress with copies of the last report. Senator O'MAHONEY. You furnished me with a copy of the report at one time, did you not? Mr. ELLIOTT. Yes, sir. Senator BYRD. Was it mimeographed? Mr. ELLIOTT. No; it was just typewritten, as I remember it. I have nothing to do with that feature of it. Senator BYRD. Let me get clear about the appropriation bill of 1932. You said that had a provision in it that you should not print it unless you thought it sound? What was the exact language? Mr. ELLIOTT. I cannot recall the exact language, but there was something to that effect. Senator O'MAHONEY. We have effectively abandoned that policy with every department except the General Accounting. Senator BYRD. Up to that time the General Accounting Office had made many reports which had been printed? Mr. ELLIOTT. I want to tell you this: If I last long enough to get to it, I am going to print the report and send it up to you. The CHAIRMAN. I hope you will last long enough, for two reasons: First, because I like you, and second, because I would like to see the report. Mr. ELLIOTT. I had enough trouble with the other report last spring, so that this time I am going to have it printed, no matter what it costs, and I will send it up to you, and you can exercise your judgment as to whether you will read it or not. Senator O'MAHONEY. Of course you might exercise a little judgment as to what you put in it. The CHAIRMAN. Who is the next witness? Mr. ELLIOTT. Mr. Cooper. STATEMENT OF C. H. COOPER, CHIEF OF THE POST OFFICE DIVISION OF THE GENERAL ACCOUNTING OFFICE The CHAIRMAN. Mr. Cooper, I will ask you the same question that I have asked of other witnesses, namely, if you have any comments to make upon this bill, and, if so, we would be glad to hear you. Mr. COOPER. It seems to me that if this bill is passed, it will add greatly to the cost of auditing and accounts. There are about 44,000 to 45,000 postmasters, and we get postal and money-order accounts, postal-savings accounts, United States Savings bond accounts, and that means that they would audit those in the field. As apparently intended, I do not see how it could be done, and it would certainly add to the cost. As it is now, those accounts come to Washington, to our office, and receive a prompt audit. Senator O'MAHONEY. How prompt? Mr. COOPER. The postal and money-order accounts are audited within 3 months after their receipt. They are quarterly accounts. Senator O'MAHONEY. There is always a difference, is there not, between the figures in these accounts and the figures of the comptroller of the Post Office Department? Mr. COOPER. That is correct. There is bound to be. Senator O'MAHONEY. That difference has existed over a long period of time, has it not? Mr. COOPER. For example, each administrative officer makes up or gets estimates, makes up estimates and gets figures monthly from the the postmasters as to what they have expended, and then at the end of the quarter when postmasters make up the accounts, they put those figures together. Those figures may not agree with what they have reported to the comptroller. Senator O'MAHONEY. How often do you get the figures? Mr. COOPER. Every 3 months. They are quarterly accounts. The CHAIRMAN. This statement of yours is based upon the language which is to be found in S. 2700 in section 303, and which reads as follows: The General Auditing Office shall promptly make an audit of all public accounts after payment but prior to settlement by the Director of the Bureau of the Budget. Each such audit shall be conducted as nearly as practicable in the vicinity of disbursing offices of the United States in the District of Columbia and elsewhere. I think a reasonable interpretation would be that. Mr. COOPER. Would the Auditor General audit the accounts in Washington then? Would you superimpose another audit on what we have now? Our audit would be transferred to the Director of the Budget. Is that correct? All we are now doing goes to the Director of the Budget? Senator O'MAHONEY. That is what we are trying to find out from you, what the authority would be. The CHAIRMAN. I was inferring from your language as to the cost in the field that you based it upon this statement. Mr. COOPER. That is correct. The CHAIRMAN. Seeing that you did not agree it was practical to conduct it in every section of the country, then there would be no difference, in so far as this particular legislation is concerned? Mr. COOPER. No; we could do it here. The CHAIRMAN. And you think it would be sufficient to do it here? Is that your view? Mr. COOPER. I think we would save money leaving it as it is. The CHAIRMAN. That is, to have it done here? Mr. COOPER. Yes, sir. The CHAIRMAN. I can well see if it was conducted all over the country Mr. COOPER. It would be very expensive. The CHAIRMAN. You do not think it is the best way to do it? The CHAIRMAN. That is the answer. I have no other questions of you along that line. Do you have any other comments to make? Mr. COOPER. The question of preaudit and postaudit and the question of the control over the department's spending: The Postmaster General audited his own accounts practically up to 1824 or 1825, and Congress passed a statute March 3, 1825, directing him to receive the accounts of postmasters and audit them and deposit the surplus in the Treasury. In 1836 or 1835 there was evidently some difficulty in that audit, in permitting a department to audit its own accounts so that they passed the act of July 2, 1836, setting up the auditor of the Treasury for the Post Office Department. Now, the peculiar feature of that office was this: That the auditor was to receive the accounts of the postal service, preserve the accounts, after settlement, close the accounts of the department quarterly, and submit statements of those accounts to the Postmaster General and the Secretary of the Treasury. The Postmasters were directed or authorized to pay the expenses of their offices from their receipts. The auditor was directed to examine those expenses, the vouchers for those expenses, and if found in conformity with law they could be allowed. That is all the law said. Senator O'MAHONEY. And the law then means exactly what it means now? Mr. COOFER. Yes, sir. Senator O'MAHONEY. That is to say, it had only to do with Government bookkeeping and not to do with the actual payment? Mr. COOPER. The postmaster was authorized to pay his own salary and the expenses of his clerks. Senator O'MAHONEY. Yes, sir; and if he paid himself it was a matter for determination after the event? |