Department of Agriculture
A Management Control Audit of the Texas Department of Agriculture
Report Number 97-032
January 1997
Overall Conclusion
The Texas Department of Agriculture (Department) has implemented management controls sufficient to provide reasonable assurance that its goals will be achieved, its assets are safeguarded, its management decisions are based on reliable data, and it is complying with applicable federal and state statutes.
Key Facts and Findings
Within the Department's existing system of sound management controls, as well as within the controls in place at the Texas Agriculture Finance Authority (TAFA), we identified several areas for improvement. Specifically:
In the past, the TAFA Board has made some lending decisions without relying on its approved loan guidelines. Under the most active of the programs, the Loan Guaranty Program, the TAFA Board has approved loan guarantees of $39,966,459 to 48 enterprises since June 1991. Ten of these loans are currently in default, and losses are expected to amount to $2.7 million. In addition, three of the five TAFA programs reviewed do not appear to be active enough to meet program objectives. One program has yet to be activated while the other two programs require changes to procedures to enhance program participation.
Information on the Department's market enhancement and regulatory enforcement divisions is not consistently included in its information systems, and the effectiveness of the marketing efforts has not been reviewed.
Although the Department's Internal Audit Division (Internal Audit) provides management with analyses, appraisals, recommendations, and counsel regarding the Department's activities, Internal Audit is not complying with the standards set by the profession to ensure that management receives effective independent appraisal services.
Controls over classified positions provide assurance that qualified individuals are hired and trained to do their jobs effectively. However, exempt employees are not subject to the same controls over hiring and evaluations as are classified employees. (Exempt employees account for 29 of the Department's 492 full time equivalent staff positions.)
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