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House Fails Part of 2009 Financial Audit

Lofgren, the only Member to attend Thursday’s hearing who was also on the committee last year, called “troublesome” the “lack of cooperation and misleading information coming from the former CAO and other senior CAO staff towards the auditor, the IG’s office and even this committee.”

Less than two weeks after Beard resigned, Strodel was appointed his successor.

The new CAO has installed a new management team, replacing as many as 10 top employees since Beard’s departure, Strodel said. “My reputation is on the line at this point,” he added.

“The primary driver to the situation that evolved was the tone at the top of the organization,” Strodel said in his testimony. “This is the long-term focus I have to make, to begin to put in place the structures that are going to help the organization evolve and transform it into a high-performing organization again.”

Grafenstine said there has been a reversal in tone since Strodel took the helm.

“It was night and day,” she said, “the complete sweeping changes that occurred since last summer.”

But because Strodel took over toward the end of fiscal 2010, his office was not able to implement the necessary controls in time for that year’s audit. As a result, the House will likely fail the internal control part of the audit for the second time in as many years.

But Strodel and Grafenstine said the CAO is on track to right the organization by this year’s audit.

Rep. Aaron Schock (R-Ill.), who joined the House Administration Committee this Congress, questioned at the hearing why it took months to dispose of Beard.

Grafenstine assured him that the committee took decisive action when it became necessary.

“It seemed that they were providing constructive feedback and trying to get him on board. It just didn’t seem to have a lasting effect,” she said. “As soon as it became clear that we had reached the point of no return, it was swift.”

Oversight Subcommittee Chairman Phil Gingrey was satisfied with that assessment.

“I would like to commend the former majority for having the ... insight to make a quick change,” the Georgia Republican said.

Clarification: May 26, 2011

Although the Chief Administrative Office failed the internal controls portion of its audit, the finances themselves received a clean opinion by the auditor.

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